VOL. 126 | NO. 3 | Wednesday, January 05, 2011
Comprehensive Pharmacy Services Poised for Growth
By Aisling Maki
Thanks to a singular focus on comprehensive pharmacy management, Memphis-based Comprehensive Pharmacy Services is poised to continue growing.
The single largest operation of its kind in the world, CPS has more than 300 client facilities and more than 1,600 professional pharmacy employees in 46 states, Washington, D.C., Puerto Rico and the U.S. Virgin Islands.
The company, which hires about 40 pharmacists each month, is growing by about 35 new clients annually.
“There’s nobody out there like us who’s focused just on pharmacy,” said CPS CEO Don Nickleson. “This is all we do. We don’t have anything else to pay attention to. We’re totally focused on pharmacy management, and that’s allowed us to do some things that our competitors just couldn’t, and it’s allowed us to grow. The fact that we are independent and that this is all we do is the overriding factor to 15 other reasons why we think we’ve grown.”
In 2008, CPS acquired medication management division of McKesson Corp., which added more than 600 pharmacy services professionals and 47 client facilities.
In 2009, CPS acquired a regional call center-based Remote Order Entry company in Illinois, which has been rebranded as Rx RemoteSolutions. The division will provide an offsite medication order verification and processing service.
And just last month, CPS completed the acquisition of Birmingham, Ala.-based Principle Pharmacy Group’s pharmacy management division, the country’s fourth largest with hospital clients in 22 states.
Nickleson said CPS had been looking at the possibility of acquiring PPG for some time.
“They were recognized as the leader in the long-term acute hospitals, a segment we’re really interested in growing,” he said. “They’d done a good job in that segment, and one of the reasons for acquiring them is to get a bigger presence in long-term acute care hospitals.”
Nickleson said there’s huge potential for growth in pharmacy management because only 10 percent of hospitals currently outsource their pharmacy operations.
The company is looking at global expansion and is currently working on a project to expand operations into China.
CPS was acquired by The ServiceMaster Co. in 1996. In 2001, a group of investors that included CPS senior management bought the company back from ServiceMaster.
CPS has four corporate office locations in Memphis, Birmingham, Brooklyn Park, Minn., and Costa Mesa, Calif., where the company’s chief operating officer is based.
The company manages the operations of pharmacies of hospitals from A to Z, providing staff and staff education, purchasing, quality and safety control and compliance and much more.
“Outside of health care, many people don’t realize how important pharmacy is within the health care environment, specifically hospitals,” said Walker Upshaw, CPS chief development officer, who, like Nickleson, is based in Memphis. “From a pharmacy management perspective, we as an organization contract with a hospital client and are responsible for all pharmacy operations within the institution. That involves everything that a pharmacy touches.”
According to CPS, benefits it provides hospital clients include reductions in medical errors; improvements in patient safety; improvements in drug turnaround time; regulatory preparedness; improved financial performance; clinical program development and implementation; and increased satisfaction for nurses and medical staff.
“We help hospitals effectively manage that entire process, from when the order is written all the way to when it’s dispensed and making sure things happen correctly – making sure the right medication gets to the patient at the right time,” said Upshaw. “A very large part of what we do in consultation with the physician is making sure the right medication is being prescribed. It’s the right regimen for the right disease state, it’s most effective, and it’s also the most cost effective.”
With changes to the health care system taking effect, Nickleson said cost effectiveness is a key issue for hospitals.
“The big change in health care right now is all based on quality and cost. Medicare is paying hospitals less if the quality of the hospital is lesser,” he said. “Pay for performance is going to continue to get bigger. What CPS brings to a hospital is the improvement of outcomes so they get the higher payment. We also bring the tools to help them track and measure all that so they can demonstrate it. The health care environment is changing, and so is pharmacy.”
CPS professionals, he said, work closely with physicians to figure out which drug will provide the best possible patient outcome at the lowest cost.
“In pharmacy, if you do the best thing for the patient, it drives the lowest cost,” he said. “It seems counter-intuitive, but they go together. Pharmacy has a lot to do with how long the patient stays in the hospital. The quicker pharmacy can figure out how to get you from an IV to an oral med, you cut a lot of cost and you get to go home sooner.”