Pharmacy Pricing Analysis

Revenue Integrity

Hospitals are moving towards standardizing pharmacy pricing across all departments and services, thus improving compliance issues associated with inconsistent charging practices.

Although no standard methodology exists, it is ParaRev’s opinion that when creating pharmacy pricing methodologies, the following must be considered:

•  Self-Administered Drugs (SAD) should have lower markups to comply with Medicare billing standards

•  Pricing should be developed using a nationally recognized cost basis or actual acquisition cost

•  Fixed Add-On and Minimum Charges should be utilized to compensate for any use of additional departmental resources for handling or compounding the medication

The ParaRev Pharmacy Pricing Process assists facilities in creating a rational, cost-based pharmacy markup that remains sensitive to self-administered drugs and uses a nationally recognized cost basis. The project focuses on reducing self-administered drugs while increasing injectable items to meet the revenue goals of the organization.

The ParaRev Pharmacy Pricing Process deliverables include a proposed markup, gross and net revenue projections, an item-specific detailed spreadsheet proposed changes, and a full write-up of techniques and findings.

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