3. Stay on top of price changes
The key to managing price increases is to stay ahead of the game, say Knoer and Rosner.
“We created a dashboard that we review every two weeks,” Rosner says. “We import a catalog and compare the old prices to the new prices, then compare it against the purchases of those products.”
A 1000% increase on a seldom-used drug might not be cause for concern, but a 10% increase on a high-volume product could mean millions of dollars in price increases, Rosner explains, adding the Cleveland Clinic has developed an algorithm to help compute volumes of pricing and utilization data. The results of this analysis is shared with the clinical pharmacy team which then breaks the results into categories and reviews which medications might be removed from the formulary for a period of time and which might be eligible for more cost-effective substitutions.
“What we found is this way we’re not surprised when we have a 100-year-old drug that’s gone up 500%,” Rosner says. “It’s our collaboration with our teams that makes it a very successful process.”
Knoer agrees that the teamwork and planning of the process is incredibly valuable.
“It’s all about vigilance around keeping an eye on prices,” Knoer says. “We are the stewards of the drug budget.”