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A B-school essay from a Pharmacist’s perspective

My Operations Management (OM) Professor in B-school had one question for our final exam.

Explain if this course will or will not be relevant in your chosen profession or career path?

I revisited my short summary a few days ago and considered the role of the Pharmacist in relation to the current healthcare model. How can Pharmacists help create efficiency when we see inefficiency? How can individual Pharmacists help bring order to a process and fill in the gaps when we see an opportunity to help?

I believe the Pharmacist can fill in the “gaps” and find an opportunity to serve in new ways.  This will further our value to the healthcare team. Dispensing medications correctly should always be the foundation of our Profession, yet there are more bricks to be put in place to create the final framework in our bid to be seen as “healthcare providers”. With the broad knowledge base that Pharmacists have in their toolbox, there is an opportunity to be more than “retail or clinical.”


December 4th 2015 at 9:53PM I submitted the following.


Sam Blakemore, PharmD

Personal Operations Management

I have been a practicing Pharmacist for three years.  In that time period, Walgreens purchased Alliance Boots, CVS Caremark purchased Target’s in store pharmacies, and most recently Walgreens made another large investment in agreeing to purchase Rite Aid Pharmacies.

The number of patients that the healthcare system takes care of will continue to rise due to more people having access to healthcare with the implementation of the Affordable Care Act.  Yet, the reimbursements for these services has become more competitive due to increased demand for better pricing by federal and state funded programs.

The Affordable Care Act has made mergers the new norm. Hospitals, Pharmacies, and Home Health Care Agencies have decided that the key to survival is to become as “lean” as possible. In becoming “lean”, the merged companies streamline operations by initiating new workflow processes, retire outdated facilities, and layoff under-performing workers in the hopes of increasing productivity and profits.

Mergers within the pharmaceutical industry are creating shifts in the supply chain. This will impact the drug companies, wholesalers, and retail pharmacies both independent and chain. In the article Drug Partnership Could Trigger Major Supply-Chain Changes, the author states the following:

For now, drug manufacturers mostly use wholesalers like AmerisourceBergen to ship their product to pharmacies. But if manufacturers are squeezed too much by the arrangement, some could opt to bypass wholesalers altogether and peddle their drugs straight to the drug stores…1

Pharmacy mergers have increased for the purpose of survival in a market with a reimbursement structure that changes by the day. In the article, Reassessing the pharmacy supply chain for a healthier bottom line, the author states the following:

The unpredictable and shrinking reimbursement landscape requires these organizations to reassess expenses and processes –especially within the supply chain—across all facilities and departments to determine cost-effective operational strategies.2

Forecasting reimbursement and cost of drugs in pharmacy is key to success. As an example, Rite Aid Pharmacies earnings per share decreased due to a cut in Medicare reimbursement rates.

Rising generic drug prices are hurting drug store operators as insurers and pharmacy benefit managers have been slow in raising reimbursement rates for those drugs…reimbursement rates for Medicare Part D drug plans, which cover prescription drugs for senior citizens and the disabled, are falling due to growing competition to win these contracts.3

Appropriately forecasting revenues and expenses, using lean/six sigma principles to eliminate drug errors, and having a firm grasp of inventory management are the big three principles I will remember from this course. Having a firm grip on these concepts can be the difference between thriving and failure in this market. It is imperative that a pharmacist have a firm grasp of operations management to thrive in this market and differentiate one’s self against other pharmacists they’re competing against for a job.

I want my patients to have a good experience. I want them to receive the right drug, at the right dose, at the right time, and for the right price. With that in mind, this quote grabbed my attention when I first read it.

“With the country focused on controlling the escalating costs of healthcare, every entity in the healthcare system is under increased pressure to lower costs—while at the same time not jeopardizing the quality of care that patients receive.”4

It is my opinion that schools of medicine, nursing, pharmacy, public health and so forth should require or offer as an elective an operations management course. This course has challenged me to reconsider how I manage employees and myself. This operations management course offered me the information, vocabulary, and resources that I’ll be able to draw from in a healthcare environment that is rapidly undergoing change due both to increased competition and decreased net margins.

References

1.) Martin, Timothy W. Drug Partnership Could Trigger Major Supply-Chain Changes. 22 March 2013. http://www.wsj.com/articles/SB10001424127887324373204578374801163395308. Accessed 23 Nov. 2015.

2.) Piotrowski, Cary. Reassessing the pharmacy supply chain for a healthier bottom line. 17 July 2015. http://www.beckershospitalreview.com/finance/reassessing-the-pharmacy-supply-chain-for-a-healthier-bottom-line.html, Accessed 18 Nov.

3.) Ramakrishnan, Sruthi. Rite Aid cuts full year forecasts citing reimbursements. 17 Sept. 2015. http://www.reuters.com/article/2015/09/17/us-rite-aid-results-idUSKCN0RH1I920150917#BMoHOwRPdPZFJMVo.97. Accessed 18 Nov. 2015.

4.) Pharmacy Inventory Project: Improving Inventory Management at Genesis Healthcare System Pharmacies. 19 Nov. 2014. http://fisher.osu.edu/supplements/10/14252/white_paper_genesis_2014_2.pdf. Assessed 18 Nov. 2015.


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Sam Blakemore is the Pharmacy Manager of Peds Rx Pharmacy Solutions. Connect with him via: LinkedIn

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Rebaked PIE…Pharmacist Industry Engineer


It’s not always about how much money a business makes; oftentimes its more important to understand how much money the business can save.

I asked a Pharmacist the following question:

“Who is probably the most famous and richest industrial engineer? Your hint… he grew up in Mobile, AL?”

He paused and thought about it for a few moments…

Then he said, “I’m not sure…who?”

I said, “look at your smartphone… Tim Cook  ring a bell…”

Tim Cook…iPhone…ring a bell…”HAHA.” I know…I know…so funny, not really. Our discussion began when he asked me about my experiences in B-school (business graduate school).  I discussed various points in my journey as a manager, and how I sought some  answers to my many managerial questions. B-school helped fill some of those gaps.

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Quantitative Analysis for Managers I explained was an interesting but difficult course. I really had to work hard to put all the concepts together. It was business math on steroids.  A taste of algebra with a pinch of calculus and a dollop of excel spreadsheet.  One week we were discussing linear programming models; the next week we were discussing transportation models.

I felt like I could study all week for the tests, and still not feel good about my prospects of passing. The Professor would allow us to have a formula cheat sheet, but that was of little  value.  The course took time and was intense. The tests were tough. He ended up curving our final grades that semester.

It was tedious work. It took time to wrap your mind around some of the concepts; but studying those concepts gave me satisfaction. My mind was being pushed and thats what I wanted as a student. It made me appreciate the skill and art it takes to make complex business processes less complex. I began trying to understand the formulas behind business principles. I enjoy learning about a Professor’s educational background. It always explains why some concepts just feel so natural to the teacher/lecturer. Turns out our Professor that semester was an expert in the field of industrial engineering. I had heard about civil engineering, chemical engineering, electrical engineering, etc.. But I had never heard of industrial engineering.

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Pharmacist in general have an appreciation for math and science.  So I decided to show my Pharmacist “buddy” an old video on linear programming that the Professor had uploaded on the web. The Pharmacist became “giddy” with anticipation on how to setup the correct mathematical equation to reach an appropriate business decision based on profitability.

We then lightly touched on transportation models

I said, “driving a 18-wheeler seems simple enough…but then imagine all the routes and paths those trucks can take to get to their destination.”

He said, “yea…that’s right…isn’t that why some mail couriers only take right hand turns? That’s why they have people doing that research…think of all the money they save on gas, and all the time they save by making routes more efficient…”

I said, “you know where most of these principles fall under? Industrial engineering…”

Industrial engineers bring science to our everyday lives by engineering efficiency; they use math to bring order to a process. Pharmacists practice the same methods with medications. We ensure patient safety by being the medication experts of the healthcare team. We bring order and create efficiency in the dispensing and consumption of medications.

So what’s stopping Pharmacists from reaching our full potential as the “industrial engineers” of drug management? Gaining status as “healthcare providers” will go a long way in creating a structure for the reimbursement of our services. But until that “provider status” reaches all 50 states; what can our Profession do to show the “system” our value?

Currently the market is focused on volume to magnify shrinking profit margins. However, the market will gradually shift to a focus on reducing costs. In part because rising costs will lead to skyrocketing debt in our current healthcare model. The market is at risk of collapse due in part to rising medication costs.  While we can’t control how Pharma prices new drug regimens.. Pharmacists can be on the front lines of change by initiating the following principles:

  1. Limit “defects”–use “lean” principles to ensure patient safety and accurate dispensing of medications with appropriate operations management principles
  2. Improve discharge planning—ensure patients receive the appropriate medications upon discharge.
  3.  Improve access—ensure that upon discharge from hospitals or clinics; patients have access in the community to the appropriate medications from local pharmacies, mail-orders, and patient assistance programs.
  4. Engage in dialogue with prescribers—regarding the prior authorization process, formulary additions and deletions, an analysis on patterns seen at the pharmacy in the local community.
  5. Build an alliance—with social workers, churches, community organizers so that when patients need help the Pharmacist can give guidance.
  6. Data mine–effectively gather data about medication usage and prescriber patters; then turn data into usable information to enhance quality of care.
  7. Reduce expense—have an active engagement in knowing the costs of medications, and the copay tiers of pharmacy benefit managers. Have an active discussion with patient’s and their families regarding their ability to manage these expenses.

There are more PharmD’s graduating with dual degrees; Pubic Health, Business, and Law. There are more PharmD’s entering pharmacy school having already obtained a bachelors degree. The “Millenial PharmD” has the potential to step outside the box to meet the changing demands of the market.

My version of the Pharmacist Industry Engineer (PIE) does not epitomize  the traditional meaning of Pharmaceutical Industrial Engineering   in that traditionally the framework of the definition was focused on manufacturing for “Big Pharma”.  I simply seek to use this term to reframe how we are defined as agents of change in the current marketplace.

A PIE as defined by me—both optimizes and individualizes pharmaceutical care, creates new processes to improve pharmacy access, improves operations to ensure patient safety, and builds communication channels with both prescribers and patients to reduce waste and expense for the individual and healthcare system.

Efficiency. Accuracy. Reduced Defects. Reduced Costs. 

 

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Sam Blakemore is the Pharmacy Manager of Peds Rx Pharmacy Solutions. Connect with him via: LinkedIn

Buckets in the Pharmacy? A look at pharmacy operations…

I’m a visual person.

In the pharmacy, visual cues help me make quick decisions regarding prescription status. As a student at a “chain pharmacy” I would put prescriptions in blue buckets or red buckets. Blue buckets for folks picking up their prescriptions in one to two hours, and red buckets for folks picking up in 30 minutes or less.

Throughout pharmacy school it was blue bucket versus red bucket. It’s a pretty efficient model. So efficient I took the practice up at the independent pharmacy that I manage. These buckets can easily be purchased online.

Then I went to business school and started studying operations management. I started to gain an appreciation for the blue bucket/red bucket workflow process. It was an effective method of ensuring customer satisfaction. It gave the Pharmacist visual cues as to what order prescriptions needed to be filled. Lastly, it helped maintain organization, thus decreasing “defects“. With the buckets you can simply drop the prescription in the bucket with the drug. Thus, things matched up when it was time to enter the order and fill the prescription.

I began reading articles on how other Pharmacist maintained organization. I read an article by a man that discussed how he used multiple colors of buckets. When I read the article, I felt like a pharmacy nerd when I read the article and became giddy. For me I had only known blue bucket and red bucket. How could I incorporate more buckets? I know I know…sounds lame!

I began writing up a method and came up with the following:


WORKFLOW

DROP OFF —> DATA ENTRY—>FILL PRESCRIPTION–>VERIFY PRESCRIPTION–>PICKUP PRESCRIPTION

BUCKET COLORS (Pharmacy Tech/Pharmacist organize accordingly

BLUE- prescription to be picked up in 1 to 2 hours

RED– prescription to be picked up in 15 to 45 minutes

GREEN– prescription medication is high dollar; pickup likely next day  

YELLOW-prescription has an issue ( order needs clarification, call pharmacy benefit plan, etc.)

BLACK– prescription to be compounded

WHY we WORKFLOW

Workflow improves patient safety. Please keep with the workflow to better serve our patients.


 

This is what works for me as the manager of a pharmacy. The buckets allow me to remain efficient and organized. Both Technicians and Pharmacist can be on the same page with a simple color cue.

I know some people will think this is entirely too much! I would completely understand if you felt that way. It’s an idea…consider it and think of ways that you can tailor it to fit your own practice. I use this technique for pharmacy, however this same technique could possibly be used in the operations of other business models.

Is your business predicated on “volume” to maintain appropriate profit margins? Colored buckets are a cheap investment and can potentially increase your worker’s efficiency. Increased efficiency will increase worker output. Maintaining appropriate output very well could be the difference in business success or failure. IMG_3806


Sam Blakemore is the Pharmacy Manager of Peds Rx Pharmacy Solutions. Connect with him via: LinkedIn

What to consider when your child is prescribed a compounded medication

Extemporaneous preparation of oral suspensions, creams, and ointments by pharmacists is of great importance for the pediatric population. Why? The “one size fits all” model doesn’t work for kids. Dosing for kids is mostly weight-based and is calculated milligram(drug)/kilogram (child’s weight) or dosed based on the child’s body surface area. Most compounded preparations for pediatric patients are considered to be “simple compounds” in that there are only 2 to 3 ingredients in the compound; the drug (crushed tablets or bulk powder) and a suspending agent (simple syrup, ora-blend, cherry syrup).

Parents needing compounding services for their children run into road blocks because not every pharmacy compounds. My suggestion for parents is that they discuss with their pediatrician where compounding pharmacies are located in their area before leaving the doctor’s office or hospital. Parents, if you’re uncertain if a drug needs to be compounded, please ask the pediatrician when he or she writes the prescription.

Typically the pediatrician will be aware of community pharmacies in the area that provide compounding as a service. Some pharmacies in your area may even solely focus on pediatric patients.

When the parent finds a pharmacy they want to use by physician referral, web search, or even word of mouth please give that pharmacy a phone call to ensure that the pharmacy accepts your child’s insurance.

If you have questions or concerns about the compounded medication your child will receive never hesitate to ask to speak to the pharmacist on duty or the pharmacy supervisor. Consultation should always be offered, but never hesitate to speak up on your child’s behalf. The pharmacist should be able to provide information about the drug, how the compound is prepared, how it should be stored, and be able to discuss side effects and concerns that parents typically have with the associated compounded medication.

Lastly, parents please give the pharmacy sufficient time to compound the medication. Compounding is a process that shouldn’t be rushed. Pharmacists must work with their staff to ensure the proper protocol for compounding is followed to ensure patient safety. Typical turn around for compounded medications can sometimes be 24 to 48 hours depending on the pharmacies volume and workflow.

For information about compounded medications please check out the FDA’s website regarding the topic: https://www.fda.gov/drugs/guidancecomplianceregulatoryinformation/pharmacycompounding/ucm339764.htm

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Sam Blakemore is the Pharmacy Manager of Peds Rx Pharmacy Solutions. Connect with him via: LinkedIn

Pharmacy workflow—what’s yours?

Business Management folks love discussing LEAN and KANBAN among ways to ensure quality and inventory control in manufacturing. The overall gist to these concepts is to make things work efficiently, accurately, limit waste, and ensure safety to a manufacturing process. Thus, cost of goods for the consumer can be competitively priced.

So, lets take a minute and think out loud or on paper.

  • What is your pharmacy’s workflow?
  • What happens when your technician gets sidetracked by an insurance issue?
  • What happens when a prescription that should take 15 minutes to fill becomes a prescription that takes 1 hour to fill?

Typical pharmacy workflow is drop off — order entry — fill prescription — pharmacist verification — pickup. This flow becomes so routine that I believe pharmacists sometimes forget how important the “routine of pharmacy workflow” is vital to preventing medication errors.

Practicing pharmacists all understand how things can become sidetracked in the pharmacy fast. A prescriber phones in a new prescription, flu shots need to be given, there’s a patient consultation that needs to be completed, and oh by the way you still need to check prescriptions.

In most chain pharmacies you can stand the waiting room of the pharmacy and quickly pickup on pharmacy operations and how workflow is necessary to keep pace with prescription volume. But even if you’re a pharmacist working for a chain, are you able to realistically follow your company’s workflow for prescription verification or have you tweaked the workflow a bit to get through your day on the job? For the independent pharmacist managing or owning a pharmacy, is your workflow in place and if so is it on paper?

LEAN principles originated with Toyota’s production of cars, and much like Toyota the pharmacy needs to stay LEAN to prevent defects. Defects for Toyota equaled bad cars, defects in pharmacy mean medication errors.

And while ensuring appropriate workflow can’t eliminate all errors it sure can help ensure a level of confidence that if an error does occur during the course of the day, hopefully that error can be caught before the prescription leaves the pharmacy.

Pharmacy workflow is such a foundational concept, but the basis of workflow and operations management are often not discussed with routine during pharmacy school and often glossed over while on the job. Be a good coach to your technicians. Focus on foundational concepts. A good basketball coach has their players practice free throws. A good baseball coach makes sure their players catch the ball with two hands.

As a good pharmacist coach, you need to discuss workflow issues daily. Technicians need to understand their positions in the pharmacy and with time be able to rotate from drop off, pickup, order entry, and filling. Coaching up the principles of pharmacy workflow as it pertains to operations management helps to ensure that patients receive optimal pharmaceutical care while reducing dispensing errors.

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Sam Blakemore is the Pharmacy Manager of Peds Rx Pharmacy Solutions. Connect with him via: LinkedIn

Medication adherence: how parent’s can keep track of their child’s medicine

“Medication adherence” has become a big topic of discussion. A quick Google search of medication adherence as it relates to rising healthcare costs will lead readers to thousands of news articles.

In this article I will discuss some tips on how to help your child adhere to his/her medication regimen.

1.  Pen and paper – If you don’t write it down it never happened. Write down the time and day the medicine was given.

2.  Set the alarm– Set an alarm on your phone so that you can remember to give your child their medication.

3.  Phone apps– There are some phone apps that can be easily downloaded on your smart phone to help track when medications should be administered.

4.  Pill box organizers– Using weekly or monthly pill box organizers can be very helpful for some parents. Discuss with your child’s pediatrician to find out if this is a suitable option for you and your child. First, pill box organizers can’t be used if your child is on liquid medications. Second, the pediatrician will need to discuss with his or her staff to ensure that this can be done safely and effectively by the parent. Lastly, the use of pill box organizers is not suitable for parent’s that can not keep both children and adults out of reach from inappropriate use of the medicine. Appropriate education of families needs to be done by both prescriber, pharmacist, and nurse to ensure everyone is on the same page.

5.  Print off a calendar month– Work with your child’s healthcare team on using a printed calendar month that denotes time, day, and dose to administer to the child. This visual cue will ensure that your child gets the right medicine on the right days. I typically see this method used with kids that are being tapered up, down, or off medicine.

6.  Bottle for school use– If the medication is being administered both at home and at school then you can discuss with your pediatrician about having a prescription written in a manner to have the pharmacy dispense a bottle for both home and school use. For example, a child is to take the medicine at 8am, noon, and as needed at 4pm. The prescriber requests for the pharmacist to dispense a quantity of 90 tablets. The prescriber can write on the prescription to dispense 60 tablets in a bottle for home use and 30 tablets in a bottle for school use.

Remember to do what works. Use one of the methods or a combination of the methods that I’ve outlined. At the end of the day, the only thing that matters is that your child receives the medicine the way it’s been prescribed.

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Sam Blakemore is the Pharmacy Manager of Peds Rx Pharmacy Solutions. Connect with him via: LinkedIn

The cost of pharmaceutical compounding…

“Ya’ll charged me $45, and the pharmacy up the street said they were gonna charge me $400!”

When searching for a pharmacy that compounds; ask the pharmacist if they’re able to file a claim for the prescription under the patient’s pharmacy benefits policy.

If a member of the staff states that the pharmacy can not file the claim under the pharmacy benefits ask the following questions:

  1. Did you attempt to file the claim under the benefits policy?
  2. If an attempt was made to file the claim on the policy; why was the claim rejected? What were the rejection codes?
  3. When the claim was filed under the benefits plan did the rejection message include a phone number?

A typical rejection for a compound claim is ingredient(s) non covered/ product service non covered. The phone number listed on the rejected claim can be used by the prescriber or pharmacist to call on your behalf and gain additional information as to why the claim rejected and if additional paperwork can be submitted on the patient’s behalf to get the compound covered under the patient’s benefits policy.

In regards to pricing — the things that a pharmacy takes into consideration when setting a price are as follows:

  1. Cost of Drug
  2. Cost of Suspending Agents/Flavorings/Preservatives
  3. Compounding Dispensing Fees — this factors in the overhead of producing the final product (labels, tech time, gloves, equipment, etc.)

From there, the pharmacy calculates pricing based on the following principles:

  1. The “Breakeven Price”— this is the price that can be set where the business loses no money.
  2. The price markup factors — Imagine if the cost of producing the product is $5. The business can then say their markup factor is 2. A markup factor of 2 means the selling price is $10. Gross profit margin can then be calculated as (Revenue-Cost)/Revenue. Thus, profit margin in the above scenario is 50%.
  3. Supply and demand — The greater the supply the less the demand and the less supply garners greater demand. Price therefore can shift up and down based on conditions in the market.
  4. Drug shortages in the market can induce price increases.

Be an informed customer at your community pharmacy. Asking questions about compounding can lead some of your pharmacist friends to talk your ear off.

Questioning your pharmacist on this topic will provide that pharmacist with an opportunity to teach, learn, and build trust with a member of their community.

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Sam Blakemore is the Pharmacy Manager of Peds Rx Pharmacy Solutions. Connect with him via: LinkedIn