Two-hundred-and-fifty-nine organizations have been named Medicare accountable care organizations. Most were formed by hospitals. Some were launched by physician groups.
And three were created by a pharmacy chain.
Walgreens’ move into shared savings is many things: unusual, eye-catching, a sign of the times.
But it’s not surprising, observers say, as the pharmacy chain has been cultivating a broader strategy to ramp up its role in frontline care. And through a handful of new programs, Walgreens already has “demonstrated … the valuable role our pharmacists can play working with physicians to meet the triple aim” of improving patient outcomes and satisfaction while cutting health costs, spokesperson Jim Cohn told me.
“ACOs are the next step.”
Pharmacists’ Role in Care Provision
Of course, “next step” implies there was a first step, and Walgreens’ path toward frontline health services began in 2006, when the chain launched its first in-store health clinics, staffed by nurse practitioners who treated walk-in patients for the common cold and other ailments. Walgreens now has more than 700 of these clinics.
Walgreens subsequently began redesigning its stores to bring pharmacists out from behind the counter to sit at open desks and offer medication consults. Last year, Walgreens launched WellTransitions, a program designed to reduce hospitals’ readmissions rates by sending medication lists to a patient’s primary care provider, performing medication reviews for partner health systems and delivering other services related to drug therapy.
Meanwhile, the perception of pharmacists has been changing — partly because of Walgreens’ efforts, partly because of underlying changes in health care.
Increasingly, pharmacists are being deployed at the point of care at integrated health systems like Kaiser Permanente, to perform medication therapy management — assessing a patient’s current drugs and interactions — and personalize a medication care plan.
While pharmacists working at a retail chain have a different set of responsibilities, these “pharmacists are perfectly positioned to help address the drug ‘adherence’ problem,” Michelle Andrews wrote for Kaiser Health News/Los Angeles Times in 2011. “Research shows that only about half of people take their medications as prescribed,” which leads to higher costs and complications, Andrews noted. And pharmacists are capable of providing reminders, through their frequent patient interactions.
Mechanics of the New ACOs
But for all of their advancements in supporting care delivery, pharmacists can’t offer diagnoses or actually prescribe medicine. And they are not recognized as providers under current law.
(The National Community Pharmacists Association and the National Association of Chain Drug Stores just this week lobbied federal officials to “expand the role of pharmacists in the various new innovative programs” supported by the Affordable Care Act, including ACOs, and specifically to “gran[t] pharmacists provider status for the purpose of participating in Innovation Center projects.”)
Given these limitations, Walgreens — which was eying opportunities to have a foothold in the ACA’s shared savings program — needed partners to actually launch its ACOs.
The chain will partner with a physician group in New Jersey to create Advocare Walgreens Well Network and a Florida-based clinic to launch the Diagnostic Clinic Walgreens Well Network. The company also has teamed up with a Texas-based health system to launch Scott & White Healthcare Walgreens Well Network.
The new ACOs will draw on Walgreens’ accessibility: Unlike doctors’ offices, the chain’s pharmacies are open every day of the year and some of its locations are around-the-clock. Walgreens locations also can provide basic services “such as transitions of care, medication adherence management, immunizations, [and] health screenings,” Cohn told me.
“Some of the things we’re looking at include information relevant to a patient’s treatment and medical condition,” he added. “That will be stored electronically on a secure platform, allowing health care providers and medical staff more visibility to help create care plans for patients.”
“The way I like to describe it is as a physician-led plan where we’re an active partner,” Walgreens Senior Vice President Jeffrey Kang, who leads the chain’s ACO efforts, told the Washington Post’s Sarah Kliff. “They’re the quarterback who creates the treatment plan. We can be care extenders who help implement and execute the plan.”
Underlying Market Economics
It’s telling that most of Walgreens’ coordinated-care efforts, to this point, haven’t been expected to produce much revenue for the chain. And given the ACA’s restrictions, it’s still unclear how or if pharmacists can be financial participants in ACOs, although Cohn told Pharmacy Today that “Walgreens as a whole will be participating in the savings.”
So why is Walgreens getting into this new market?
There’s some speculation that it wants to move away from traditional retail pharmacy distribution. And the chain had an occasionally difficult 2012. In one troubled period, its haggling with Express Scripts, one of the nation’s largest pharmacy benefit managers, prompted Express Scripts to send its customers to CVS and other Walgreens’ competitors for nine months. One Chicago business writer called the episode the “worst corporate blunder of the year.” However, the firm’s prospects have rebounded; a handful of analysts have touted its stock and, as of press time on Wednesday, Walgreens is trading at an 18-month high.
Regardless, the Affordable Care Act means that there will be new opportunities for the chain to participate in the nation’s health system.
“With nearly 70 percent of the U.S. population either without a primary care physician or not utilizing one, and more than 30 million people gaining insurance coverage in 2014 under health care reform, we are well-positioned to fill the void in care,” Walgreens President and CEO Greg Wasson said at last month’s shareholders meeting.
And Walgreens’ three ACOs may just be the starting point. “We will be looking to expand and form future ACO relationships,” Cohn told me.
Dan Diamond (@ddiamond) is Managing Editor of the Daily Briefing, a CaliforniaHealthline columnist, and a Forbes contributor. This post originally appeared at CalifoniaHealthline.org.
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Walgreens is the most unprofessional of all the chains. They can barely fill a prescription without hurting themselves. And they have the most incompetent pharmacists and inexperienced as well. I wonder what the average age of a Walgreens pharmacist is????
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I am not sure you understand what an ACO is and how it works. You might want to read up on it. Pharmacists will play a vital role in ACO’s.
If you are referring to law suits due related to the health testing. The pharmacists are highly trained to provide the tests and they are not used for diagnostic purposes. Also, you might like to know that as reimbursements for services these have continued to drop, many physicians have referred patients to Walgreens to have their follow-up results completed which are then sent to the physicians office.
What would they get sued for?
Walgreens is in no way trying to move primary care out of the physicians office. They encourage a collaboration among all healthcare providers to increase positive health outcomes. Walgreens is expanding healthcare services to patients who otherwise may not have access to a primary care physician by staffing take care clinics with NP’s and having their pharmacists go through constant training in providing many clinical services.
Think of this, Patient A hasn’t seen a dr in 10 yrs due to lack of health ins, she walks into a Walgreens and sees they are providing cholesterol tests, cost of the test is reasonable, no appointment necessary, can be complete in less than 20 mins, so she decides to have the test done. Discovers her levels are extremely high. Do the pharmacists diagnosis her with high cholesterol, NO. They educate the patient about the levels and risks associated and refer the patient to a physician for follow-up. This simple 20 min test, may have added an additional 10 years to this patients life.
Pharmacists are trained to provide medication therapy to patients, the education they receive when it comes to drugs and they way they react in the body and how they should be prescribed is far beyond that of a physician.
I can’t wait for the law suits to start going to court. I canceled my 12 year business association with Walgreens because they can’t handle the business they have now. Over worked to start with . I stopped my association with Scott and White as well. I don’t like being treated like a number and spied on as to other procedure or other doctors or other drugs I am use for my PERSONAL HEALTH NEEDS. LOTS OF LUCK WITH THIS Marxism APPROACH TO HEALTH CARE.
I think this is a positive step in the right direction. Walgreen’s has a tremendous amount of locations, particularly in areas where some physicians may shy away from opening offices. Their extended hours also will provide more convenience. It’s hard to argue with another well-financed, well-intentioned entrant into the primary care space. But this isn’t a panacea and thankfully Walgreen’s isn’t marketing it as one.
No one would ever suggest leaving your primary physician so long as you have access to one. Despite that, your primary physician does not always have the time to ensure optimum therapeutic regimens, nor does a typical retail/community pharmacist. PharmD’s are trained very clinically towards being able to talk to a patient or read their history, see their current therapies, and make very thorough decisions/recommendations to which are helping, which are hurting, and which additions should be made to best manage a disease state. Further, a PharmD’s ability to educate a patient in an understandable way regarding their medication, disease progression, or overall health maintenance is unmatched. Based on experience, provider or not, I would trust PharmDs to a much greater extent than any other physician extender i.e. RN, PA, NP, etc. Having said that, if the Walgreens business model performs as the pilot stores are intended, there is no limit on the impact PharmDs will have. To be free to practice the way they are trained will save money and lives in the healthcare industry.
As are doctorate of pharmacy (PharmD) degrees. I would rethink grouping nurses and pharmacists into the same category.
Walgreens has definitely seen the future and is iterating rapidly to get there. This will be a series of trials and errors for everyone from pharmacy to PBM to payer to provider.
Finding ways for the pharmacy and pharmacist to play in ACOs is a critical path solution. This is the most used benefit and a localized 24/7 resource that can complement the PCP in most areas of the country.
Walgreens can help with re-admissions as medication reconciliation is a big issue post-discharge.
Walgreens can help with overall care management through immunizations, screenings, and driving adherence.
I’m intrigued to learn more. Their investor day this past week with Boots in the UK was very intriguing as you listen to their global strategy.
A few lawsuits, and all the money they save from this will go down the drain.
I agree with GR, I applaud them for jumping in, but the idea of leaving my primary physician is a bit scary.
But its a start!
I applaud Walgreen’s for seeing a business opportunity and jumping in. But I have never been comfortable with the idea to move care out of a doctor’s office and let nurses and pharmacists take over. MD degrees are more than fancy wallpaper, folks!
I suspect Walgreens has run the population based numbers wrong, just like every other bricks-and-mortar facility that thinks it’s reducing admissions. They only look at the patients they see, not the ones they don’t, and the ones they see are invariably more conscientious. Then the ones they don’t see crash…and then they see them.
I wish them the best of luck but won’t be racing out to buy their stock