Pharmacist working on computer at pharmacy drugstore checkout counter
HealthNovember 10, 2021

Vertical integration strategies: Using data to align partners and reduce variation in care

By: Karen Eckert, MPM, RPhGarry Marshall, MBA
“Vertical integration” has become a buzz phrase to encapsulate the healthcare industry’s commercial consolidation and merger mania over the last decade. But simply linking a health plan, PBM, a specialty pharmacy, and a clinic under the same corporate umbrella isn’t true integration. Business leaders are looking for more effective ways to align care and administrative processes among their partner organizations.

Data can be a useful tool for unifying acquired partners who formerly functioned as disparate business entities. If one or more partners are referencing outdated resources to support drug safety, clinical, and formulary decisions, there’s potential for costly and unwarranted variation in healthcare within the vertical and inconsistent, inefficient communication between partner organizations.

Vertical integration in healthcare works best if all partners are aligned using a holistic decision support solution suite with consistent content. It enables you to set three goals to improve outcomes for all member organizations in the vertical:

  1. Reduce variation in care
  2. Enhance access to current evidence-based information and contextual screening
  3. Build a better healthcare experience

Striving for more consistent patient outcomes

From 2017 to 2020, organized market channels have evolved from two, to five, to seven major verticals that incorporate insurers, PBMs, retail pharmacies, specialty pharmacies, long-term care pharmacies, and provider services within a single business affiliation. The concept: with everything from prescribing, to dispensing, to adjudicating claims under one umbrella, economies of scale would be realized, and money would be kept “in house.”

While most market watchers are interested in the long-term financial outcomes of these mergers and acquisitions, vertical integration in healthcare creates potential for consolidation of care quality goals as well.

By nature, a well-constructed vertical should have more control over a patient’s journey, so you should set goals to reduce unwarranted variation in care. The first step is to align all partners onto the same data platform, using consistent clinical content.

With aligned drug vocabularies, clinical recommendations, and even unified drug pricing data, your partners will be more likely to follow consistent best practices, formulary protocols, and established standards of practice.

Situations will inevitably arise where clinicians within the vertical will want to look up more information to research clinical screening results, such as a drug interaction warning. If content is not consistent between screening results and your electronic references, as well as across partners in the vertical, communication (e.g., to confirm a question about a prescription or prior authorization) may reveal different ratings, conflicting recommendations, or missing information between partner organizations. Any confusion will create a breakdown of trust and communication between members of your own vertical, while the additional time spent researching the information will slow down workflow and may jeopardize care.

The same applies to understanding drug pricing. Consistency and reliability of data across your various partners can help streamline therapeutic cost comparisons, cost-effective substitutions, and formulary management without creating disparities or confusion. It can also benefit overall drug pricing analysis.

Your investment in clinical content and data becomes more useful and valuable as you establish and maintain consistency. If partners are called upon to adopt new systems, remind them of the importance of one organization speaking the same language.

Gathering context today for safer and more personalized care tomorrow

With more access to patient information from your various partners, your second goal should be to improve safety and contextual decision making.

As a patient travels through your vertical, you’re going to know more about them than if they were to hop across to other providers and pharmacies that aren’t vertically integrated within your channels. And the more you know about an individual patient, the more you are going to be able to provide personalized care and precision medicine.

In the simplest form, that could mean you know that Patient A is 55 years old, so your system won’t need to fire an alert about medication risks to pediatric patients during any of her contact points with your organizations. In the most complex terms, it could allow for possibilities that aren’t common practice today. For example, if you have Patient A’s genetic testing labs on file, when she goes to the retail pharmacy, the pharmacists can see that she’s a slow metabolizer of a particular medication. They immediately recognize the need to call the prescribing physician back to discuss the possibility of increasing Patient A’s dose.

That kind of precision medicine isn’t happening today. It’s an aspiration for the future of medication safety screening, but one for which vertical integration could help open the door.

Not only would access to greater contextual information increase patient safety, but also, as you move toward more personalized care, you should, in theory, move away from alert fatigue. Without context, a clinical or pharmacy screening system doesn’t know enough about a patient, so it’s going to assume the worst and hit the physician or pharmacist with every alert that could be relevant. That’s why studies have found alert override rates of anywhere from 49-96%.

In your vertical, when all partners are using the same content, finding data points the same way, and capable of sharing contextual clues, you should experience greater precision in medication safety screening and overall better patient safety.

Looking to reduce clinical variation?

Clinical variation drives poor care quality, health inequities, and wasted costs. More than ever, health systems need actionable, efficient solutions to provide more consistent, safe, and cost-effective care.

Explore Solutions To Reduce Clinical Variation
Clinical Variation

Prioritizing health employee satisfaction

Your vertical is serving hundreds of people a day — your employees. With the ability to unite partners on a single solution suite, be sure to select one that offers an exceptional user experience.

Curated content can help alleviate the pain when trying to meet the needs of a variety of healthcare professionals and businesses. Consolidating to one platform saves costs and creates consistency.

Reducing inconsistencies also serves as a valuable timesaver. You do not want unhappy employees diverted from primary business and patient care functions due to issues solving data gaps, normalizing communications with new partners, or managing technical glitches. The best data system is one your employees largely don’t notice. When data is read and communicated consistently and efficiently between partners, processes are smooth, and satisfaction increases.

Bringing together multiple businesses and care teams to function as a unit with a single purpose seems impossible, especially when each partner brings its own legacy. Finding a data solution that considers each partner’s needs can go a long way in better aligning the vertical. Partners can unite and operate under a holistic data strategy with three key goals that focuses all businesses in the vertical on more consistent content and care, a future-focused vision for precision, and dedication to user experience.

Learn how Medi-Span helps health systems, retail pharmacies, PBMs, payers, and healthcare organizations improve the quality of healthcare delivery while decreasing costs.

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Karen Eckert, MPM, RPh
Senior Manager of Commercial Support for Clinical Effectiveness at Wolters Kluwer, Health
Karen Eckert, RPh, is Senior Manager of Commercial Support for Clinical Effectiveness at Wolters Kluwer, Health. She has been with Medi-Span and Wolters Kluwer Health for over 35 years with a focus on developing solutions to meet the clinical business needs of PBMs, EMRs, and pharmacies. She is also a longtime leader at NCPDP, where she currently serves as co-chair of Maintenance and Control.
Garry Marshall, MBA
Senior Director of Business Strategy at Wolters Kluwer, Health
Garry Marshall, MBA, is a Senior Director of Business Strategy at Wolters Kluwer, Health. Garry has a BS in chemistry along with an MBA from the University of Texas at Austin. He has been with Wolters Kluwer, Health for the past six years with a primary focus on leveraging innovation to drive business strategy.
Embedded drug data and clinical screening modules to support appropriate medication prescribing
Organizations use Medi-Span® drug data and clinical screening modules to support appropriate medication decisions, and to help reduce prescribing errors by optimizing alert systems.
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