Long-Term Care Keeps This Pharmacy Profitable

longterm care pharmacy profit

Eric Abramowitz, owner of Eric’s Rx Shoppe in Horsham, Pennsylvania, is no stranger to the challenges plaguing the pharmacy industry. ″We’re trying to stay relevant in this super competitive pharmacy space. Decreasing reimbursement, mail order, online pharmacies, DIR fees—all these things are killers,″ he said. ″So it forces us to try to differentiate ourselves and find another avenue for income within filling prescriptions.″

One of these avenues for income has been especially successful for Abramowitz, even amid the increasing pressures of the industry and the pandemic. A few years ago he started serving long-term care facilities in his area and was immediately astonished by the results. ″Why didn’t we do it years ago?″ he asked himself. ″We were just worried about that whole ‘if it sounds too good to be true it must be too good to be true.’″

What exactly sounds too good to be true? For starters, no DIR fees. This benefit alone makes long-term care a reliable way to stay competitive. ″When you start seeing those DIR fees go away, it makes it all worthwhile,″ Abramowitz said.

LTC business not only provides great margins but also increases prescription volume substantially. Between all of his facilities, Abramowitz serves more than a thousand patients. And this volume is reliably consistent, even during difficult times like a pandemic. ″This is business that is always coming in,″ he said. ″So in a time when people aren’t going to doctors, people aren’t taking care of themselves, and we aren’t getting a lot of new business, this is recurring business.″

For a long time Abramowitz was hesitant to get involved with LTC because he thought he would have to become a closed-door pharmacy with a separate building. But once he realized he could serve his retail patients and long-term care patients without changing his business structure, he took the plunge, and now he enjoys benefits from both parts of the pharmacy without all the restrictions and red tape of a closed-door. ″Becoming a combo pharmacy gives us the advantage of being classified as a long-term care pharmacy and reaping some of those benefits of increased reimbursements and no DIR fees, while still being able to continue to service the public as an independent pharmacy.″

READ NEXT: Long-Term Care Opens the Door to Long-Term Pharmacy Profits

Building relationships

Abramowitz has won the business of the local LTC facilities by consistently getting his name, and face, in front of them. ″This doesn’t happen overnight,″ he said. ″It’s a process, it takes time. We have a relationship with quite a few assisted living facilities, but it took a lot of time and a lot of energy.″

Every month he advertises free drug disposal and brings a bin with him to the facility. He shows up with soft pretzels and caramel creams, which the residents love. While he’s there, he answers any questions they have about their medications, even if they aren’t his patients. ″These people look forward to knowing that I’m coming every first Tuesday of every month with pretzels and candy, and people want to come down and just talk,″ he said. ″They’re in assisted living. This has become a social event. We found that going once a month increases our visibility, and visibility is everything.″

He also offers vaccine clinics, with shingles being in top demand. He writes an article once a month in the facility’s newsletter called ″Notes from Eric’s Rx Shoppe.″ He does speaking engagements. He brings sample blister packs to demonstrate how they work, which typically increases enrollment. All of this engagement results in patients who appreciate Abramowitz’s services and tell other residents about his pharmacy, which keeps his business growing. ″Word of mouth is the best and cheapest form of advertising,″ he said.

One of the other advantages of LTC and the assisted living environment is less competition. The chains can’t provide the level of service that an independent can. While the chains are involved within the skilled nursing setting, they are less involved in the assisted living arena. Blister packing of daily meds and a close relationship with the nursing staff separates independents from any competitor, Abramowitz said. ″The chains just cannot compete there.″

Enhanced services

LTC facilities require more from the pharmacy than a typical retail customer. You have to be able to provide a range of services and sometimes be available during non-traditional hours. Some services include medication synchronization, medication reconciliation, blister packaging, and medication reviews. Perhaps the biggest strain on pharmacy operations is deliveries. Abramowitz will sometimes make his final delivery on his way home, often late in the evening. ″You can’t put a price tag on how valuable somebody will think of you when you go out of your way to get them their antibiotic at seven or eight at night,″ he said.

The pharmacy already provides these personal touches and enhanced services, so offering them to the assisted living facilities is just an extension of its community retail business. Abramowitz said, ″We pride ourselves on giving good service and taking care of them. We answer the phone when you call. We do the little things you don’t always get at our competitors.″

Profitable partnerships

These are some long-term care facilities pharmacies can partner with to add a profitable revenue stream.

  • Assisted living
  • Skilled nursing
  • Hospice
  • Subacute care
  • Independent living
  • Active adult living
  • Senior’s home
  • Adult daycare

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