Changing Hospice Pharmacy Landscape & Facts on Medicare

Published in Hospice, News, Press Releases, on February 21, 2014

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Medicare’s hospice utilization and reimbursement causes uncertainty among the provider community.

West Deptford, NJ (PRWEB) February 21, 2014

Medicare’s recent communications regarding hospice utilization and reimbursement have caused a lot of “buzz” in the industry and uncertainty among the provider community according to recent reports. While it appears certain that the hospice status quo will be disturbed, questions remain regarding the “who, what, where, when and why.” Make no mistake, however, hospices will be expected to cover more of their patients’ medications on a going forward basis. Clearly, hospices need to start preparing themselves to adjust to the “new normal” by reviewing their clinical decision making around coverage and efficacy of medications in end of life care.

Pros and Cons of Per Diem vs. Fee For Service Pricing and the Enclara Models

 Enclara Comprehensive Mail Order Enclara PBM Choice Enclara     Hybrid Traditional PBM Provider
Predictive Costs and Risk Sharing x x
24/7 Access to Pharmacist x x x Not always
Care Kit delivery x x
Formulary Management x x x Not always
Transparent FFS Pricing Model x x Not always
Shipping Costs Included x x
Symptom based Clinical Reference Guide x x x
COP Compliance x x x Not always

Enclara Health understands that hospices have been besieged with offers from existing and new entrants in the PBM hospice pharmacy marketplace touting Fee for Service (FFS) pricing structures as the only pharmacy solution for hospices during these uncertain times.

“The plain truth is that it is the hospice oriented PBMs who benefit most from an FFS pricing model. PBM FFS models typically offer the hospice provider little ability to customize or control its formulary. Less control ultimately leads to more claims being processed… higher pharmacy spending for the hospice provider, and higher profits for the PBM provider,” said Andy Horowitz, CEO, and Founder of Enclara Health. “There is little motivation for the FFS PBM provider to partner with its clients to control utilization. Even though we offer this option for hospices that have internal capabilities and infrastructure to support utilization management, the fundamental truth is that the FFS PBM provider assumes no utilization risk, since they pass all of that risk on to the customers.”

Enclara Health is uniquely positioned as the only provider to offer a full suite of pharmacy service options to the hospice industry. Enclara Health allows its clients to choose among mail order comprehensive, PBM/local, per diem or FFS pricing models – even allowing clients to “mix and match” different models by service location. They help each client build the model of its choice, seamlessly integrating with the hospice provider’s own internal clinical and pharmacy capabilities. This allows the hospice to make economically sound decisions, without compromising the clinical needs of its patients. Also, each of our tailored solutions will position our hospice partners to fully comply with Medicare’s requirements for data collection and reporting (CR 8358). A brief summary of each service option is below:

Comprehensive Mail Order – Medications are dispensed from Enclara’s state of the art pharmacy distribution center and sent overnight directly to the patient’s home via FedEx. Same day needs are met through Enclara’s network of “Neighborhood Connection” pharmacies. These pharmacies have been pre-screened by Enclara Health to ensure that they are stocked with the commonly used hospice medications, inclusive of liquid morphine. The Comprehensive Mail Order model saves on nursing time and expense, as a quick call is made to clinical pharmacists for consultation, assistance in coverage determinations, the therapeutic rationale for medication discontinuation or economical alternatives, and ultimately, delivery directly to the patient’s then current place of residence. There is no need for nurses or family members to pick up medications when the shipment comes directly from the pharmacy distribution center. Pharmacists are also available for “pre-admission” screening services so that hospices are fully informed of their estimated costs prior to patient admission. Enclara is also equipped to assist hospices with impending pre-authorization requirements. They offer services to help facilitate the tracking and receipt of prescriptions for controlled substances. Under this service option, they also conduct Drug Utilization Reviews on a routine basis (admission, whenever a med is changed, and every 15 days), keeping hospice clients in compliance with these requirements. Enclara also offers a “Care Kit” delivery option for each home patient to manage the sudden onset of symptoms.

“Clients have the option to purchase Comprehensive Mail Order services at a per diem rate, with Enclara sharing medication cost risk with the client, or on the basis of fee for service pricing. Our clients have consistently found that per diem cost models provide them the ability to accurately predict and model their drug spend. In addition, this “shared risk” model is not necessarily more expensive than a fee for service model particularly when all costs are accounted for. FFS advocates most often overlook (or fail to mention) a hospice provider’s “soft” costs under the PBM FFS model. Nursing labor is very expensive and the time associated with managing a patient’s medication needs can be significantly reduced under our comprehensive model,” Horowitz said.

PBM Adjudication Services (PBM ChoiceTM) – Prescriptions are filled locally from Enclara’s pre-screened network of Neighborhood Connection pharmacies at competitive “managed care” rates in a transparent cost model. The hospice has access to Enclara’s sophisticated drug portal and can activate, discharge, approve, and/or change medications with a few keystrokes. The hospice has the option of loading its own customized formulary or utilizing Enclara’s evidence and experience-based formulary. The portal has been built with “hard stops” that will reject non-authorized claims from being adjudicated without hospice approval. Demographic and medication information can be manually inputted or interfaced with a hospice provider’s EMR system. PBM ChoiceTM is Enclara’s most economical solution for medication management and puts the clinical decision making in the hands of the hospice, thus eliminating the expense of pharmacist oversight. The program can also be tailored to “a la carte” pharmacist intervention services, such as COP reviews or pharmacist consults. Unlike many PBMs, whose core business is strictly technology-based claims adjudication, Enclara’s team of specially trained palliative care pharmacists remain available, upon request, to assist the hospice in managing its pharmacy spend. This model works well for hospices with very involved Medical Directors or internal pharmacist staffing to provide the clinical expertise ordinarily provided by Enclara in their comprehensive model.

Hybrid model – Enclara’s management team, many with extensive hospice management experience, recognizes the different clinical needs of patients treated at home versus in those treated in an institutional setting. Enclara has found that home-based patients, due to the nature of their terminal condition as well as the absence of multiple caregivers, frequently require more intensive medication management. For this reason, Enclara developed a “Hybrid” model which combines the clinical intervention and delivery services of their Comprehensive Mail Order model along with the economical solution provided by their PBM Choice model for institutional patients.

About Enclara Health
Enclara Health, a privately held company, supports its hospice partners through cost effective, clinical excellence in both mail order and local pharmacy access. Enclara, established in 2007, is committed to meeting the unique and changing needs of the hospice market and truly demonstrate that there is a difference in hospice pharmacy providers.