{"id":40544,"date":"2022-08-12T16:18:15","date_gmt":"2022-08-12T16:18:15","guid":{"rendered":"https:\/\/www.srx-tech.com\/articles\/?p=40544"},"modified":"2022-08-16T21:29:49","modified_gmt":"2022-08-16T21:29:49","slug":"5-things-to-know-before-switching-ltc-pharmacy","status":"publish","type":"post","link":"https:\/\/www.srx-tech.com\/articles\/5-things-to-know-before-switching-ltc-pharmacy\/","title":{"rendered":"5 Things You Need to Know Before Switching LTC Pharmacies"},"content":{"rendered":"\n<h2>For long-term care (LTC) operators, drug costs represent one of the largest cost centers outside of labor.<\/h2>\n\n\n\n<p>One of the most important factors in controlling these costs and taking charge of pharmacy spend is having the right contract with the right pharmacy. As operators are increasingly seeking opportunities to control costs, many are re-negotiating contracts or finding pharmacy partners that better align with their objectives.<\/p>\n\n\n\n<p>While regularly reviewing contracts, terms, and relationships are best practices for any LTC operator, it\u2019s equally important you understand critical components of pharmacy contracts that impact cost, transparency, and the <em>quality<\/em> of your relationship with your contract pharmacy in the long run.<\/p>\n\n\n\n<p>Before switching pharmacies or re-negotiating contract terms, keep the following in mind:<\/p>\n\n\n\n<h5>1. Drug Manufacturer Rebates Belong to LTC Operators<\/h5>\n\n\n\n<p>As the payer for medication costs, operators should receive rebates for eligible medications that commonly add up to tens of thousands, if not millions, of dollars annually, depending on the size of the operator.<\/p>\n\n\n\n<p>Operators need to check their pharmacy contracts for language that may be signing rebates over to their pharmacy who may or may not factor the savings into the pricing. Most operators prefer to keep rebates transparent, knowing their value by submitting through a third-party pharmacy benefits manager (PBM). LTC operators should be clear on the following terms:<\/p>\n\n\n\n<ul><li>Exactly who is submitting rebates<\/li><li>How are the savings getting back to the facilities<\/li><li>What are the value of the rebates in dollars<\/li><li>What guaranteed rate should a facility expect to receive<\/li><li>What is the time frame for receipt of rebate payments<\/li><\/ul>\n\n\n\n<p>This requires accurate and transparent billing, reporting, and submission processes. Without the right contracts in place, and transparent terms, many facilities end up missing out on thousands in critical rebate dollars.<\/p>\n\n\n\n<h5>2. Look for a Pharmacy Willing to Adjudicate<\/h5>\n\n\n\n<p>Adjudication is a process that integrates technology into the pharmacy relationship to automate the enforcement of contract terms, formulary parameters, and contract rules. This added level of transparency prevents errors from occurring in the first place by alerting pharmacies when terms or rules are being broken. In turn, this reduces the need to chase down credits and returns and provides operators with the insight needed to control pharmacy spending.&nbsp;<\/p>\n\n\n\n<p>Adjudication can also control for quantity restrictions, days supply, refills-too-soon, preferred\/excluded drugs, and more. If a pharmacy isn\u2019t using adjudication, operators should, at a minimum, expect digital files and reports to be delivered in a timely manner that can be exported and analyzed.<\/p>\n\n\n\n<h5>3. Pricing Should Be Based on Published Drug Pricing Sources<\/h5>\n\n\n\n<p>There are a variety of pricing models used in pharmacy relationships. Transparency and pricing are some of the key variables that impact whether terms favor pharmacies or facilities. The best pricing models are typically built on published drug databases (AWP, WAC, NADAC, FUL), plus a dispensing fee. This structure allows operators to verify pricing and know exactly how their costs are calculated. Other pricing structures, like \u201cPharmacy Costs\u201d allow pharmacies to charge without justification. \u201cFlat Fee\u201d structures fail to protect pharmacies from rising drug costs, which won\u2019t set the relationship up for success.<\/p>\n\n\n\n<h5>4. Not All Pharmacies (or Contracts) Are Created Equal<\/h5>\n\n\n\n<p>It\u2019s not just about comparing pricing. Without understanding the fine print and the implications of all contract terms and conditions, a lower quoted price may not translate to a lower actual price. Due diligence is critical and starts with evaluating multiple pharmacies. Be comfortable requesting sample reports, data exports, communications, and ask to see demonstrations of processes and procedures. This will help to set expectations and present opportunities to ask questions and potentially request customizations that will make for a smooth relationship.<\/p>\n\n\n\n<h5>5. Use an Expert to Review and Negotiate Terms<\/h5>\n\n\n\n<p>Most operators do not have the expertise on staff to fully understand, evaluate, or negotiate contract terms. Much like hiring a lawyer for critical legal contracts, hiring a pharmacy negotiation expert can provide the level of expertise needed to establish contract terms and pricing that ensure future success and secure the quality of the pharmacy relationship.&nbsp;<\/p>\n\n\n\n<p>SRX has a team of advisors that includes registered pharmacists and drug cost experts who employ proprietary technology to evaluate contracts and advise operators throughout the evaluation and negotiation process. With these tools in place, operators are better positioned to control costs and improve processes that impact their pharmacy spend.<\/p>\n\n\n\n<p>If you are currently thinking about renewing a contract or switching pharmacies, SRX has experts and technology to help you negotiate the best terms and feel confident in your pharmacy relationship.<\/p>\n\n\n\n<p><a href=\"https:\/\/srx-tech.com\/demo\">Speak To an Expert in Pharmacy Contracts<\/a><\/p>\n\n\n\n<hr class=\"wp-block-separator has-text-color has-black-color has-alpha-channel-opacity has-black-background-color has-background is-style-wide\"\/>\n\n\n\n<h5>Related Articles:<\/h5>\n\n\n\n<p><a href=\"https:\/\/www.srx-tech.com\/articles\/intro-to-transparency-achieving-transparency-in-long-term-care-pharmacy-management\/\">Part 1: Achieving Transparency in Long-Term Care Pharmacy Management<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.srx-tech.com\/articles\/taking-back-time-through-transparency-in-ltc-pharmacy-management\/\">Part 2: Taking Back Time Through Transparency in LTC Pharmacy Management<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.srx-tech.com\/articles\/how-to-increase-transparency-in-your-pharmacy-relationship-to-ensure-compliance\/\">Part 4: How to Increase Transparency in Your Pharmacy Relationship to Ensure Compliance<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.srx-tech.com\/articles\/top-3-things-to-look-for-in-a-pharmacy-partner\/\">Top 3 Things to Look for in a Pharmacy Partner<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.srx-tech.com\/articles\/maximize-rebate-dollars\/\">How to Maximize the Rebate Dollars You Put Back Into Your Long-Term Care (LTC) Facility<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.srx-tech.com\/articles\/cost-savings-opportunities\/\">3 Opportunities for Managing Costs at Long-Term Care Facilities<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.srx-tech.com\/articles\/checks-balances\/\">How Automating your Drug Utilization Review can Transform your Pharmacy Relationship<\/a><\/p>\n\n\n\n<p><\/p>\n\n\n\n<hr class=\"wp-block-separator has-text-color has-black-color has-alpha-channel-opacity has-black-background-color has-background is-style-wide\"\/>\n\n\n\n<p><a href=\"https:\/\/www.linkedin.com\/company\/srx-tech\">Follow us on LinkedIn<\/a><\/p>\n\n\n\n<p><em>SRX is a unified drug cost management solution for long-term care operators. We achieve unrivaled drug cost savings by combining our proprietary technology with expert advisors. SRX\u2019s solutions automate drug rebates, optimize pharmacy management practices, increase managed care exclusion reimbursements, and provide cost-effective employee prescription benefits. SRX guarantees quarterly rebates are paid on time, every time, with no out-of-pocket cost.<\/em><\/p>\n\n\n\n<p>Learn more about SRX\u2019s <a href=\"https:\/\/www.srx-tech.com\/articles\/long-term-care-solutions-2022\/#:~:text=cost%2Dsaving%20solutions\">cost-saving solutions<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>For long-term care (LTC) operators, drug costs represent one of the largest cost centers outside of labor. One of the most important factors in controlling these costs and taking charge of pharmacy spend is having\u2026<\/p>\n","protected":false},"author":2,"featured_media":40549,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[2],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v19.8 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>5 Things You Need to Know Before Switching LTC Pharmacies - Articles | SRX<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.srx-tech.com\/articles\/5-things-to-know-before-switching-ltc-pharmacy\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"5 Things You Need to Know Before Switching LTC Pharmacies - Articles | SRX\" \/>\n<meta property=\"og:description\" content=\"For long-term care (LTC) operators, drug costs represent one of the largest cost centers outside of labor. 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