With the changing times, and pharmacy gaining more exposure and traction as a revenue generating department, rather than a cost center, it is important we, as pharmacy leaders, continue to evolve and evaluate new opportunities to continue to be business savvy. This may mean we will be pushed beyond our comfort zones, but we should find comfort that we have a network of pharmacy executives and leaders who will work collaboratively together. We are in a unique position, as we must always balance cost savings, revenue opportunities with clinical and professional judgement, which includes limiting risk and predicting the downstream impact of certain decisions. 

As we get out of Covid-19, with a whirlwind of new expectations, including rising costs and shrinking margins have put us in a unique position to be innovative and think differently. One opportunity that may not be novel, in nature, but gaining more attention in the inpatient space is inpatient rebates. When I first heard of the concept years ago, I shut it down immediately; however, with the growing need to find every penny, this has moved from a hard pass and gone beyond exploratory to being a real option. 

As you consider the concept of inpatient rebates, including the vendor you decide to partner with, there are several things you should consider before making a decision to 1) even entertain this concept, and 2) selecting a vendor.

Understand that the business model has been around for a while, particularly in long term care facilities and the retail pharmacy space (particularly between manufacturers and PBMs). As you begin your journey and perform your due diligence, ensure you speak with your colleagues across your network to see if they’re comfortable and how they got comfortable. Equally as important, ensure you work internally with your counsel and other stakeholders, so you do not accidentally cause a negative impact at your organization.

Evaluate the data requirements: Get into the details about what the third party wants vs. what they need to process the rebate, and if that is acceptable for your organization. In a world where data and data sharing is a hot topic, it’s best to know the position of your organization when it comes to data. 

Eligibility: Ask about which medications are eligible and compare that to your inpatient operations. Pay attention to payor mix and 340B eligibility and how that may complicate and impact the potential pro forma. 

Legal: Although your legal counsel will play a significant role in going through the contract and protecting the organization with certain boiler plates and mitigate liability whenever possible, you should take care to understand the process between all parties and see where you and your organization may be vulnerable or at risk. 

Timeline: Be sure to understand the timeline on how and when the data is to be transferred and when to expect the rebate back to the organization. It’s important to set clear expectations for all parties. 

As we embark in new territory and asked to evaluate new ideas, be sure to take a step back and take a 360-lens approach when performing your due diligence.