Transparency key amid rising care costs

The underlying economics of health care going forward, where providers are incentivized to manage better health outcomes even as the cost burden continues to shift to the consumer, will favor retail pharmacy in the coming decade, suggested Jane Sarasohn-Kahn, health economist for Think Health.

(To view the full Retail Health 2027 report, click here.)



Retail pharmacy is not only an efficient point of healthcare access, it also has cost transparency for value-driven health services.



“When I go to the doctor or the hospital, it’s rare that I know what I have to spend, and it’s never that I know what my outcome is going to be,” she said. “[Retailers] can guarantee an experience and a bundled price. It’s not just cheap; it’s what am I going to get for an expected product or service.”



This past fall, Kaiser Family Foundation conducted a survey that found healthcare cost concerns were top-of-mind among Americans. “The No. 1 pocketbook issue above ‘paying my rent,’ ‘paying my utilities’ and ‘buying food,’ is healthcare costs, whether I’m lower income or have $90,000 per year or more,” Sarasohn-Kahn said. Despite household income, it’s still the leading concern, she said, because it’s so hard to plan for.



The cost of health care for the average American is almost $26,000, Sarasohn-Kahn noted, and the average employee is bearing about 20% of that cost. That’s a lot of money, especially when you don’t know where it’s going.



“We just learned from CMS, we’re spending $3.4 trillion on health care in the United States,” Sarasohn-Kahn told Drug Store News. “[It’s an] unsustainable model; it has to shift toward a value-based payment, which has been slow to come but will be fast [when] implemented,” she said. In just two years, 50% of all Medicare payments will be based on value, she said. “2018 is months away, not years,” she said.



A lot of that value-based care is based on patient experience, another area in which retail pharmacy excels. “Retail pharmacists know how to deliver retail-level care, not so much hospitals and doctors,” Sarasohn-Kahn said. “Pharmacists are very highly valued by American consumers,” she added. “You’ve got this convergence now where these newer entrants [to care delivery, such as] pharmacies, can really deliver on customer experience and data.”