Staying current with wholesaler price updates is an important aspect of your pharmacy business, especially with the current trend of generic drug price inflation. Inaccurate inventory cost can be detrimental to your bottom line if the price you set for a drug or the reimbursement paid by insurance (due to PBM pricing) is less than your cost.To minimize lost revenue you should select and maintain a good relationship with your wholesaler and stay current on wholesaler price updates.
3 Ways to the Most Updated Pharmacy Price
Here are three ways to ensure that you have the most up-to-date pharmacy prices.
Using pharmacy software, there are two ways to stay current on wholesaler price updates through interfacing: EDI and a manual file update.
EDI: Electronic Data Interchange is used in many industries as a standard format to communicate pricing and ordering between manufactures and resellers.
When using EDI your prices will be pulled automatically and imported into your pharmacy software. This information can be viewed on multiple screens in the software and pulled for reporting your pharmacy inventory cost.
This file type is an 832 and it contains the cost of your wholesaler medications and order numbers. Depending on your wholesaler relationship you may receive price updates daily, weekly or monthly.
Manual: You can manually upload price files by going to the wholesaler’s website, logging in, downloading the updates and uploading them to your software. However, because of the ease and popularity of EDI importing only four wholesalers continue to offer this option, and you may have to pay to download updates manually.
Order through Your Pharmacy Software with an EDI Interface
You can compare drug pricing and create an order directly through your pharmacy software with an EDI Interface. When your wholesaler confirms your order an order confirmation alert (EDI 855) will be shown in your pharmacy software. This confirmation will provide details on the inventory you should plan to receive, including the most recent price.
The EDI 855 very similar to the 832, but it comes in response to an order submission and contains the current prices for the drugs that you ordered.
Using the EDI 855 form is a preferred method for staying current on wholesaler price updates. You receive updates each time you receive an order confirmation from your wholesaler, and you get the most recent prices on the drugs that you order.
In many pharmacy software programs, this is the file that is used to determine retail prices and for profitability reports.
AWP Price Updates
Insurance companies commonly reimburse pharmacies based on the average wholesale price (AWP), so it’s important to ensure that you’re keeping tabs on current AWP prices.
Some wholesalers provide AWP price updates in the 832 price update file, but others require you to get these from your pharmacy software vendor. It really depends on your prescription volume, but we recommend checking AWP prices weekly. You have the option to check them more frequently than this, but once a week is sufficient for most pharmacies.
Third party payers don’t always have the most up-to-date AWP prices loaded in their system at the time you bill. This can cause a discrepancy in possible third-party reimbursement and should be carefully monitored.
Both prescription transmission companies, Relay Health and Emdeon, offer services to identify and correct this discrepancy. Your pharmacy software may also have the ability to highlight and help you with this process. To learn how Computer-Rx can help with this please check out Profit Watch Plus in our list of services.
Utilizing one or more of these three sources to stay current with your pharmacy price updates will help you to set the best retail prices for prescriptions. Also, you will have realistic expectations of the reimbursements you will receive from insurance, which will help you better manage the financial aspects of your pharmacy business.
If you would like to learn more about how Computer-Rx can help you stay current, we would love to speak with you today.