Providing value for patients depends on offering quality, affordable care. Rising hospital pharmacy costs have a significant impact on the bottom line and have proven difficult for hospitals to control.
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Pharmacists and business and finance experts at Cleveland Clinic teamed to create a solution to unpredictable, burgeoning drug costs. Jeff Rosner, RPh, senior director of pharmacy sourcing and purchasing, and his team built an interactive dashboard to track the 40,000 pharmaceutical products they purchase through their prime vendor. The tool identifies price changes and coordinates them with product uses. Early in implementation, the team identified a price increase in an IV gout medication that would have otherwise been missed. Adjustments in the formulary lead to approximately $50,000 to $80,000 in savings.
Overall, pharmacy cost reductions in 2016 were in excess of $22 million. Rosner offers a few lessons learned for healthcare leaders hoping to reduce pharmacy costs:
- Ensure collaboration between the pharmacy and finance teams.
- Stay aware of the market.
- Work with your group purchasing organization
- Consider biosimilars
- Make your voice heard in the discussion over pricing issues
For more details about the dashboard and lessons learned, visit the feature on the Healthcare Financial Management Association website. To learn best practices in healthcare organizational leadership, explore Cleveland Clinic Global Executive Education programs, including The Cleveland Clinic Way: Intensives, Samson Global Leadership Academy and the Executive Visitors’ Program. All programs cover healthcare finance, and more specific program tailoring is available.