As the Baby Boom generation continues to age and move through the healthcare system, there are approximately 10,000 people entering Medicare every day1. Additionally, some estimates are that the number of people over 65 will increase by 50% by 2020. However, there is not a linear translation into an increase in the traditional nursing home beds. With patients demanding more options for care, there is an increased focus on treating patients in a variety of non-acute care settings.

Historically, nursing home stays were long-term and often the final care setting for many patients. Not anymore. Today, more stays are short-term as patients have similar clinical needs but more options than generations before. For example, patients might transition from the hospital to long-term care, assisted living, group homes, hospice, or homecare.

This fundamental transformation also extends to the pharmacy. A pharmacy in the LTC industry is no longer just serving the aging population but may also be serving the increased number of patients with chronic diseases requiring more complex therapeutic agents at earlier phases, which may be administered in a number of settings. Some estimates have specialty drugs representing 40% of health plans’ drug spending by 2020, representing increased opportunities for these pharmacies. As patients move in and out of the healthcare system and require a greater variety of therapeutics, there is an increased need for healthcare professionals to follow the patient, ensure smooth transitions between care settings, support medication adherence, improve compliance and reduce avoidable hospital readmissions. The alternate site pharmacy partner can contribute significant value beyond just simply providing the medications requested.

As clinical outcomes become more important — with things like Star ratings, QAPI, value-based reimbursement and adherence metrics moving to the forefront – alternate site pharmacists are becoming increasingly important to successful patient management.   Helping facilities reduce readmissions is likely to quickly become a significant competitive differentiator when LTC facilities and ACO networks are selecting partner pharmacies. As a result, alternate site pharmacists will be more involved in medication management and review and helping facilities increase compliance to reduce readmissions.  


With a greater percentage of care being delivered outside of the hospital, alternate site pharmacies must seek to maximize their share of these adjacent markets. To stay competitive, they must not only improve their bottom line by streamlining operations, reducing expenses and maximizing reimbursement, but also implement technology and provide greater connectivity to be closer to the care that is being delivered.


Responding to this growth and the evolving needs within alternate sites of care, the Long Term Care Division of the National Community Pharmacists Association (NCPA) has been an important resource to help identify the most critical business issues and advocate on behalf of the pharmacies they serve.  McKesson Alternate Site Pharmacy Solutions is proud to sponsor NCPA’s LTC Division and support their efforts by providing educational resources for NCPA members interested in the alternate site pharmacy industry, as well as underwriting the recently published cost-to-dispense study, which showed that LTC pharmacies incur dispensing costs that are 25 percent higher than those of traditional retail pharmacies and provide additional services to meet the unique health needs of LTC residents.  


Yet increased costs aren’t all that these pharmacies face. Relentless downward pressure continues on reimbursement, and patient demands challenge the healthcare industry to provide better care and enable better clinical outcomes. Additionally, alternate site pharmacies need to determine how to meet changing regulations while maintaining continued growth and success.  For example, pharmacies must address the changes resulting from the short cycle mandate that went into effect in January. As a result of its unique partnership with 3rd party repackager Safecor Health, McKesson is helping customers adapt to short cycle mandates and increase efficiency while cutting out costs. Additionally, updates to its ordering platform provides pharmacies with critical information to help them determine which medications must be packaged in 14-day or less increments.   


Supporting quality pharmaceutical care and cost management, the McKesson Alternate Site division is committed to serving the alternate site pharmacy sector by creating sustained value for our pharmacy customers as they seek to provide the best service possible to their customers. Our focus on supporting the LTC, institutional, infusion and specialty markets has led us to offer customized solutions to help pharmacies meet the rapidly changing needs of patients and the LTC industry, including:

  • Specialized packaging options to enable accurate, streamlined, and cost-efficient dispensing and packaging of medications;
  • Six Sigma consulting support to drive efficiency of the pharmacy’s model, cutting costs, maximizing labor and streamlining processes;
  • A more transparent pricing model to help pharmacies evaluate prescription products to add or remove from their formulary, and ultimately drive out costs.
  • Access to subject matter experts in areas of business growth – from home infusion and specialty to 340B.


Across healthcare, the role of pharmacists is evolving to be more integral to successful patient management as patient outcomes become increasingly important.  As the LTC industry strives to reduce avoidable readmissions, it will look to alternate site pharmacists to support patient care and help manage costs. This shift creates the need – and the opportunity – for pharmacies to dem­onstrate to LTC facilities and payers that they maintain a high level of service and efficiently de­liver against adherence and clinical care metrics to improve compliance and reduce avoidable hospital readmissions.

Rich McKeon, MBA, is the vice president of the McKesson Alternate Site Pharmacy Solutions business. For more information, call McKesson at 800-571-2889 or email at