PHAR 173 - Development of Pharmacy Services Exam 2 Study Guide AC

What is a market and what are some characteristics of a market?

-All individuals and organizations that are actual and potential buyersof the service

-Customers from needs evaluation

characteristics: heterogeneous, large

What are the reasons for planning implementations?

- Common Perception

o "It's not approved yet, why put a bunch of work into this?"

- Financial Perspective

o Competition for resources

- Operational Perspective

o Site modification

o Equipment

o TraininG

Chaotic implementations lead to?

Compromised Service

What are the 4 components of an implementation plan?

1. Specific Steps

2. Responsibility

3. Resources

4. Time Frame

Who may need to be trained in order to start a service?

Personnel

o Core

o Support

o Other professions

How do pre-implementation promotions differ from post-implementation promotions?

- Part of Overall Promotional Program

- Focus

o Availability (Location, Date / Time)

o Benefits (Patient, Provide, Competency)

Why would you need to do a pilot and what are the pros and cons of a pilot?

- Need = new service with none similar, same service but significant local differences

- Pros = further development

- Cons = resources, pilot plan development

What are some considerations in determining time until ready to start?

- Time for each step individually

- How long will it take to do it properly?

- Time for critical path

- What is the minimal time to be ready?

- Time availability of personnel

- Service core staff

- Service support staff

- If appropriate, service "customers"

What is a Gantt chart?

method to track progress of implementation

Why should exit planning be done?

- Exit Criteria

- Unsuccessful Implementation

= Assessment (Temporary / Permanent, Partial / Total)

- Changing Market = Assessment (Changing Needs, changing Methods)

What is CQI?

A quality management model where by healthcare is seen as a series of processes and a system leading to an outcome.

What is the CQI/TQM philosophy?

QI strives to make changes in the structural and process components of care to achieve better outcomes.

How are CQI and QA different?

- Added elements of the patient, provider vs."customer"

- Focuses of Measurement

o Medical Errors

o Outcomes of Care

- Technique to improve Quality

o Basing Practice on Evidence

Plan-Do-Check-Act- What is this and how does this relate to a pharmacy service?

What types of measures are appropriate for a pharmacy service?

Indicators

o Two

Process

o Service process that is critical in provision of care

o Not a lab value, a step in the process

Are outcome measures enough CQI? Why or why not?

Outcome

o Patient outcome that is central to the service

o Lab value, Primary outcome if possible

What is strategy? What are some of the levels at which it can occur?

"The purposeful actions of an organization to define and achieve desirable outcomes."

• Long term, "Big Picture"

What are a bottom-up, top-down, and dual strategies?

-Top Down

• The bosses decide, workers go for the ride• Information usually not ideal

-Bottom Up

• Begins at the functional level, difficult to coordinate

-Dual

• Top and bottom independently develop, leadershipreconciles both views.

What is the relationship between strategy and business planning?

-Purpose: To determine what we are trying to accomplish

-Timeframe: S = Long term• B = Short Term

- Outcome• S = Big Picture Directions• B = Operations

-strategic dictates business

-guides business decisions vs consistent with plan

What is the scope of a business plan?

How far out will this service realistically affect others?

What is the rationale behind having a business plan?

Need to make an informed decision before using resources

What are some components of the business plan?

Customer Need

Market Description

Operations

Financial Considerations

What are the steps in determining a business plan?

-Marketing

• 4 P's"

-SWOT Analysis

-What are we good at, what can we improve= Internal

-What trends are favorable for us, what can keep usfrom doing things? = External

-Timeline - When does it need to happen

-Audience

• What stakeholder(s) are we talking to?

What might a planner take into consideration in the business environment?

-Context for Idea

• Framing the idea

-Support of others

• Control resources

-Benefit Framing

• How does it benefit me, them, all of us?

-Financial Impact

• What is the bottom line? For whom?

-Risk

• What am I willing to lose to get X?

-Opportunity Cost

• What you could do with the same resources

-Decision to NOT proceed

•Sometimes, painful as it may be, the best decision

-Trial

• Way to mitigate risk, "prove" rewards

What are some examples of patient needs that can be addressed by pharmacy service?

-disease states

-access to pharmaceuticals

-access to pharmaceutical care

What are the components of a pharmacy service business description?

-need for service is clearly described

-clearly describe service (primary purpose, key components, mission statement - new and previous)

-primary outcomes (clinical, humanistic, economic, perspectives - patient, payer, other stakeholders)

How can pharmacy service concepts be shown to be feasible?

-Existing Pharmacy Literature

0 Same service

0 Similar service

0 Unique service

-Non-pharmacy Literature

0 Nursing

0 Physicians

What is a market and what are some characteristics of a market?

-All individuals and organizations that are actual and potential buyersof the service

-Customers from needs evaluation

characteristics: heterogeneous, large

What is a market segment and how are they used in marketing?

customers who share similar set of needs and/or characteristics (geography, customer, demographics, behavior, combinations)

Who are possible competitors for a pharmacy service? Why?

offering same or similar service, satisfies same or similar needs

What is a SWOT analysis?

-Strengths/Weaknesses

-Pharmacy strengths

-Pharmacy weaknesses

-Opportunities/Threats

-Opportunity - Need that can be satisfied

Why is a market projection important?

-size (segment selection)

-competition (SWOT analysis)

-penetration (ability to reach customers)

-adoption curve

-growth

What are some of the reasons for operations planning?

•Future Success

▫The better the understanding of how the service will run, the greater the probability of success.

▫Often overlooked or poorly done.

Name three key issues in operations planning.

•Processes and Workflow

▫Staff

▫Patient Interface

•Personnel

▫Types

▫Roles

•Non-personnel

▫Facilities

▫Equipment and Supplies

•All must be clearly defined

•Allows for more effective implementation

•Sets the context for economic planning

What should be the initiation point of operations planning?

work process = 1st step towards better idea of service

•Desired Outcome

▫Step by Step

Organized & detailed description

Differ depending on Service

•Patient Interface

▫Initiating Step

▫Cascade

Name three possible processes in a pharmacy service.

▫Patient Processes

▫Physician Processes

▫Institutional Processes

What processes might be planned in addition to the three mentioned above?

•Coordination

▫Key to effective service provision

other processes

•Staff

▫Interactions

▫Tasks and Responsibilities

•Equipment

•Policies and Procedures

•Communication

•Record Keeping

What is the purpose of a job description?

•Title

•Purpose

•Duties

•Qualifications

▫Education

▫Experience

What are some factors that determine staffing levels?

•Determinants

▫Work Process

▫Duties

▫Volume

▫Hours of Operation

•FTE's

▫2080 hours = 1 FTE

•Benefits

Why would a pharmacy service be included in an organizational chart?

-management

-staff

Other than people, what are some other resources commonly needed for a service?

•Facilities

▫Size

▫Arrangement

▫Associated Costs

Fixed

Variable

•Equipment

•Supplies

Law, regulation, standard- What is the difference?

Legislation

▫ State

▫ Federal

• Failure to comply

▫ Fines

▫ Termination of business

▫ Jail

▫ Owners & staff

Name some common pharmacy related laws and regulations and what they regulate.

-State Pharmacy Practice Acts - CPAs

-Staff Safety - OHSA

-Clinical Laboratory Standards - CLIA

-Medicare and Medicaid - Social Security Act - Provider Status

-Federal Controlled Substances Act - DEA

-HIPAA - provider requirements

-OBRA 90 - pharmacy requirements

Name an important mandatory quality standard.

Joint Commission on Accreditation of Healthcare Organization (JCAHO) - required to be eligible for Medicare billing

What pharmacy groups issue pharmacy practice standards?

APhA, ASHP, AMCP

Marketing- What is it? What isn't it?

Marketing is:• a process (on-going; continuous)• based upon a solid foundation of research-customer, competition, external and internal operating environments• integrated• 4 key components - the 4 Ps

What are the 4 P's of marketing?

Product, Price, Place, Promotion

Be able to describe the 4 P's in a pharmacy services context.

-Product

◦ The "What" that is marketed

tangible good, service, idea, person

-Price

Of product

What are customers willing to pay?

-Place (Distribution)

◦ Where does the exchange take place?

◦ Where will the customer go to buy?

◦ How do we deliver the product to the customer? -Promotion

◦ Communicating with the customer

◦ About product, price, place

What can price denote?

what customers are willing to pay

What are the objectives of a marketing plan?

-Acts as a roadmap

-Assist in management control and monitoring the implementation of strategy

- Informs new participants in the plan of their role and function

-To obtain resources for implementation

-To stimulate thinking and make better use of resources

-Assignment of responsibilities, tasks and timing

-Awareness of problems, opportunities and threat

What are the contents of a marketing plan?

-The executive summary

-table of contents• situational analysis and target market

-marketing objectives

-marketing strategies

-marketing tactics

-schedules and budgets

- financial data and control

How can revenue be estimated?

Projected Demand for Service• Unit of Service- Yes, It's confusing• Distinct interactions with patient• Patient/ Unit of service estimations• Vary by patient• Vary by stage of service development

What are some pricing strategies?

Cost vs. Price• Full cost• Variable cost• Marginal cost• Cost / Price Mix• Constant• Varied

What is a payer mix?

-Payer

-Pricing

-Market Share

-Payment types (fee for service, capitated, per diem, DRG, cash)

How are cost avoidance and revenue similar and different?

What is a mixed service?

revenue and cost avoidance mix, mix of fee for service and capitation-type payments, (Revenue per unit X units with revenue) + (Cost Savingsper unit X units with cost savings), excel is your friend

What 2 things are needed (at a macro level) to calculate costs per service?

measures of costs incurred and activity levels

What are some uses for cost of service information?

-cost trending

-price setting

-profitability determination

-evaluate 3rd party reimbursement

-service justification using CBA

-resource efficiency management

-personnel management

What are fixed costs, variable costs, direct costs, indirect costs, operating costs, capital costs?

-fixed costs: don't change when you do more activity

-variable costs: change when you do more activity

-indirect costs: costs that are associated with multiple outputs. Some are fixed, some are variable (rent/mortgage, utilities, insurance, maintenance, computer system)

-direct costs: costs that are completely attributable to one output (educational booklets, testing supplies, data collection forms), usually are variable, time frame implications

What are some indirect costs for pharmacy services?

-A common allocation method indirect expenses is the percentof sales allocation methods.

e.g. Insurance is an indirect expense, so if the MTM service generates 20% of the sales, then allocate 20% of the insurance cost to the prescription department.

-Appropriate for revenue generating services

Is labor a fixed, variable, or some other kind of cost?

indirect cost (labor costs typically are allocated by the percent of time spent on the service)

What are three ways to allocate indirect costs?

-percent of sales allocation methods or percent of square footage methods

-it is more common to use percent of sales method for occupancy costs when calculating the cost of service

What is contained in an income statement and how can it be used?

-Financial planning

-New service projection as well as established -Also known as a Profit and Loss Statement

What is contained in a balance sheet and how can it be used?

-Assets and Liabilities

-Established Services

-Judge impact of changes

What is contained in a cash flow statement and how can it be used?

-Sources & Uses of Cash•

- Short Range Planning

-Can service survive until business grows?

What are some ways of assessing financial performance?

-Break-even point

• Volume?

• Timing?

-Return on Investment (ROI)

• Comparison with other services

• Comparison with other non-service opportunities

Will optimal return on investment always lead to the optimal pharmacoeconomic result?

no?

Pricing decisions• Comparisons with other opportunities• Optimal utilization of each technique• CBA• CEA• CUA

What are the reasons for planning implementations?

Common Perception

o "It's not approved yet, why put a bunch of work into this?"

• Financial Perspective

o Competition for resources

• Operational Perspective

o Site modification

o Equipment

o Training

Chaotic implementations lead to?

compromised service

What are the 4 components of an implementation plan?

-specific steps

-responsibility

-resources

-time frame

What is a critical path and why is it important?

its the schedule for a project w/out float in the plan

what is the minimal time to be ready?

Who may need to be trained in order to start a service?

personnel (core, support, other professions), amount, content, certification, provider

How do pre-implementation promotions differ from post-implementation promotions?

-part of overall promotional program

-focus (availability, location, date/time, benefits, pt, provider, competency)

Why would you need to do a pilot and what are the pros and cons of a pilot?

-Need

o New service with none similar

o Same service but significant local difference

-Pros

oFurther Development• Cons

o Resources

o Pilot Plan Development

Why is assigning responsibility important to a successful implementation?

-Extent

o Whole step

o Tasks within step

-Responsibility/Authority Challenge

o Capable vs. allowed

-Reporting Responsibility

o Managero Project Leader

What are some considerations in determining time until ready to start?

=Time for each step individually

o How long will it take to do it properly?

• Time for critical path

o What is the minimal time to be ready?

• Time availability of personnel

o Service core staff

o Service support staff

o If appropriate, service "customers

What is a Gantt chart?

method to track progress of implementation

Why should exit planning be done?

Exit Criteria

• Unsuccessful Implementation

o Assessment

• Temporary / Permanent

• Partial / Total

• Changing Market

o Assessment

• Changing Needs

• Changing Methods

What is CQI?

A quality management model where by healthcare is seen as a series of processes and a system leading to an outcome.

What is the CQI/TQM philosophy?

QI strives to make changes in the structural and process components of care to achieve better outcomes.

How are CQI and QA different?

- Added elements of the patient, provider vs."customer"

- Focuses of Measurement

o Medical Errors

o Outcomes of Care

- Technique to improve Quality

o Basing Practice on Evidence