The Truth Behind Three Health Systems Myths: Part Two
By Alex Minkoff |
Myth #2: All the pharmacy needs to do to save money is buy the cheapest drugs.
Truth: Although a complete misperception, it’s one some hospital leadership teams can’t shake — undoubtedly fueled by dynamic drug pricing. But the ability to manage against the hospital’s budget isn’t tied to drug prices so much as it is to the total drug purchasing picture, including drug manufacturers, wholesalers, 340B programs, GPOs and more. So what do hospitals need to do in order to see the bigger picture? Leverage data. Data is what drives visibility, accurate forecasting and ultimately, savings.
By harnessing purchasing data with diagnostic tools that pull data into a centralized repository and offer advanced reporting, analysis and forecasting, the pharmacy can:
- Identify top areas of drug spend and key drivers of drug costs by drug and therapeutic category
- Evaluate changes over time and measure the impact of utilization and inflation on purchase trends
- Forecast future drug expenditures and measure the effects of cost-reduction efforts
- Explain drug cost increases and variances from planned expenses
- Stay on top of drug shortages and their impact on budgets
- Support pharmacy operations planning and decision making to mitigate drug cost increases and identify drug-cost reduction opportunities
When it comes to the health system’s drug spend, seeing the bigger picture in this way is often far more effective for finding efficiencies and maximizing the impact of medications on outcomes than line item reviews of single drug costs.
In Part 3, we explore the myth surrounding what it takes to manage an ambulatory pharmacy.