Visante’s Top 10 for 2021

View 2023 Top 10 Article

An introduction from Jim Jorgenson

As 2020 comes to a close, we recognize it has been a year like no other! Dominated by challenges and uncertainty with the pandemic and the economy, and the political landscape overshadowing everything. As always, and particularly in the face of rising challenges, we would like to thank our many clients for trusting us to support their organizations and to help them weather the storm as we head into what will hopefully be a better 2021. As we look ahead, as in years past, we are pleased to offer our insight and perspective on what we think will be the Top 10 items for pharmacy to consider in 2021. No doubt many of the challenges we face now will continue into 2021 but with big challenges also come big opportunities and we are very heartened and optimistic about the capability of pharmacy to step up and be a solution to many of these challenges. In 2021, we see expanded opportunities for pharmacy to take a greater leadership role and make larger organizational contributions to quality, safety and finances.

As someone much wiser than I said, it’s important to remember not to get overwhelmed by these challenges but to remember to focus on what we can control which is: what we think, what we say and what we do. At Visante we are thinking and acting to advance the business of pharmacy across all aspects of the healthcare continuum and are looking forward to helping even more organizations in the new year.

1. Pharmacy Organization Structure
2. 340B Program
3. Vertical Integration and Marketplace Restrictions
4. Drug Prices and the Supply Chain
5. Infusion Services
6. Drug Shortages
7. The Pandemic
8. The Economy
9. The Election
10. Social Justice

In Good Health,

Jim Jorgenson

CEO Visante

Pharmacy Organizational Structure

Pharmacy is moving to the top of a lot of lists as a potential resource that has typically been undervalued and underutilized.

For several years we’ve experienced an evolving healthcare landscape that is increasingly focused on value-based care. We’ve heard repeatedly about the quality of care and financial benefits that can be achieved through the development and merging of multihospital health systems. While improved value can be achieved through such alignment, success is highly variable depending on how well systemness and integration occur. Our experience has been that high performance usually boils down to structure, accountability, resource allocation and alignment of expectation. This is true at the system level, and it’s also true within the pharmacy enterprise.

How pharmacy services are provided and how value is quantified varies widely across health systems. Many systems have traditionally fragmented their pharmacy enterprise into varying and sometimes competing silos (ambulatory, inpatient, managed care, supply chain, etc.), that are not well positioned structurally to optimize pharmacy’s full value. Further, pharmacy executives who have successfully grown their ambulatory enterprise into billion-dollar entities increasingly experience internal “tribal warfare” from jealous peers and executives with conflicting priorities. This situation makes the executive e’s job more politically challenging, with title and positioning becoming more important to preserving the core and successfully advancing new programs.

With the current environment being dominated by the unexpected pandemic, health systems are concentrating on strategies to improve operating efficiency, reduce expenses and grow revenue/margin. A large and growing body of evidence exists that demonstrates the many positive outcomes provided by a well-run comprehensive internal pharmacy enterprise, which leads to payers and health system executives becoming increasingly aware of this positive association. Thus, pharmacy is now moving to the top of a lot of lists as a potential resource that has typically been undervalued and underutilized.

Huge variability exists in terms of how health systems position their pharmacy enterprise for success. We see great opportunity when pharmacy operations are all brought together under a unified enterprise structure. Health systems with a pharmacy executive reporting directly to the highest level of system organizational leadership, who is accountable for overseeing and aligning all pharmacy-related clinical, operational and business units, consistently outperform those without such a structure, both financially and clinically.

To this aim, the most successful strategic trend we see being deployed today is the repositioning of the pharmacy enterprise to enable it to be organized and managed in a manner commensurate with how a high-performing business of this magnitude would function – a “Business within a Business” (BwB) model. The BwB paradigm simply means running internal service functions in a comprehensive and entrepreneurial fashion, much as one would a stand-alone business. The BwB approach works to align the incentives of everyone in the business of pharmacy to create an ownership model that engages and empowers teamwork, innovation, efficiency, customer focus, business growth, quality and risk-taking orientation.

The role of a high-performing pharmacy enterprise is multi-faceted and increasingly complex, requiring accountability and alignment in the following areas: strategic planning, business development and oversight, acute and ambulatory care pharmacy operations and patient care service, transitions of care, retail and specialty pharmacy, supply chain and logistics, 340B, revenue cycle management, utilization management, skill mix optimization, site of care (infusion and home infusion) strategy and service management, information technology, indigent patient support program navigation, education, research, compliance and regulatory accreditation, and employee drug benefit design. In addition to all of this, new and more efficient care delivery models that leverage telehealth, as the new normal, to manage patients across the continuum will be a higher priority to help reduce readmissions and costs, especially for patients who are geographically restricted or prefer remote care.

In considering the business of pharmacy, form really does follow function. Strong results rely on aligned structure with clear oversight and accountability. The most successful organizations that we support have all recognized that a comprehensive, integrated BwB approach to pharmacy produces significantly better outcomes than the traditional fragmented/ancillary approaches. Investing in a comprehensive internal pharmacy enterprise will improve patient safety and clinical outcomes, reduce total cost of care, and generate positive financial returns for the organization.

340B Program

There has been a tremendous amount of activity in the 340B space which we expect to continue into 2021. By far the greatest threat to the 340B Program occurred this year when several manufacturers announced plans to restrict shipment of 340B purchased drugs to contract pharmacies. Readers may wish to review our August 21 blog for greater detail. “Manufacturers Create Chaos For the 340B Program,” written by Kristin Fox-Smith (Senior Vice President), Douglas E. Miller (PharmD, Senior Director) and William Wood (RPh, Senior Director).

As the end of the year approaches, none of the manufacturers have reversed their positions. Although, on October 30 Novartis informed 340B hospitals that it will stop providing 340B pricing starting November 16 to hospitals on drugs shipped to contract pharmacies that are more than 40 miles away from the hospitals’ parent sites. In addition, Novartis did take what could be considered a very minor step back when it announced that it would continue to provide “bill-to/ship-to” arrangements to grantees.

These manufacturer actions took place shortly after HRSA stated in July, “the 2010 contract pharmacy guidance is not legally enforceable and its authority to enforce certain 340B policies contained in guidance is limited unless there is a clear violation of the 340B statute.” Without question, this is what emboldened the manufacturers to take their actions. It appears that the manufacturers are relying on a recent statement by PhRMA: “We agree with this Administration’s recent statements regarding the rule of law and status of agency guidance. Unlike laws and regulations, agency guidance cannot impose any binding requirements on the public and lack the force and effect of law.“

In addition to the manufacturer actions against contract pharmacies, 340B hospitals face another year of deeply reduced Medicare drug reimbursement. The Trump administration announced that many hospitals’ Medicare Part B 2021 reimbursement for drugs bought through the 340B program will stay at the same deeply reduced rate it has been at since 2018—average sales price (ASP) minus 22.5 percent. The cuts will be made under the Medicare outpatient prospective payment (OPPS) rule.

In what might be considered a minor victory, CMS decided not to use an alternative reimbursement methodology that would have further deepened the cuts next year to an effective rate of ASP minus 28.7 percent. The cuts will apply to all 340B hospitals paid under OPPS, except Medicare rural Sole Community Hospitals, children’s hospitals, and PPS-exempt cancer hospitals. Critical Access Hospitals are not impacted by the reductions as they are not paid under OPPS.

We all know that the 340B Program is a federal program. It was created in 1992 as part of the Veterans Health Care Act and codified as Section 340B of the Public Health Service Act. But how much do we know the roles played by the states?

State policymakers have authority to regulate, legislate, investigate and conduct other activities impacting 340B both directly and indirectly. State policymakers have historically focused on the relationship between Medicaid and 340B, but in the last few years there has been increased activity and interest in other areas.

States have normally focused their efforts on Medicaid Fee-for-Service (FFS) Duplicate Discount Prevention. The 340B statute protects manufacturers from having to pay both a 340B discount and a Medicaid FFS rebate on the same drug and directs HRSA to develop a mechanism to prevent Medicaid FFS duplicate discounts, resulting in the creation of the Medicaid Exclusion File (MEF).

Covered entities (CEs) are required to submit to HRSA all numbers they use to bill Medicaid FFS for 340B drugs for inclusion in the MEF and CEs must repay manufacturers if an inaccurate MEF listing results in a Medicaid FFS duplicate discount.

However, there are no federal rules regarding CEs’ legal obligations for duplicate discount prevention on 340B drugs given to Medicaid managed care organization (MCO) patients, including repayment to manufacturers. There is a federal rule requiringstates to take steps to prevent Medicaid MCO duplicate discounts, but it does not specify exactly how states should do so. CEs are expected to follow state rules for Medicaid MCO duplicate discount prevention. Prior to 2020, states were actively imposing rules to prevent duplicate discounts (e.g., identification of 340B claims with modifiers, mandatory carve outs).

No federal rule requires reimbursement of 340B Medicaid MCO drugs based on actual acquisition cost (AAC), so the state does not make up for lost rebates. According to the Kaiser Family Foundation, as of July 2017, over two-thirds of all Medicaid beneficiaries received their care through Medicaid MCOs. As a result, 340B comes up in both state financial considerations and policymaking. We expect continued debate to occur in 2021 over the financial benefit of using 340B drugs for Medicaid MCO beneficiaries at the state level.

In recent years, some states have considered or implemented policies that transfer, or have the potential to transfer, the 340B benefit from CEs to the state. One such policy involves the transfer of the pharmacy benefit from Medicaid MCOs to FFS. This policy has been considered or enacted in California, Michigan, New York, Kentucky, and West Virginia, and bears watching in 2021 for expansion to other states.

Recently, California Gov. Gavin Newsom’s administration announced delaying until April 1, 2021 its controversial transfer of Medicaid (Medi-Cal) MCO prescription drug benefits to Medi-Cal fee for service. The state health department announced the new April 1, 2021, effective date for the benefit transfer on Nov. 16, in a provider notice and a news release, citing “the ongoing challenges and constantly evolving health care landscape associated with the unprecedented COVID-19 public health emergency.” The news release said during the delay “prescription drugs services will continue to be delivered under the current system for both fee-for-service beneficiaries and those served by Medi-Cal managed care plans (MCP).”

In addition to policies designed to transfer Medicaid MCO to Medicaid FFS, several states have considered including state-level 340B reporting requirements in their budgets. This has occurred in Ohio, Wisconsin, and Vermont. We are not aware of any states that have enacted 340B reporting requirements to-date. Other state level actions or considerations have included discriminatory reimbursement practices, state regulation of PBMs, access to insulin, and state drug importation. Can we expect to see more? Count on it!

With the House and the White House under Democratic control for 2021 it is unlikely we will see any major attacks on the 340B program legislatively or by executive order, but there is bi-partisan support for increased program transparency and compliance oversight and CE’s should pay close attention to activity in these areas. With the Georgia Senate run offs set for January 5, 2021, a Democratic win and control of the Senate may open the door for legislative actions to curtail the recent moves by manufacturers against contract pharmacy arrangements and to provide more protection for CEs. Legislative relief will be much more difficult if the Senate remains under Republican control.

Bottom line, 2021 promises to be full of activity in the 340B space!

The Impact of Vertical Integration and Marketplace Restrictions into 2021

Mergers and Acquisitions (M&As) have become part of the daily morning routine for many of us in the past few years. Wake up, brush teeth, eat breakfast, read article about a new healthcare-related M&A. This is true for health systems, health plans, manufacturers, health technology companies and pharmacies. In addition to M&As, marketplace relationships and allegiances are shifting and ever-changing. It is not far-fetched to anticipate continued healthcare marketplace metamorphoses in 2021.

It can be challenging to keep up with these changes and predict the direct and indirect impact it may have on your practice or business strategy. However, for health systems these changes in the payer marketplace bring the threats of reduced regional payer competition and potential lockouts or restrictions. Vertical integration creates a story drawing parallels to David and Goliath, where community-based health systems are battling large corporations with power, money, and shareholders. These battles have become most frequent in the area of specialty pharmacy, impacting both take-home and infusible medications. As the cost of new, innovative therapies has risen in the past 10 years, it has set off a chain reaction within the healthcare payment marketplace.

Prescription benefit managers (PBMs) try to limit the usage of higher cost products, placing medications on higher tiers and requiring prior authorizations with demonstrating medical necessity. However, where there is negative impact for plan sponsors for higher cost products, there is value to the dispenser of the product (e.g., pharmacy). Product mix has become increasingly important in retail pharmacy, where generic and brand reimbursement has diminished as specialty cost and reimbursement has increased. This has created a ‘capture the flag’ scenario for dispensing specialty prescriptions among pharmacies. Vertical integration has changed the rules, as PBM-owned or -affiliated specialty pharmacies have effectively walled off all other competitors through restricted networks.

On the medical benefit side, health plans view hospitals as high-cost sites of care and enact mechanisms to reduce the traditional buy-and-bill model for clinic-administered and infused medications. Mechanisms include restricting the site of care to non-hospital-based infusion sites, forced white bagging and incorporating contract language and policies that make it harder for health systems to be reimbursed. These methods not only increase the administrative burdens on healthcare providers trying to help patients navigate the system, but also fragment care and increase likelihood of patient safety events.

Despite these challenges, there is growing awareness about the services offered by health system specialty pharmacies. Efforts are being undertaken to limit white bagging due to patient safety concerns. Health systems are gaining traction with small victories to gain access to restricted payer and manufacturer networks. Health system pharmacy leaders are working with their employee health plans to look inward for specialty pharmacy services. Trade organizations and coalitions are putting a much heavier focus on advocacy efforts and leveraging collective health systems power. There is growing research demonstrating the value of health system pharmacies in improving patient outcomes. These battles will continue in 2021, and health systems should expect continued efforts by large marketplace competitors to limit health system service offerings.

Six Important Trends Impacting Supply Chain and Drug Pricing

For most of 2020, the pharmaceutical supply chain has been stressed and overshadowed by the pandemic. Drug shortages, which earned a “Top 10” spot on its own, have been the main headliner. Most recently, the focus has shifted to being able to procure and manage the much-anticipated COVID vaccine. As more vaccines are approved, the challenges will only increase as more volume hits the market. Beyond the COVID vaccine, what else can we expect to see in 2021 related to the pharmaceutical supply chain and overall drug prices? Here are a few thoughts.

1. Overall decrease in the buy-and-bill model: During the first few months of the pandemic, we saw a large decrease in buy-and-bill volume. This was driven by an overall decrease in services secondary to the pandemic and a move to home infusion services where a larger portion of utilization is shipped to the home infusion provider or the patient’s home from specialty pharmacies. While we expect the buy-and-bill model to recover from the lows that we saw at the beginning of the pandemic, we do not expect to see a full recovery. This is due to patient and payer preference for home infusion services and a continued push by payers to move away from buy-and-bill model to take advantage of lower cost sites of care.
2. Increase in spend on home infusion therapies: As outlined in #1, an increase in the use of home infusion services is likely here to stay. As a result, we expect an increase in therapies that are commonly used in this space. Additionally, we expect some providers to become more aggressive in the therapies they are willing to administer in the home setting, including biologics (specialty drugs) which are traditionally administered in infusion clinic settings.
3. Continued uptake in biosimilars: Over the past few years, we have seen an increase in the adoption of biosimilars. Due to the financial pressures of the pandemic, we expect health-systems to become more aggressive in their efforts to accelerate the uptake of biosimilars. Additionally, we expect payors to continue their adoption, especially those who are vertically aligned with providers. This adoption should pave the way for uptake of some larger market biosimilars set to launch in the coming years (ex: Humira)
4. Price increases for specialty pharmaceuticals: I am sure it will be a shock to all, but we expect specialty pharmaceuticals, which drive most pharmacy budgeted, to take price increases this year. We expect these increases to follow past trends.
5. New launches of specialty and orphan drugs: The pharmaceutical pipeline is filled with specialty and orphan drugs that will continue to put strain on pharmacy budgets. Additionally, due to the pandemic, some FDA approvals were delayed, or the manufacturer chose to delay product launch. Expect a push to increase utilization of these products early in 2021. One drug to watch is aducanumab, a drug for Alzheimer’s disease. In November, an FDA advisory committee issued a negative vote on the drug; however, a final verdict is not expected until March 2021. If approved, aducanumab is a potential $15 billion drug that will alter budgets and put pressure on infusion capacity.
6. 340B changes: Yet another topic related to drug prices and supply chain that has its own “Top 10” spot. This is an area that everyone should be closely monitoring due to the implications on the overall pharmacy budget.

In 2020, many pharmacy budgets experienced a drastic decrease in spend early in the pandemic secondary to a decrease in infusions of high-cost therapeutics. In 2021, while the pandemic is still ongoing, we do not expect this trend. Rather, we expect an overall budget increase secondary to price increases and new launches of specialty and orphan drugs. The impact of buy-and-bill changes will depend on the hospital or health-system. For those with a specialty pharmacy and/or home infusion pharmacy, the change may be minimal. Finally, the adoption of biosimilars will offer some relief to the growing pharmacy budget.

Hospital-based infusion services important growth area for 2021

Factors for success include collaboration, holistic approach

For 2021 hospital-based infusion services will be an area of increasing emphasis. As hospitals and health systems scramble to recover financially from the pandemic, infusion services have become an important avenue for many organizations.

Infusion services are also an area where hospitals and health systems need to be aware of the current managed care contracting environment and changes with regard to site-neutral payment or site of care challenges. The U.S. Court of Appeals ruled in July of this year that Health and Human Services was within its rights to reduce payments to hospital outpatient departments. This decision reversed a district court’s earlier decision on action brought by a group of hospitals that claimed this rate reduction fell outside of HHS’ statutory authority. The case addressed HHS’ decision that the Medicare payment differential between hospital outpatient facilities and independent physician practices “gave rise to economic incentive that induced unnecessary growth in the volume of outpatient care” provided at hospital outpatient sites. HHS therefore reduced the rate it paid hospitals for patient evaluation and management so it was equal to the rate physician practices received for that service. We are seeing growing interest and actions from private payers around the country to also follow suit with site neutral payments for services like infusion.

Hospitals would be well advised to consider their infusion strategy to protect as much of this business as possible from shifting to external infusion providers. Creating a robust infusion strategy must include more than pharmacy to be successful in this constantly changing environment. Collaboration between all stakeholders including revenue cycle, care management, prior authorization services, provider offices, scheduling, nursing AND pharmacy is key.

Organizations are also taking a more holistic approach to infusion care covering all potential sites including home infusion. Many hospitals and health systems have had home infusion services but got out of the business several years ago due to increased competition and payor rates. Now there has been market contraction and with the pandemic raging and more patients are opting for therapy at home – in some cases, even chemotherapy – which is again fueling interest in adding home infusion services to the overall infusion portfolio.

We also see more organizations exploring the creation of hospital owned non-HOPD based infusion programs to give them a full range of infusion options from HOPD to non-HOPD to home infusion. This strategy provides maximum flexibility in determining payor contracts and site of care to support capture and retention of as much infusion business as possible.

Here are three things hospitals should be doing now in preparation for 2021:

• Understand with your managed care contracting group what is happening with your top payors, contracts coming up for negotiation and any language referencing site of care.
• Survey your organization for sites of care (HOPD, non-HOPD, home infusion), chair capacity and any external relationships for providing this care.
• Develop a strategy to retain care within your system and get help early before you are in a reactive mode.

COVID19 Exacerbates U.S. Drug Shortage Issues

If there was any hope for a mitigation of drug shortages in the U.S. during 2020, COVID19 pretty much kicked those thoughts to the curb in the first few months of the past year. The usual myriad of impact factors, such as the scarcity of certain chemical precursors, active and inactive pharmaceutical ingredients needed for finished drug product production within the U.S. and worldwide, continued to impair the consistent supply of needed medications within the U.S. As a result, healthcare providers continued to struggle with hundreds of key drug shortages throughout the past year. The pandemic added additional strain to the pharmaceutical supply chain through the repurposing of available manufacturing lines and sites to the slowdown of plant inspections due to the pandemic impact on travel and staffing at pharmaceutical plants both in the US and abroad. In fact, the American Society of Health-System Pharmacists (ASHP) noted that 29 out of the top 40 (72.9%) critical drugs for the treatment of COVID19 patients were unavailable or in short supply during the past year.

From a historical perspective, from 2015–2019, new annual medication shortages increased consistently from five to 31. However, in the first six months of 2020, 27 new shortages were announced in 2020 accounting for 87% that of the total number of shortages reported in 2019 in half of the time. Clearly, the COVID19 pandemic has further exposed to other healthcare providers, patients, policy makers and now even the general public, what those of us in pharmacy practice have known and experienced for at least the last decade. Drug shortages in the U.S. are real, a growing problem with no quick and easy solutions and require significant dedicated resources to manage and result in increased costs for our respective health care organizations in order to assure the continuation of both life-saving and elective patient care treatments and services.

As noted previously, in 2019 the FDA led an inter-agency Drug Shortage Task Force which produced a comprehensive report regarding the root causes and potential solutions for addressing the U.S. drug shortage issue. An updated report was issues in February, 2020, and is available on the FDA website at https://www.fda.gov/media/131130/download.

To recap, the report identified three root causes for drug shortages:

1. Lack of incentives for manufacturers to produce less profitable drugs.
2. The market does not recognize and reward manufacturers for “mature quality systems” that focus on continuous improvement and early detection of supply chain issues.
3. Logistical and regulatory challenges make it difficult for the market to recover from a disruption.

The report also recommends several enduring solutions to address drug shortages, which include:

• Creating a shared understanding of the impact of drug shortages on patients and the contracting practices that may contribute to shortages,
• Developing a rating system to incentivize drug manufacturers to invest in quality management maturity for their facilities, and
• Promoting sustainable private sector contracts (e.g., with payers, purchasers, and group purchasing organizations) to make sure there is a reliable supply of medically important drugs.

Also, the report described legislative proposals in the President’s FY2020 Budget and planned FDA initiatives to prevent and mitigate shortages that look at improved data sharing, risk management, lengthened expiration dates for drugs, and internationally harmonized guidelines for a pharmaceutical quality system. Given the lack of any significant definitive outcomes on these proposals or the recommendations in the FDA report in the past year, the likelihood is that most of not all of these proposals succumbed to the prioritization of the pandemic efforts and 2020 Presidential election, let alone additional political and other influencing factors. It remains to be seen what, if any focus will be undertaken by the Federal government under the new Biden administration in the upcoming 4 years.

Still, there are some bright spots starting to shine on the horizon for 2021 and beyond. As previously announced, consortium-based startup contract pharmaceutical manufacturing companies such as Civca Rx are attempting to address critical drug shortages for their members in particular. The pharmaceutical industry is continuing to explore “fill and finish” plants (particularly related to injectable drug products) as well as the potential transition to automated continuous manufacturing processes versus traditional batch processes to improve pharmaceutical production line utilization with a potential reduction in the occurrence of drug shortages. Additional longer-term considerations in the number and geographic diversity of pharmaceutical manufacturing plants versus the current consolidation of these facilities may hold additional hope for the reduction of drug shortages longer term.

While all of this is certainly a step in the right direction there is still a considerable amount of change that must occur if drug shortages are to be effectively mitigated and controlled. There appears to be a growing recognition and amongst key stakeholders that the U.S. pharmaceutical supply chain is complex, has multiple stakeholders and as further exposed by the COVID19 pandemic, has a number of vulnerable points Further, it depends upon cooperation with multiple foreign countries (most notably China and India) for its most basic ingredients in order to produce readily available, safe and high quality finished drug products. In reality, this fact alone constitutes an urgent national security issue for the well-being of our country’s citizens from natural health causes, let alone acts of terrorism or war. Finally, it will likely take all stakeholders in the U.S. pharmaceutical manufacturing process, from the federal government legislative and policy making agencies to the ingredient suppliers, pharmaceutical manufacturers and healthcare providers effectively redesign the current U.S. drug supply chain.

Unfortunately, it is also widely recognized that this redesign will likely take years to achieve and be the result of innovation on the part of multiple stakeholders with perhaps minimal guidance let alone mandates from the federal government. As such, for 2021 and likely well beyond, health care systems and providers would once again be well advised to continue to formalize and budget appropriate personnel resources and increased acquisition costs for their own shortage risk mitigation strategies and programs.

Accessed Dec 22, 2020

https://www.fda.gov/drugs/news-events-human-drugs/modernizing-way-drugs-are-made-transition-continuous-manufacturing

https://www.pharmacytimes.com/news/how-to-address-the-public-health-crisis-of-drug-shortages

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7378009/

https://www.cidrap.umn.edu/news-perspective/2020/10/report-details-covid-19-drug-shortages-and-solutions

https://cen.acs.org/business/outsourcing/Bringing-drug-production-back-US/98/i25=

The Pandemic – Pharmacy Community Continues to Rise to the Challenges

2020 was dominated by the COVID-19 pandemic and expectations are that this will continue for the majority of 2021. Specific areas of the country, most notably the New York City area, experienced tremendous surges of patients that greatly stressed the entire health care system. We are now experiencing record numbers of cases and deaths across the country as the virus has continued to spread and hospitals all over the country are at capacity in terms of space and resources to care for these patients. In addition to the surges in patient volumes, we have experienced shortages of PPE, shortages of respirators, critical drug shortages and shortages of COVID tests and testing reagents. Despite these issues, the health care community continues to rise to the challenges created by the virus.

Pharmacy across the country has played a critical role in mitigating the drug related challenges and in supporting the rational and evidence-based application of COVID related drug therapy. Rapid dissemination of accurate drug information for COVID therapies has been a vital function for pharmacy during the pandemic. Pharmacy has also played a role in supporting public health measures to mitigate the spread of the virus through continuing education efforts around the proper use of masks, contact tracing, testing and social distancing. We expect all of these pharmacy related activities to continue into 2021.

The work by the PhRMA/Biotech/Academic Research community around the world to create an effective COVID vaccine has been amazing. New techniques have been developed using M-RNA to create vaccines in record time. Where vaccines generally take 4-5 years to create and test, the world working together has been able to create vaccines in one year. However, the Pfizer vaccine must be stored at ultra-cold temperatures, which create subsequent cold chain distribution and storage challenges. The Pfizer and Moderna vaccines also require two doses approximately 21-28 days apart, which creates further logistical challenges. To get the vaccine out to as many people as possible in as short a time as possible is a major logistical effort and pharmacy is playing a key role in the distribution administration and monitoring of the vaccine.

We expect the pandemic to dominate the health care landscape for the majority of 2021 and do not expect that the continued development and release of COVID vaccines will be a “magic bullet” that will eliminate the virus. It will likely be third quarter 2021 until a sufficient number of people are vaccinated to begin to have an impact. We are optimistic that the Biden/Harris administration is working to address the virus much more aggressively and is using national experts and the CDC to create and deliver a science-based plan of attack.

Hospital Pharmacy and the Economy – Big Challenges Equate to Big Opportunities in 2021

While the pandemic has stressed the entire health care system it has also negatively impacted the economy. As business and travel has shut down or been greatly reduced in an attempt to slow and contain the spread of the virus the impact on the U.S. economy has been devastating. We have seen record numbers of people losing their jobs and with that comes the loss of employer sponsored health insurance further stressing an already compromised health care system. The government has responded with stimulus packages but political gridlock around the 2020 elections prevented the timely delivery of continuing support in October/November.

Hospitals have also felt the impact economically of the pandemic. In the second quarter of the year as the virus began to spread in earnest, hospitals responded by canceling the majority of elective procedures and reducing census to focus on COVID patients. As a result, most hospitals experienced significant financial losses in the second quarter and are struggling to make up those losses. The government support through coronavirus relief funds has not been enough to offset the financial losses for many organizations and they have been left to figure out how to stay financially viable.

With every big challenge however comes big opportunity, and hospital pharmacy around the country has stepped up and offered solutions to the hospital financial challenges. With drugs as the fastest growing expense in U.S. healthcare and also a primary source of revenue in the outpatient environment, pharmacy has been aggressively expanding programs for hospitals that positively impact expenses and revenue/margin. Pharmacy has been expanding and working to effectively deliver financial value in a variety of areas including:

• Specialty Pharmacy
• Retail/Mail Order
• 340B Program Optimization
• Infusion/Home Infusion Services
• Indigent Patient Support Programs
• Pharmacy Revenue Cycle Optimization
• Drug Utilization/Expense Reduction
• Consolidation of Services/Central Service Center Development
• Enhanced Technology Application/Remote Services
• Labor Efficiencies
• Employee Pharmacy Benefit Design
• Supply Chain Efficiencies

Too often around the country, pharmacy has been an undervalued and underutilized resource for many hospitals but the pandemic is forcing organizations to consider all possible means to combat the virus and its economic impact. Pharmacy can and should be a major consideration in meeting these COVID related challenges.

2020 Election and the Impact on Healthcare

To say that the recent election was contentious would be an understatement. In terms of health care the presidential candidates were diametrically opposed, with President Trump favoring repeal and replacement of the Affordable Care Act and President-elect Biden favoring an enhancement of the ACA. With the Biden/Harris ticket winning the election we can expect them to work on a number of changes including:

• Expansion of coverage access
  • Lowering of Medicare eligibility age
  • Creation of a Public Option plan
  • Premium free access to the Public Option plan for residents of states that chose not to expand Medicaid
• Enhanced tax credits to lower premiums
• Lowering drug prices
  • Allowing Medicare to negotiate drug prices
  • Limiting launch prices of drugs
  • Limiting price increases
  • Eliminating tax breaks for drug advertising
  • Improving the supply of generic drugs
• Addressing maternal mortality rates
• Investing in more community health centers
• Expanding access to mental health care
• Eliminating co-payments for physicals, vaccinations, vision and hearing screenings, and preventative dental checkups for children of all income levels.
• Prohibiting employers and insurers from collecting or using genetic discrimination when making decisions about hiring or providing health care coverage, including the cost of a policy.
• Investing at least $1 billion yearly to help hospitals, physicians and other health care providers move to electronic health records systems.
• Adding 100,000 new nurses to the workforce in the next five years and establishing scholarship and loan repayment programs to encourage people to join the public health workforce.
• Increasing access to treatment services for opioid use disorder, curbing opioid prescriptions and prosecuting pharmaceutical companies that helped feed the nation’s addiction problems.

While the Biden/Harris health care plan is extensive, the ability to implement all of this hinges on two key but yet to be determined outcomes. First is the current challenge to the legality of the entire ACA by a group of Republican state attorneys general. The case is currently before the Supreme Court where the argument centers on whether striking the individual mandate from the ACA invalidates the entire ACA. Should the court rule in favor of the Republican argument the ACA could be eliminated and the country would be left with no national program. The second issue is control of the Senate. With Majority Leader McConnell’s history of opposing the ACA, it will be very difficult to get any expansion of the ACA outside of Executive Orders through the Senate. However, if the Democrats win both of the run-off Senate elections in Georgia, they would in effect control the House and the Senate making it much easier to pass the ACA measures favored by the Biden/Harris plan.

At the core, any government plan for health care should be able to pass a general litmus test. The questions for any plan should be around whether or not it:

1. Increases access to health care for more people
2. Improves outcomes of the care delivered
3. Reduces the cost of health care

The Biden/Harris plan would appear to be positioned to positively address these concerns but time will tell how much can be implemented and what the ultimate impact of the changes may be.

Pharmacy Can Play an Important Role in Social Justice

For much of 2020 the country has struggled to address the issue of social justice and equality and, while this issue transcends health care, it is an important element of our health care system that will receive more attention in 2021 under a Biden/Harris administration. In her article on this topic, nursing leader Mary Atkinson Smith stated, “Our health care institutions must be balanced in a way to avoid monopolies that create unfair barriers, leaving vulnerable populations unable to obtain needed health-related services.”

Social justice seeks to ensure that the distribution of healthcare services and resources occurs equally and benefits vulnerable populations to the same extent as more affluent populations. The overall goal of social justice is the promotion of equality for all in access to healthcare and in the quality of the care received. This is becoming more critical In the U.S. today as we are dealing with growing numbers of vulnerable populations. This is in part driven by a growing shift in income inequality; a shift in population demographics with an aging population and an increasing minority population; an increase in chronic disease prevalence; and a decrease in health care resources for low-income communities.

As noted earlier, social justice overall is a focus for the Biden/Harris administration. In terms of health care, U.S. maternal mortality rates in minority populations are significantly higher than the general population as a prime example of a disparity that needs to be addressed. Greater access to quality care is planned around significant expansion of community health centers. More funding and access to care for mental health is planned. Greater support for addiction treatment and prevention is also planned. And, overall, greater access for all Americans to health care coverage is planned with a particular emphasis on low-income and more vulnerable populations.

At the same time that these issues are being addressed there is also a need to educate ourselves to create a better understanding of the issues that minority populations face, not only as patients, but also as members of the healthcare community. Ensuring that our workforce and leadership teams are representative of the populations we serve will be an important element of the 2021 social justice movement. Pharmacy should be cognizant of what is needed to ensure that our profession recognizes and addresses this need in 2021 and beyond.