Transforming the pharmacy
into a strategic asset
Controlling drug costs
Drug Cost Control Service
Drug Cost Control benefits
With a projected year over year increase in drug costs of as much as three percent
across all settings, organizations must find ways to contain pharmacy costs.
Consider the following:
• Due to inaccurate or improperly maintained pharmacy charge masters, hospitals on average
are losing 9–16 percent of their pharmacy charges
• Only 29 percent of hospitals monitor formulary compliance which can lead to inefficiencies
in drug utilization
• By 2020, drug spending is projected to account for 11.1 percent of national health expenditures
This is why hospitals
BIG
saving money
and small
are
by reducing the cost
of medications while
sustaining efficacy
Combat flat margins with this proven program
Drug savings quotient
Cost = Price x Utilization
Phase 1: Quick success, low impact
Phase 2: Long-term, high impact
Reduce drug costs (1-2% savings)
Optimize drug utilization (2-4% savings)
• Lowest price
• Inventory / purchasing
• Optimized automation
• Prescribing benchmark data
• Targeted prescribing programs
• Measurements / scorecarding
Take control of drug costs.
Our deep clinical and cost control expertise can help you identify drug cost savings through
utilization-based data. Cardinal Health does more than identify savings opportunities. Our experts
help you implement and maintain cost savings, providing sustained improvements in:
1 Purchasing
2 Formulary management
3 Forecasting drug expenditures
Our experienced clinical pharmacist
• Analyzes drug purchase and use patterns
• Provides project plan templates, toolkits
and expertise
• Helps you implement drug cost
control initiatives
• Continuously monitors your progress
to ensure sustained savings
Our proprietary, web-based
analytics system
• Identifies top drug cost drivers
• Benchmarks your performance
• Forecasts drug expenditures
Best practices
It takes a team.
Data-driven
Processfocused
Proven
strategies
Cardinal Health has the expertise and the proven processes
to help you reduce drug costs. Of course, each hospital has
unique challenges and a collaborative approach is essential
for success.
Cardinal Health works side-by-side with:
• Pharmacy staff
• Medical staff
• Information systems staff
• Hospital leaders
http://www.cardinal.com/us/en/providers/products/PharmacyManagement/documents/Pharmacy_Management_Brochure_CHPM004_brch.pdf
Savings achieved
93-bed hospital
116-bed hospital
609-bed hospital
77-bed hospital
138-bed hospital
926-bed hospital
95-bed hospital
249-bed hospital
3,326-bed hospital
$108,305
$20,389
$425,557
Small hospitals
< 100-beds
$646,716
$728,647
$800,022
384-bed hospital
$462,464
485-bed hospital
$614,097
Community hospitals
> 100-beds
6 hospitals
$1.8 million
10 hospitals
$2.3 million
13 hospitals
$1.3 million
10 hospitals +
20 other healthrelated businesses
$4.5 million
Health systems
$1,399,230
$592,320
$1,438,562
Large academic
medical centers
Are you trying to reduce your
overall pharmaceutical expenses?
Rising pharmaceutical costs and declining reimbursements are
having a profound effect on profitability. Across the country,
healthcare organizations of every kind — from small rural hospitals to large health systems — are controlling drug costs by
working with the experts at Cardinal Health.
On average, our experts reduce
annual drug spend by up to
three percent.
Are you
already using
generics?
Already
looked at your
purchasing
contracts?
Cardinal Health can help.
Need to take
it to the
next level?
Have limited
resources
to do it?
Don't know
where to
look next?
Cardinal Health works with hospitals and health systems
across the country to help them:
• Add value
• Lower operating costs
• Improve care quality
• Enhance patient satisfaction
Because we believe that...
When a hospital pharmacy is leveraged to its full
potential, it can become a key driver for achieving the
organization's strategic agenda.
The Four F Framework
Find
meaningful
growth
Fix
inefficiencies
Fulfill
quality care
mission
New business
Reimbursement optimization
Government funding
Cost savings
Operational efficiency
Supply chain optimization
Quality care
Clinical outcomes
Continuity of care
Patient safety
Top-line impact, such as
meaningful growth
opportunities, cost savings,
reimbursement capture and
federal funding
Remove operational obstacles
and waste, optimize spend and
apply Lean strategies
Deliver on the vision of
quality care to every patient
through core measures, utilization,
clinical outcomes, physician
alignment, minimize length of stay
and patient satisfaction
Follow
the patient
Population health management
Readmission management
Patient outcomes and
hospital compliance starts at
pre-admission and continues
post-discharge
cardinalhealth.com
Cardinal Health
7000 Cardinal Place
Dublin, Ohio 43017
© 2013 Cardinal Health. All rights reserved. CARDINAL HEALTH, the Cardinal Health LOGO and ESSENTIAL TO CARE are trademarks
or registered trademarks of Cardinal Health. All other marks are property of their respective owners. Lit. No. 1ACP12242 (08/2013)
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