5 Critical Steps to Take In Your Store BEFORE 2024

For years independent pharmacy owners have asked for more transparency involving Direct and Indirect Renumeration (DIR) fees so they know if they are actually making money at the point of dispensing a medication.  The Pharmacy Benefit Managers (PBM) have graciously decided to end retroactive DIR fees.  DIR fees will be applied real-time at the Point-of-Sale. This change will give you more insight into the economics of a prescription and patient.  Immediate, Point-of-Sale DIR fees go into effect in 2024 and are likely to create some cashflow pressure on stores during the first half of the year.  In Q1 of 2024, pharmacies will be responsible for paying both Q4 2023 retroactive DIR fees and Q1 2024 DIR fees which will be an adjustment to an already challenging cashflow situation.

Recommendations to Navigate Through the DIR Fees Transition

1. Set up a Perpetual Inventory to make sure that money isn’t sitting on the shelf that should be in the bank or being reinvested into your store. Our sister company, Inventory, IQ is a great resource for this service.
2. Update your store’s business plan and coordinate with your CPA about setting up a line of credit with your bank.  Educate both your accounting team and financial partner about these changes so they aren’t surprised in 2024.
3. Think about and make a plan for large investments and capital expenditures that will be required well in advance. 
4. Maximize purchasing opportunities through your Pharmacy Marketplace membership. 
5. Diversify your pharmacy with service and product offerings including Over the Counter items and non-prescription merchandise that aren’t contingent on PBM reimbursement. 

Legislatively, we are hoping for relief from the growing pressure of prescription reimbursement, but this is truly a “David versus Goliath” battle.  Making the paradigm shift into utilizing technology and operating as a “healthcare destination” as opposed to a prescription dispenser will help you manage the murky waters of community pharmacy.  

Pharmacy Marketplace is your partner that knows what you are going through. Like you, we are pharmacy owners and we understand the drug purchasing model.  We developed a platform that simplifies the many complex formulas that provide the data points needed to make intelligent business decisions for a pharmacy real-time. It is with urgency that we encourage pharmacy owners to join Pharmacy Marketplace and get ahead of the next wave of changes in DIR fees for pharmacies and ensure that you are prepared for next year.  

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