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Contributing Editor Fred Gebhart works all over the world as a freelance writer and editor, but his home base is in San Francisco.
How the right partner can help protect the independence of community pharmacy.
AmerisourceBergen and Good Neighbor Pharmacy bring a broad network of business experts who can help with everything from buying your first pharmacy through selling your final pharmacy before retirement and maximizing profits during the decades between. Good Neighbor Pharmacy supports the entire life cycle of pharmacy ownership and profitability.
“Pharmacy is evolving and pharmacy owners have to evolve with the profession,” says Jennifer Zilka, Good Neighbor Pharmacy’s group vice president of Field Programs and Services.
“Pharmacists go to pharmacy school because they want to help patients. The running of the business side is often secondary in terms of their own priorities. That is why it is so important to have partners who can help them identify what kind of opportunities will make the most impact for what they want to do in pharmacy. Our goal is to give our pharmacists more time with their patients.”
It starts with buying a pharmacy. Good Neighbor Pharmacy’s Pharmacy Ownership Program matches pharmacists who want to sell with pharmacists who want to buy. And because sellers are most often existing Good Neighbor Pharmacy members, the prospective buyer has access to detailed sales and operations data that a typical buyer can only dream about.
At the same time, Good Neighbor Pharmacy’s banking partners are ready to offer the best terms. They know the new pharmacist-owner will be in good hands with Good Neighbor Pharmacy business partners, consultants, and coaches. Good Neighbor Pharmacy’s business support network gives pharmacy owners important business and financial advantages.
AmerisourceBergen’s Pharmacy Services Administrative Organization (PSAO), Elevate Provider Network, doesn’t just negotiate contracts, it constantly monitors and reevaluates contract performance and changing market conditions. Detailed data from every Good Neighbor Pharmacy informs every step of the process.
“We know the insurance cards patients at each of our stores are using,” says Chuck Reed, AmerisourceBergen’s vice president for Pharmacy Innovation and Solutions. “We see every claim, we know the patient population, and we can see details like patient sensitivity to copay changes that aren’t always obvious at the store level. We have the data that prompts us to make some tough calls and the gumption to stay with those calls.”
In 2017, for example, AmerisourceBergen recommended that pharmacies not join a preferred provider network offered by one of the largest health plans in the nation. Data showed that the plan population was loyal and had a large proportion of low-income-subsidy Medicare patients. Pharmacies could maximize reimbursement by staying out of the preferred network and focusing on Medicare scripts.
“Not only have we not lost patients by not joining the preferred network, in this case, we are up double digits in that plan this year,” Reed says.
Elevate’s proprietary pharmacy analytics system, InSite, help pharmacies track and review every claim. Other programs help pharmacies correct rejected claims to move toward 100% reimbursement.
Inventory management is another vital issue.
“Independent pharmacists have a tendency to want to have every product all the time,” Zilka explains. “It goes back to wanting to help their patients. We can help pharmacists tailor their inventory to have the right products on the shelf at the right time so they aren’t carrying excess inventory and cutting into their own earnings.”
Other coaching programs help owners focus on specific areas such as employee training and motivation, front end operations, attracting the next generation of patients, and keeping one step ahead of the competition.
Advocacy is another vital area. AmerisourceBergen’s OurIndependentVoice.com gives independent pharmacists a voice by providing a centralized place to access tools and resources to join advocacy movements that impact care in their community setting, research policies supporting independent pharmacy, access letter templates, write to legislators and connect with other pharmacists and pharmacy organizations.
And when it’s time to sell, the Pharmacy Ownership Program can help once again.
“We like sales three to five years out where we can use business coaching to maximize the value of the business and find the ideal buyer,” Zilka says. “We are not reimbursed for our matchmaking services by our pharmacies, so a deal has to make sense for both buyer and seller or we don’t pursue it. Our goal is to keep independent pharmacies independent. That’s good for our owners and good for AmerisourceBergen.”