Independent community pharmacy plays a vital role in health care

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Independent community pharmacy plays a vital role in health care

By Bruce Kneeland - 08/06/2019
Depending on who you talk to, there are roughly 25,000 small chain and independent pharmacies in the United States. Some of these are small family-owned chains like the Marquess Group, with 10 locations in Georgia. But most are single-location pharmacies operated by a pharmacist owner.

There is no question that these pharmacies are dealing with enormous challenges. But whether you own a pharmacy or work for a company trying to sell to them, it would be a mistake to think of them as a dying breed. Yes, profit margins on prescriptions are dropping, but there is good news, and it comes in three major categories.

First, independent pharmacy owners are operating smarter. Technology allows them to fill prescriptions faster and more accurately. But, more importantly, they are finding ways to manage the business aspects of their practice better. And, the owners who have “cracked the code” are buying existing pharmacies and using their newfound business skills to improve the profits on their new stores.

The 2018 NCPA Digest, sponsored by Cardinal Health, reported that 32% of pharmacy owners own two or more locations. That is up from 25% just two years earlier. By spreading operational costs out over more locations and operating in a more businesslike manner, the future of these well-run pharmacies is bright.

Second, initiatives like the Community Pharmacy Enhanced Services Network, or CPESN, are working with pharmacists to help them get paid for services they provide beyond dispensing. CPESN USA, the central organizing authority for the movement, reported that they now have 46 local chapters and more than 2,200 pharmacies enrolled in the program.

Most CPESN chapters are collaborating with state pharmacy associations. Kelly Fine, executive director of the Arizona Pharmacy Association, said, “While our CPESN chapter has not yet met network adequacy so we can seek out payer contracts, I know several other state chapters that have reached this goal. It is exciting to see community pharmacies being recognized and paid for enhanced patient care services separate and apart from the products we dispense.”

The third category where pharmacies are making progress is the growing ability of innovative pharmacists to provide healthcare services on a cash basis. Hundreds of pharmacies have implemented programs that help consumers make the diet and exercise changes designed to improve their overall health. One company providing help for this is Take Charge. Pharmacies enrolled in the program are shown how to set up a separate area in the store, taught how to counsel patients, provided with computer software to support the program, supplied with marketing materials to attract consumers, and then coached on how to charge a fee for the service.

Other examples of services I have seen being paid for out of pocket are drug nutrient depletion programs that improve nutritional supplement sales; point-of-care testing for strep throat detection that help mothers of young children get — or not get — an antibiotic prescription for their children without the need to schedule a doctor’s appointment; and providing individual counseling on bioidentical hormone replacement and charging a fee for that service.

So, the good news is that cost-effective, professional and profitable avenues of growth for independent pharmacy have been found. But, the key to success is no longer as simple as it used to be. Most pharmacies trying to rely solely on dispensing will continue to struggle.

Pharmacy owners who are making the kinds of changes mentioned above are finding success. They are proving independent community pharmacy can play a vital role in the future of our nation’s health care delivery system.




Bruce Kneeland is a community pharmacy specialist and industry consultant.