Cardinal Health Latest News

Editor’s note: This story originally appeared in Chain Drug Review’s State of the Industry Report, published April 29, 2024.

As pharmacies continue to face numerous challenging dynamics, including continued labor pressures, managing cash flow and balancing their ever-expanding workloads, they are evolving into community healthcare destinations, demonstrating their remarkable value and resiliency.

“In spite of the significant headwinds facing retail pharmacies in the current landscape, they continue to thrive and provide even greater value to their patients through expanded services,” said Brad Cochran, executive vice president of Pharmaceutical and Specialty Distribution at Cardinal Health and president of Medicine Shoppe International, Inc. (MSI). “That’s why at Cardinal Health, we are centered on providing the support, solutions and services pharmacies need as they continue to evolve their business.”

Patients have grown more accustomed to the expanded services many independent pharmacies are now offering. Nearly 60% of Americans are likely to visit a local pharmacy as their first point of contact for treating non-emergency health issues, according to Wolters Kluwer’s Pharmacy Next survey.

“Patients value the personalized care, attention and accessibility offered by their local pharmacy and many now view the pharmacy as their first stop for self-care, illness prevention, chronic disease management and caregiving needs,” Cochran said.

This trend shows no signs of slowing down in the years to come. Recently published data from the National Association of Chain Drug Stores (NACDS) shows more than 80% of patients want to ensure continued access to the vaccination, testing and treatment services they accessed through their local pharmacy during COVID-19. Within the next five years, more than half of patients anticipate visiting pharmacies, retail clinics or pharmacy clinics for the majority of their primary care services, according to Wolters Kluwer.

“As more and more patient care shifts to the pharmacy, demand for clinical services will continue to grow,” Cochran said. “We will continue to invest in our distribution, solutions and service to remain a trusted partner committed to providing the customizable clinical and business solutions pharmacies need to take full advantage of these opportunities.”

MSI’s two national pharmacy brands, The Medicine Shoppe® and Medicap Pharmacy®, offer independent franchise owners the ability to be a part of this transformational moment in pharmacy by offering access to a comprehensive patient care solution portfolio from Cardinal Health.

With Dispill®-USA Multi-dose Packaging, exclusive to Cardinal Health, pharmacies can help drive better medication adherence for chronic disease patients. By grouping doses together in individual blister packs with customizable labels for morning, afternoon and evening doses, Dispill®-USA packaging simplifies medication management to help patients take the right doses at the right time, thereby reducing medication errors and encouraging adherence to their medication regimen. The packaging is also convenient for caregivers to help them keep track of patients on multiple medications. 

Patients are now receiving multiple vaccines at the pharmacy, solidifying pharmacies as convenient, trusted immunization destinations. According to the Centers for Disease Control and Prevention (CDC), pharmacies administered more than 40 million doses of influenza vaccines alone during the 2022-2023 flu season – an increase of more than 1 million doses. By contrast, flu vaccine doses administered in physician offices declined by 3.5 million doses.  

In fall 2023, the newly Food and Drug Administration (FDA)-approved respiratory syncytial virus (RSV) vaccine created even greater opportunity for pharmacies to generate additional revenue through vaccination programs. Franchisees can expand their vaccine offerings with resources and guidance from the Cardinal Health immunization specialized care center. Cardinal Health also is working to expand its vaccine solution portfolio with a comprehensive vaccine and point-of-care-testing service that will offer lower access costs as well as additional marketing and patient education resources.

In addition to building revenue through clinical services opportunities, pharmacies must improve their operations and manage their cash flow to remain financially healthy. With a strong Pharmacy Services Administration Organization (PSAO), inventory management, reimbursement, and other financial tools, MSI and Cardinal Health are committed to empowering retail pharmacy now and into the future.

“We understand the current reimbursement environment pharmacies are facing. As a trusted partner, our industry experts, dedicated account support teams and leaders are working to advocate on behalf of our franchisees and provide the tools and support they need to take their business further, so they can continue serving as the go-to healthcare destination for their communities,” said Cochran.

In order for pharmacies to provide expanded clinical services, they must be able to bill for them appropriately. While some services may be billed under a patient’s pharmacy benefits, others need to be billed under medical benefits, adding additional layers of complexity. Cardinal Health™ Medical Benefit Billing helps pharmacies integrate medical billing into their existing workflow for greater real-time visibility and efficiency for more than 30 different clinical services. The solution identifies all applicable medical claims, including any missing claims for those patients who have secondary insurance coverage. It also automates secondary claim billing and offers real-time claim verification through the Centers for Medicare & Medicaid Services (CMS) to determine patient benefit coverage and deductible balances. A dedicated Cardinal Health team also is available to provide billing support.

Additionally, changes to Medicare Part D billing for 2024 have resulted in cash-flow concerns for many pharmacies. Cardinal Health Pharmacy Services Administration Organizations (PSAOs) LeaderNet, MCC, and MSInterNet, the dedicated Cardinal Health PSAO for franchisees, are leading the way by negotiating directly with PBMs for an extension to the quarterly Direct and Indirect Remuneration (DIR) fees that carried over from 2023 to help pharmacies manage cash flow during this critical period. Beyond advocacy, the Cardinal Health PSAO team shared resources and provided guidance to help pharmacies prepare for and navigate the DIR fee changes that went into effect on January 1, 2024, as well as tools via its Central Pay third-party payment online portal to estimate accruals.

Pharmacy owners are facing an inflection point as they innovate their business model to provide an ever-expanding array of services. Through our comprehensive portfolio of solutions, we are helping pharmacies prepare to face this next phase with confidence.

“With guidance from our team of industry experts and dedicated franchise business consultants, and the operational strength of Cardinal Health, we offer pharmacy owners a supportive team to help them ensure they can seamlessly transition into the future of pharmacy care,” said Cochran.