Now's the time for retailers to offer 90-day refills

November 7, 2005

With an increasing number of employers migrating to mandatory mail, mail-order fulfillment is the greatest challenge facing retailers. Retail pharmacies should consider offering 90-day prescription retail programs in order to compete with mail-order plans and to meet customer demand. So said Denise Schultz, R.Ph., director of pharmacy support for Supervalu Pharmacies. She delivered this advice to attendees of the NACDS Pharmacy & Technology Conference, held recently in San Diego.

With an increasing number of employers migrating to mandatory mail, mail-order fulfillment is the greatest challenge facing retailers. Retail pharmacies should consider offering 90-day prescription retail programs in order to compete with mail-order plans and to meet customer demand. So said Denise Schultz, R.Ph., director of pharmacy support for Supervalu Pharmacies. She delivered this advice to attendees of the NACDS Pharmacy & Technology Conference, held recently in San Diego.

Emphasizing that prescription benefit plans are undergoing a significant shift in design, Schultz said that two years ago retailers weren't even considering offering extended-day supplies because of low reimbursement rates.

"More contracts started hitting our desks and front offices and it became very clear that this was the direction the third-party industry was headed. Even though there were very poor margin rates, we knew that if we didn't take a look at some of these things, we were not going to be included in that business model," Schultz explained.

"Some of you are losing business-two and even three times a year as employers migrate over to mail order. I don't know how much of that business you can afford to lose," she said.

"Employer groups have a need to reduce their healthcare costs. If they don't think they are going to get it at the retail level, they are going to go to the mandatory mail programs. So we need to be able to be responsive to that," advised Schultz.

Many customers ask Supervalu pharmacists about the prescriptions being filled for them by an outside mail-order facility, and some customers even request a five-day supply while waiting for their mail-order Rxs to arrive, Schultz said. "Here's an opportunity for us to be a supplier of that 90-day supply. There are also opportunities for retailers to move their own employees into an extended-day supply program."

Schultz said Supervalu's goals for participation in 90-day programs included providing integrated care, not just acute care; driving new business into its pharmacies and/or partner stores; arresting the erosion of sales to the mandatory mail plans; and differentiating itself from pharmacies that choose not to participate.

Schultz said some of Supervalu's pharmacists thought Supervalu was caving in to the pharmacy benefit managers. They complained, "How could you take such a low reimbursement rate?" All the while, those who had lost 20% of their business because a major employer was going to mandatory mail "did not think we could get into a 90-day supply plan fast enough."

Schultz recommended that retailers answer the following questions: