One of the newest members of the CUBEX team is Jan Woods, Professional Services and Regulatory Affairs Manager. With increased compliance regulations and inventory management standards, veterinary practices are being challenged to update processes. Jan’s background and expertise allow her to mentor clinics on compliance best practices.
Jan shares her insights and expertise on managing controlled substance costs in veterinary practices.
As a former veterinary practice co-owner, hospital administrator, public speaker and management consultant, I understand the daily expenses associated with controlled substances —ordering, logging, counting and dispensing—are significant, especially when you factor in the complex regulations and overhead costs. In most veterinary practices, it takes approximately 1.5 hours daily to manage controlled substances using manual processes. Automated dispensing systems save time and increase accuracy, but carry a lease or purchase cost that can be an obstacle for some practices.
However, there are three key ways veterinary practices can manage controlled substance expenses and turn them into a profitable portion of business:
- Add a separate ‘controlled substance handling fee’ or ‘narcotics safety fee’ to the controlled substance codes in your PIMS
- Increase your existing dispensing or administration fees for those codes
- Increase the mark-up on controlled substances to account for additional cost
Controlled Substance Dispensing Fees
Given the risks and administration time required to dispense controlled substances, does it make sense to charge the same fees for a narcotic like fentanyl as an antibiotic like Baytril?
Because most controlled substances are not price shopped and are dispensed directly to your patients, it makes good financial sense to consider the dispensing fees you have in place for these drugs. The increased controlled substance dispensing fee should cover your allocated overhead expenses, including your technician’s time associated with ordering, storing, logging, counting, measuring and reporting. If you have an automated system, it should cover the cost of the lease or subscription, typically $15-$35 per day depending on usage.
Your controlled substance dispensing fees can be increased anywhere between $5.00 to $10.00 per script, dependent upon the dispensing volume and manual labor required. Given increasing scrutiny and tightening regulations, proper narcotics safety has required additional investment. This fee increase coincides with investments in electronic dispensing systems. The opiod crisis is complex and requires a community effort, so tangible security measures are reasonable for managing these powerful medications. Increasing your controlled substance dispensing fees correctly allows you to upgrade equipment and better support your staff for improved patient care.
Not sure you’re hitting are the right measurable numbers for increased profits in your clinic? Use our KPI workbook to make sure you’re hitting performance targets:
Controlled Substance Administration
If you do not dispense controlled substances to your patients but rather administer them directly while they are in-house, consider adjusting your injection fees and/or oral medication fees to help balance drug costs and technicians’ time.
Current dispensing fees in a typical veterinary clinic cost between $7.00 and $10.00 per legend drug dispensed. Dispensing fees help decrease your expenses and increase your profit margin. Legend drugs can be competitive though, remember to do your homework and check your competition, such as local and online pharmacies, to avoid pricing yourself out of the market.
Questions about new fees or fee increases are likely to arise. Be honest with your clients: as a result of the opioid crisis, veterinary practices are under increased pressure to ensure they accurately log and report on narcotics. Investing in dispensing systems like CUBEX helps your practice automate those tasks and increase patient safety through securely dispensed controlled substances. It’s important to communicate that better patient care is the goal as you implement new regulations and safety measures.
In the following months we will explore more ways to manage your controlled substances. Subscribe to the blog to get the latest updates and posts. If you have regulatory or practice management questions, send it in and I’ll follow up with you directly.