Accountable Pharmacy Organizations?

Pharmacists are typically paid for dispensing drugs. They receive a fee to cover the price for acquiring a given drug and a dispensing fee. In general, however, pharmacists are not paid based on patient outcomes. Will that change?

Troy Trygstad (2020) argues that value-based reimbursement for pharmacists through accountable pharmacy organizations (APOs) may be the answer. How would it work?

Following McClellan et al.’s 2010 roadmap for medical providers, APOs would be legal entities that contract on behalf of pharmacy providers who agree to the provision of enhanced pharmacy services (beyond safe and accurate dispensing) and are willing to take risk on clinical, humanistic, and cost of care outcomes based on performance. Quality measurement starts with “the adoption of core ‘starter set’ of quality, efficiency, and patient-experience measures, making transition to advanced measures emphasizing health outcomes, functional status, and reductions in health risks.” Risk can come in the form of a bonus payment, a penalty, or, in more advanced models, outcomes-based reimbursement in which even the pharmaceutical manufacturer may materially participate. The expression of value would not be based on dispensing metrics, but rather the same metrics of interest for accountable care organizations (ACOs), thus aligning the ACO and APO movements in technology, workforce, and seeking value.

APOs certainly are an innovative idea. But how much do pharmacists really control outcomes? Also, a pharmacist’s definition of high quality care likely differs from that of a physician’s or hospital’s, so quality metrics between ACOs and APOs may not be aligned.

Michael Rupp (2020) notes that while APOs are innovative, a key challenge is making sure pharmacists are reimbursed for their primary job: dispensing medicines. He proposes a three-part reimbursement approach:

First, the ingredient component of reimbursement must reflect verifiable actual acquisition cost of the drug product plus a mutually acceptable gross margin. Second, there must be a dispensing fee that reflects the operating costs incurred by pharmacies to dispense a prescription…As a third component, a supplementary professional fee should be available to recognize the cost and value of pharmacists’ time when they must stop the efficient machinery of the dispensing process to resolve medication-related problems identified during pro-DUR [prospective drug utilization review] or perform above normal counseling for at-risk patients. These targeted professional interventions would be documented and billed using features currently available in the telecommunications standard from the National Council for Prescription Drug Programs that all community pharmacies use to submit third-party claims for conventional prescription care.

Both approaches move pharmacists from pill dispensing machines to true health care providers. The Rupp approach pays for these additional services directly whereas the Trygstad approach pays for them based on quality bonuses.

Pharmacists are highly-educated clinicians and have the potential to greatly improve the health care system. My own research a decade ago showed that pharmacists can improve health care efficiency by administering vaccination…now a common practice. Will pharmacists begin to expand the scope of their practices? Will physicians push back against the encroachment of pharmacists into medical practice? While many questions remain unanswered, what is certain is that the pharmacists role in the 21st century will need to evolve.