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Taking Back Time Through Transparency in LTC Pharmacy Management

Part Two: Achieve Transparency in LTC Pharmacy Management—Time is Money

In Part One of our series in Achieving Transparency in LTC Pharmacy Management, we explored the three key areas most improved by greater transparency: time, money, and compliance. In this article, we examine how transparency can save operators and facilities a significant amount of time by integrating automation and technology into their pharmacy relationships. 

As discussed in Part One, the complexity of claims data on pharmacy bills makes analyzing and reviewing bills a full-time job. Even then, without the right expertise and resources in place, most operators will find it impossible to fully understand their bills without expending a significant amount of time. 

Tuvia Aizenberg, VP of Operations at Premier Healthcare Management, oversees operations for more than 20 long-term care facilities. He recently spoke about the challenges operators face in properly managing their spend, and its strain on facilities. “Unless an operator has someone who is a pharmacy expert, who spends day and night working on their pharmacy spend, on cost containment, and ensuring that every single admission that’s brought in is coming with the exact drug that needs to be covered on the plan, they are probably missing out. It’s a full-time job, and many operators don’t even understand the need for this. They may know there’s a problem, but they don’t necessarily know where to even begin identifying it.”

The following is an overview of areas that operators should be analyzing and addressing regularly:

  • Returns / credits
  • Pricing discrepancies
  • Duplicate orders
  • Split bill opportunities
  • Payer-source discrepancies
  • Prescriptions filled after discharge
  • Over-the-counter (OTC) opportunities
  • Prescriptions refilled too soon
  • Opportunities to improve drug utilization (formulary optimization)
  • Eligible rebates
Automation Saves Time

Sifting through each bill, but also through the details of each and every claim, is the only way to ensure the lowest net cost on pharmacy spend. This is where automation becomes a critical component of proper pharmacy management practices. Without automation, even with dedicated resources assigned to analyzing these areas, it is impossible through manual and human efforts to accurately identify all areas for cost savings and rebate opportunities. 

Accurate Reporting 

Identification of these opportunities is, after all, only the first step. In the case of returns and credits, these requests must be itemized in a report that is submitted to the pharmacy. Without accurate analysis and reporting, many of those eligible returns, credits, and rebates go unrealized, leaving significant dollars unaccounted. By using a technology that integrates all of your contract information, including pricing, day supply and quantity restrictions, preferred and excluded drugs, along with data from national pricing databases, operators are able to leverage technology and automation to decrease manual labor and increase accuracy and efficiency. 


The most effective tool operators can request from their pharmacy partners is the ability to adjudicate. Adjudication integrates the capabilities described above into the pharmacy claims submission and reporting process. Pharmacies willing to put this in place are able to build transparency into their relationships and act as trusted partners with their operator customers. Once in place, adjudication automates alerts to facilities when claims fall outside these established parameters, and prevent errors from occuring in the first place. This means operators no longer have to spend time chasing down unnecessary errors, or submitting returns and credits for discrepancies—it’s all built into the process. 

Identify Eligible Rebates

Rebates are another area where automation can save both time and money. There are a few components that go into maximizing the eligible rebates for an LTC facility. The first and most important is ensuring that your pharmacy partner recognizes that you, as the payer on prescription medications at your facility, are the party eligible to receive these rebates. Some pharmacies and pharmacy contracts either intentionally or unintentionally submit rebates on behalf of their customers. This may be written into pharmacy contracts and explained as an opportunity for the pharmacy to lower drug costs. In practice, lower pricing rarely equates to the actual value of the rebate, and pharmacies should be transparent about any associated fees or rebates they are receiving on behalf of an operator. Regardless, LTC operators need to understand that these rebate dollars are rightfully theirs. 

Another important component of maximizing rebates is looking at rebates through the lens of your drug utilization analysis. Many bioequivalents are eligible for valuable rebates. By selectively identifying these opportunities, in combination with ensuring the right medication solutions for your patient population, facilities can decrease costs and guarantee quality patient outcomes. 

Last but not least, operators need to have a way to analyze each and every claim for rebate opportunities. One example of why automation and transparency are so important is highlighted in IV and compound drug claims. Without technology identifying opportunities within these claims, most facilities miss the rebate-eligible components as they don’t appear on face value in the original claim. Only with technology that can immediately identify the details within each claim are maximum rebates achievable. 

Allowing technology to introduce greater transparency into your pharmacy relationship is the only way to reduce the amount of time and effort required to achieve lowest net cost. Short of this, facilities must rely on limited human capital to identify errors, appropriately analyze claims, and successfully report and request credits and rebates. In all, pharmacy spend is too costly, complex, and time intensive without technology and automation. 

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Related Articles

Part 1: Achieving Transparency in Long-Term Care Pharmacy Management

Part 3: Saving Costs Through Increased Transparency in Your Pharmacy Relationship

Part 4: How to Increase Transparency in Your Pharmacy Relationship to Ensure Compliance

Top 3 Things to Look for in a Pharmacy Partner

How to Maximize the Rebate Dollars You Put Back Into Your Long-Term Care (LTC) Facility

3 Opportunities for Managing Costs at Long-Term Care Facilities

How Automating your Drug Utilization Review can Transform your Pharmacy Relationship

SRX is a technology and advisory company that helps LTC operators realize the lowest net cost on pharmacy spend. We help our customers improve drug utilization, manage pharmacy relationships, reduce costs and waste, and maximize rebates. SRX technology also analyzes pharmacy contracts, identifies areas of concern, and makes recommendations regarding cost savings opportunities through automation, adjudication, and drug utilization. We are committed to transparency and accountability and guarantee quarterly rebates that are paid on time, every time. Contact us at 833 633 6833.

Learn more about our cost-saving solutions.

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