Health crisis will expand clinic sites, service
When National Association of Chain Drug Stores president and CEO Steve Anderson earlier this year at NACDS Annual urged pharmacy leaders to be “disruptive innovators,” and new NACDS chairman and Walgreens president and CEO Greg Wasson called on the industry to embrace a holistic view of the total store in improving patient lives, they easily could have submitted Walgreens and its Take Care Health Systems subsidiary as an ideal case study.
“When we think about our role in health care we, for years, have been talking about disruptive transformation — positive, disruptive transformation, which is what the healthcare industry has really needed,” Peter Hotz, group VP of Walgreens/Take Care Health Systems, told DSN. “While the worksite and retail businesses are different, they both play that disruptive role. The worksite business is disrupting the way, in a positive fashion, and transforming the way that employers provide access to health care to their employees. … With the retail clinics, the focus there has been transforming access to care.”
Today, Take Care Health Systems is the largest and most comprehensive manager of worksite health-and-wellness centers and retail-based health clinics, with more than 700 locations throughout the country. And there’s no doubt that both its retail-based Take Care Clinics — whose future growth will be influenced, in part, by additional openings of the Walgreens Well Experience concept — and worksite locations are not only revolutionizing the face of health care but also are revolutionizing the entire Walgreens enterprise.
With the convergence of three major trends — a physician shortage, the nation’s deteriorating health status and rise of chronic diseases, and the upcoming increase in healthcare coverage due to healthcare reform — not only will the strain on the nation’s healthcare system intensify, but so will the need for those convenient, affordable and high-quality services provided through Take Care Health. This will further position Walgreens along the front lines of health care.
To counteract the strain on the U.S. healthcare system, Hotz said the company is embarking on several “creative solutions” that will include additional sites, services and hours. Some of these solutions are well under way. For example, Take Care Clinics is offering, in a pilot with the Centers for Medicare and Medicaid Services, the health risk assessment that must be completed as part of Medicare’s new annual wellness visit. It also recently expanded its menu of services to include new diagnostic tests and administrative physicals. The services, which include a blood test used to monitor Type 1 and Type 2 diabetes, and a lab test to help identify hidden blood in the stool, further advance the Well at Walgreens strategy as Walgreens enhances its services as a community healthcare provider and transforms to a health and daily living destination.
Going forward, technology also will play a greater role to help Take Care fill gaps in care. In fact, Hotz said the company currently is testing the application of telemedicine.
For example, Take Care Health Systems collaborated with Cisco in late 2011 to operate the LifeConnections Health Center on Cisco’s campus in San Jose, Calif., offering employees and dependents integrated health-and-wellness services, including primary care, physical therapy, chiropractic care, acupuncture, vision, health coaching and an on-site Walgreens pharmacy. The worksite facility also is connected to Cisco’s campus in North Carolina, where employees can interact with a physician at the San Jose campus via high-definition video.
Hotz also believes there’s an opportunity to offer video health within the retail-based clinics to provide patients access to specialists.
Meanwhile, the clinic operator is piloting a program that offers patients mobile and online appointment scheduling services through consumer healthcare app iTriage, and is offering real-time appointment scheduling via the Web.
“The general, underlying theme is a more integrated part of the healthcare delivery system, and that’s true of Walgreens overall, and not just the retail clinics. Where the clinics started as acute treatment and a lot of independent services, they are now involved a lot more in working with the community as an extension of a health system and working in coordinated models of care,” Hotz said.
Taking a look specifically at worksite clinics, this is a market-driven, fast-growing area of the business for Take Care Health Systems that, generally speaking, is enabling employers to curb rising healthcare costs by saving roughly $2 to $4 for every $1 they invest over a five-year period. In stark contrast to the national average, many of Take Care’s employer clients are showing flat health spending trends over the past five years, Hotz explained — and some are reversing the trend altogether, he told DSN.
“We are being asked to look at the worksite health center as a platform from which we can manage not only the care that is delivered at the worksite, but also in the community. The other big trend there is the continued movement toward more of a population health management role,” Hotz said. “So, not just managing the acute issues, but really looking at that population that that employer is responsible for, and trying to work with that employer on both a macro basis and an employee-by-employee basis to try and figure out how to drive down those costs and improve the health status of that population. We are getting a lot more involved in awareness programs, wellness campaigns, long-term condition management, behavior change … and trying to get at the underlying root causes of the healthcare cost.”
As a strong indication of its belief in the worksite model, Walgreens is one of Take Care’s own corporate clients. Walgreens’ Deerfield, Ill., office campus hosts a Healthy Living Center that offers headquarters team members a full array of acute and preventive services and an impressive fitness facility.
Pharma strategy moves past product to patient
Walgreens is fundamentally changing the way it does business with both its upstream pharmaceutical suppliers and its downstream customers in the managed care world. The goal: to help its partners on both ends knock down decision-making silos and create more strategic and profitable relationships that lead to lower costs, higher profits and most importantly, healthier patients.
“You can focus on the drug spend — which is 8% to 10% of the total healthcare spend in the United States — all you want. But the real Holy Grail is working with all of these partners on lowering overall medical costs and creating a better health outcome by leveraging all our assets in a completely different way,” said Jeff Berkowitz, SVP pharmaceutical development and market access.
Berkowitz leads the overall pharmacy contracting strategy for the company, both on the purchasing side with branded and generic pharmaceutical manufacturers, and on the retail payer side.
That puts Berkowitz in charge of both the drug procurement teams — which together purchase products that generate nearly $40 billion a year in pharmaceutical sales — and the sales, contracts and pricing, and marketing people who market Walgreens’ portfolio of pharmacy and health services to health plans, pharmacy benefit managers, hospitals, employers and other health stakeholders. It’s a more coordinated, even transformational approach to what he calls “the managed markets world” of health care.
Berkowitz came well-suited to the role. A lawyer and pharmaceutical industry veteran, he was SVP global access for Merck before joining Walgreens in September 2010 where he served on the global health and emerging markets leadership teams.
“The reason Walgreens wanted somebody with large Pharma experience,” Berkowitz explained, “is that we interacted with a big group of stakeholders and needed to find new ways to collaborate to remain relevant in an ever evolving industry.”
That included physicians, employers and other health plan payers, managed care organizations, and the branded and generic pharmaceutical companies from which Walgreens purchases tens of billions of dollars worth of medicines each year. “We really needed to better establish relationships [based on] our value proposition as a retail pharmacy and healthcare provider … to explore ways we could work together with pharma companies, even from a savings perspective, he said. So it’s much more now than just a tactical purchasing relationship.”
Walgreens completely transformed the relationship it has with pharmaceutical companies, Berkowitz added, by focusing on the value it could bring to those suppliers and “how they could leverage our footprint for … everything from compliance, adherence and educational programs around specific products … to the provision of clinical trials.”
“Walgreens has become an integral part of a pharmaceutical company’s strategy across their portfolio. It’s not about any one particular product, but a collective focus on the patient,” he said.
Under Berkowitz, Walgreens also has transformed the way it markets and explains the business to insurers, pharmacy benefit managers and health plan payers. Prior to that change, Berkowitz explained, the sales organization was focused on signing up small employers, for instance, to provide flu shots for their employees. “Today, we now have account managers creating partnerships with some of the largest insurers in the country who provide health benefits to tens of millions of people in the United States.”
Walgreens is well on its way to creating “fully integrated strategies” with the top decision-makers at health plan giants, employers and hospital systems, Berkowitz explained.
“It’s about how we solidify our role within the healthcare ecosystem,” he noted. “It’s critical for us to have deep relationships with the leading healthcare providers in the country.”
Reinventing community pharmacy
A vast army of some 70,000 Walgreens pharmacists, technicians, nurses and nurse practitioners, and other clinicians is poised to plug some of the gaps in the nation’s overstretched healthcare system with expanded services, greater access for patients and new solutions for providers and payers in desperate need of quality, cost-effective solutions.
“For us, the product is no longer the pill. The product is the health outcome associated with that pill,” said Kermit Crawford, president of pharmacy, health and wellness. “We are deliberately transforming the way we practice pharmacy, going from what was a transaction-based environment to one that is more about patient relationships. So, for example, we’re moving our pharmacists from behind the counter out to where … they’re able to talk with our patients. And we’re enhancing those conversations through the use of technology.”
That transformation in pharmacy extends across Walgreens’ traditional retail prescription business, as well as its Take Care retail clinics and Employer Solutions Group, and its specialty pharmacy and home infusion businesses — all of which report into Crawford.
Crawford says Walgreens is on a quest to enable its clinicians to “practice at the top of their license.” And among the steps the company has taken “to transform the way our healthcare professionals operate today,” said the company’s top pharmacy and health decision-maker, are retail health services like patient adherence programs, a growing menu of health tests and collaborative disease management efforts with hospitals and physicians.
Not to be overlooked is the company’s vast immunization capability. Walgreens is the nation’s leading flu shot provider after the U.S. government. Its pharmacists and Take Care Clinic nurse practitioners and physician assistants administered 6.4 million flu vaccinations in 2011, nearly a third of them on nights, weekends and holidays. “No other provider can offer that convenient access,” Crawford asserted.
The massive vaccination program underscores Walgreens’ national reach and its claim as the nation’s most accessible and convenient provider of pharmacy, health and wellness services, with roughly 8,000 retail, clinic, hospital, employer and specialty pharmacies spread like a blanket across all 50 states. “We’re within three miles of two-thirds of the U.S. population,” Crawford said.
What’s more, he added, “About 40% of our stores are located in medically underserved areas. And giving people convenient access to quality, affordable care improves the patient experience and … helps lower overall health costs.”
On the clinic side, “We’re evolving to a chronic-care model,” said Crawford, expanding the role of the nurse practitioners that staff its 350-plus Take Care Clinics beyond episodic care. And to be sure, it will be building a lot more clinics in the years to come.
“As we continue opening more Well Experience stores, that provides more opportunity to expand our Take Care Clinics,” he added.
The need is clear. “Fifty percent of the people who visit our clinics don’t have a primary care physician. And with so many of our stores in medically underserved areas, there’s a real opportunity to grow our clinics,” Crawford noted.
Like its more than 27,000 pharmacists, the Take Care nurse practitioners are increasingly positioned as a vital adjunct to the care provided by the nation’s shrinking and overtaxed pool of primary care physicians. “In our clinics,” he noted, “we’re working collaboratively with a physician to manage a patient’s disease state. That care doesn’t have to be done in a physician’s office.”
“Walgreens can connect the dots in American health care,” Crawford added. “With health reform and rising health costs, we have a real opportunity here. The goal is to leverage our assets, our footprint of over 8,000 points of care, our presence in the community, our hospital and employer- based pharmacies and health centers and our clinics … to help manage total population health.”
Clearly, one area in which payers need help managing costs is in specialty pharmacy, where Walgreens is able to leverage and bundle its many assets and channels to deliver multiple options for patients and payers to choose the mode of care that works best for them.
One prime example of how Walgreens is able to accomplish this in specialty is through a program it calls “Well Transitioned,” which utilizes pharmacists in its more than 100 pharmacies based in hospitals and specialty clinics across the country, to provide pre- and post-discharge medication reconciliation for patients on complex specialty medications, such as organ transplant patients. “We call it the ‘front door’ of specialty pharmacy,” Crawford told DSN.
“So, before a patient is being discharged, [our pharmacist] will go visit the patient in their hospital room and educate them about the new medications their physician is putting them on. And then once they leave, we’ll call them at home to talk to them about the medications they’re taking, how to take them, what to expect in terms of side effects, what they’re used for, what they look like and then later, how do they [get] these medications,” he explained. “So, if they live outside of the trade area of that on-site pharmacy, how they connect to other Walgreens services” to keep them compliant on their therapy regimen.
It’s an important example of how Walgreens provides new solutions for payers and patients that help trim the upstream costs of poor compliance and adherence. While much focus is given to the 12 cents on the healthcare dollar that goes to pay for prescription drug costs, not enough is focused on the other 88 cents. For instance, as many as 30% of all hospital readmissions are due to poor medication reconciliation, Crawford said.
To keep discharged patients compliant with therapy, Walgreens is able to provide a number of options for how they can get their medications. If the patient lives near the on-site hospital/clinic pharmacy, they can come back there to get their medications, or they can choose to have it shipped to their homes via a Walgreens central fill facility or shipped to their local Walgreens store through its Specialty at Retail program. “Our model is to allow patients to choose what is the best experience for them, but then we support that through all of our different assets and channels,” Crawford said. “We believe better patient experiences drive better patient outcomes, and that drives lower costs.”
The chief engine driving Walgreens’ revenues — which topped $72 billion last year — will continue to be its prescription dispensing business, which last year churned out 819 million scripts, or 1-in-5 U.S. retail prescriptions. What is changing is the way those medicines are dispensed as the company takes a broader view of the continuum of care, automates more of the dispensing process and shifts more of its pharmacists’ attention to direct patient engagement.
“We’re still filling scripts; we’re just more efficient in how we do it,” said Crawford. “We looked at all the administrative tasks associated with filling prescriptions, and some we have moved centrally.”
In addition, the company has added automation, “About 40% of our qualified prescriptions today are filled through e-prescribing, which is … taking work out of the dispensing.”
Walgreens’ massive flu shot and immunization program has been key to its effort to transform to a full-spectrum retail pharmacy, health and wellness powerhouse. Launched at the suggestion of a Walgreens pharmacist in Colorado — “the majority of our ideas come from the field,” said Crawford — the flu shot effort began to open patients’ eyes to the types of health, wellness and disease prevention services that Walgreens pharmacists could provide.
“Five years ago, we had about 300 pharmacists certified to do flu shots,” said Crawford. “This past year, virtually all 27,000 of our pharmacists were trained [as] certified immunizers beyond flu shots. Today, all our stores are certified to give any of the 20-plus CDC-approved immunizations that are approved in their state.”
Immunizations became the gateway for a shift in the company’s health mission and business strategy. “We demonstrated that pharmacists interacting with patients by giving them flu shots led to great conversations,” Crawford told DSN. “It was loud and clear that it was acceptable.”
What’s more, he said, “flu shots were the beginning of patients looking at our pharmacists differently — giving our pharmacists permission to play a greater role on the healthcare team.”
One reason: Walgreens pharmacists were talking with patients “not only about flu shots, but about the disease states that required them to get a flu shot,” said Crawford. “It really enhanced that face-to-face interaction.”
In September, Walgreens will further strengthen that relationship with the launch of its first customer loyalty program. One key aspect of its new Balance Rewards program is that it rewards card holders for healthier behavior, for instance, accruing points for participating in programs like Walk with Walgreens. Among other benefits like building store-purchase baskets and return customer visits, said Crawford, the program provides another entry point into Walgreens’ pharmacy, health and wellness offerings. “This is a way for us to reward people for adhering to their medication therapy, or participating in [preventive health] programs,” said Crawford. “We can tie it into the overall goal of helping people to live well.
“We’ve actually begun to change the way health care is delivered in this country,” Crawford asserted. “With health reform, another 30 million people will get access to care, and there’s already a shortage of primary care physicians.”
“Someone’s going to have to fill that space, and we think Walgreens and our professional clinicians are uniquely positioned to do it,” he said.