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Independent community pharmacies are struggling.

We recently attended a pharmacy industry tradeshow to showcase our solutions to pharmacies and hospices. We asked pharmacists how they feel about filling for hospice, and the common responses were, "It stinks," "it's kicking my a**," "It's an abusive relationship," or "It pisses me off."  

But filling for hospice should be a growing industry.

Independent community pharmacies are struggling. Big pharmacy chains, the PBMs they control, discount cards, Amazon, and other threats are making it very difficult for pharmacies to survive, let alone thrive. 

At the same time, the growing number of patients on hospice—and the large number of prescriptions they often require--present a growth opportunity for pharmacies. According to the American Association of Retired Persons, or AARP, roughly 10k Americans turn 65 daily. And according to a survey by Statista, the average number of medications used by the average American over 65 is more than three times the number used between the ages of 26 and 49.   

Unfortunately, filling for hospice is largely unprofitable for independent community pharmacies. 

Our research shows that most independent community pharmacies are losing money serving hospice. As a result, many pharmacies refuse to fill for hospice patients. Others begrudgingly fill for hospice because they sincerely care about their patients, but are only sent the time-sensitive medications hospice PBMs cannot fill via their mail-order pharmacies. 

Why is this a big problem?

The current scenario is bad for independent community pharmacies, hospices, and patients. They often cannot get the critical medications they need when they need them to limit their suffering. 

When a Hospice patient is suffering at the end of life, there isn't time to mail order medications. So without independent community pharmacies being willing and able to fill for hospices, hospice breaks down, and hospice patients suffer. Independent community pharmacies are vital to the success of the hospice industry.

 The real problem: Hospice PBMs are hurting local pharmacies

So why aren't community pharmacies able to profitability fill for hospice patients? The answer is Hospice PBMs. Hospice PBMs engage in three practices that are hurting community pharmacies.

  1. Spread pricing and low reimbursement

First, hospice PBMs often reimburse pharmacies at a loss, hiding behind spread pricing so that the hospice doesn't know how little the pharmacy is getting paid for filling the scripts. One pharmacy we spoke with recently said they lose money 75% of the time when they bill hospice PBMs. Another lamented that he recently spent 30 minutes creating a compound, and upon submitting the claim to the hospice, PBM learned that they were only reimbursed $2.15! Another said he always loses money but continues to fill because he cares about the patients. Pharmacies can't operate profitably and continue to fill scripts with this type of reimbursement. 

2. Mail order pharmacy practices

The second problem is that hospice PBMs with mail-order pharmacies fill up to 90% of the hospice scripts through their own mail-order pharmacy. Which leaves the scripts they can't fill (e.g., urgent, highly stressful, and time-sensitive scripts, as well as compounds) to the community pharmacy to fill. It's common to hear, "It stinks when we get a hospice order because they are always time sensitive and stressful." 

3. Complex processes resulting in higher labor costs per script

Third, it's more expensive for pharmacies to fill scripts for hospice patients because hospice PBMs require that pharmacies do extra work that has nothing to do with dispensing medications. When you ask an independent community pharmacy what takes the most time when filling for hospice, they will typically respond with having to take phone calls and dealing with billing rejections, both of which are required by hospice PBMs. This results in a higher labor cost per script filled than other prescription types. 

Something has to change.

If most independent community pharmacies refuse to fill hospice prescriptions, hospice patients will suffer greatly. The whole purpose of hospice will be impossible to achieve. Getting medications to patients efficiently at the end of life is only possible through local pharmacies. 

There is a better way.

Luckily, there is a way to make filling for hospice profitable again for local pharmacies. At BetterRX, we help ensure local pharmacies are paid fairly for the critical work they do filling prescriptions. Most scripts are sent to local pharmacies by hospices via our hospice-specific ePrescribe app. We send every script possible through the local pharmacies with our hospice-specific ePrescribe app. This helps hospices get the medications they need quickly and makes pharmacies more profitable as they fill for hospice. 

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