Hospitals are finding that specialty outpatient pharmacies can improve quality of care and patient safety and bring in additional revenue. The process can require significant resources, but the benefits may include a greater return on value-based contracts.

A specialty pharmacy is a rare opportunity to improve quality of care while also increasing revenue for the hospital, says Amy Andersen, healthcare industry lead with North Highland Worldwide Consulting in San Francisco. She and her company have worked with Vanderbilt University Medical Center on various healthcare quality improvement efforts. Recently, the university inquired about how to improve patient access to specialty drugs that typically are extremely expensive. For example, a 12-week course of therapy for the hepatitis C drug Harvoni carries a wholesale price of approximately $95,000. Symdeko, used to treat cystic fibrosis, costs approximately $290,000 annually.

Vanderbilt is eligible for the 340B federal drug pricing program, which means it could staff a specialty pharmacy for outpatients who need these high-cost drugs, Andersen explains. “It was hundreds of millions of dollars in additional revenue that they were able to bring into the organization. More importantly, it closed the care continuum by connecting the pharmacy to the clinics serving these patients,” Andersen reports.

“It created an ecosystem for supporting patients and allowed for the onsite medical education, consultation with both the pharmacist and clinician, and integration between all the clinicians and pharmacy staff. When patients go back to their homes, they are supported in adherence, which, of course, improves quality of care and outcomes.”

Vanderbilt also discovered that the integrated care model better allowed clinicians to understand and support patients seeking preauthorization and trying to understand their copayments, Andersen says. Clinicians also gained a better understanding of social determinants of health.

“These eligible hospitals are serving populations that are quite vulnerable. They have a strong mission to serve their communities, which can be challenging in a financial sense,” Andersen says, noting that by providing a specialty pharmacy service, these revenue streams that otherwise would go to CVS and Walgreens are now coming into the hospital. “There are opportunities there when you engage the business side and clinical side of the organization to look at the revenue coming in and decide how to use those resources to fulfill your mission.” However, implementing a specialty pharmacy can be challenging for any organization.

A large academic medical center like Vanderbilt has resources that smaller hospitals lack, including the existing pharmacy operation and infrastructure needed to support the new outpatient specialty pharmacy, Andersen notes.

“The biggest challenge for an organization setting up a specialty pharmacy is on the operations side. From a sustainability standpoint, they must have the resources and the market with their patients to do more than break even and reap the rewards from a revenue standpoint but also from a patient safety and quality standpoint,” Andersen says. “They will want to assess to what extent they have risk contracts in which payments are based on patient satisfaction and outcomes measures. This can be a piece of the puzzle for organizations moving more into the value-based care model.”


  • Amy Andersen, Healthcare Industry Lead, North Highland Worldwide Consulting, San Francisco. Phone: (415) 624-6572. Email: