Many skilled nursing facilities (SNFs) are preparing to face the challenges that the next decade will bring, especially as the percentage of healthcare patients over age 65 continues to grow and healthcare-related costs are expected to rise 5.6 percent annually through 2025 according to the Centers for Medicare and Medicaid Services. One expense that long-term care facilities often grapple with is rising pharmaceutical prices, as Medicare’s reimbursement rates don’t always cover the full cost of treatments administered to patients.
There are a few ways to mitigate the rising costs associated with your SNF’s pharmaceutical needs.
1. Keep an eye on prescription rates
To better streamline your facility’s pharmaceutical costs, consider negotiating with your supplier to lock in better discounts off average wholesale price (AWP). Also, look at your contract or invoices to review dispensing fees and other hidden costs and address these with your supplier as well. Switching to generic versions, when possible, can also help reduce drug-related costs.
Reviewing costs across other spend categories, like medical supplies, can also help offset costs incurred via rising prescription costs. Your medical supplies vendor will likely be able to recommend alternative lower-cost supply options that don’t sacrifice quality.
3. Don’t be afraid to consider other suppliers or to go out to bid
You should also review your involvement in your current suppliers to ensure that they are meeting your current needs.
If your organisation decides to seek options from other suppliers, consider starting the bid process well before your current supplier’s contract expires so that you have enough time to review offers to ensure you are getting competitive pricing. It’s also worthwhile to evaluate whether a per diem model versus a per drug model would be more beneficial to your organisation.
While you can’t outright avoid rising pharmaceutical rates, you may be able to minimise the overall impact on your facility by working with your suppliers to reduce costs and going out to bid to ensure that you are maintaining competitive pricing.