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Pharmacy preferred-provider organizations.

American Journal of Hospital Pharmacy

|August 1, 1987

Summary

This summary is machine-generated.

Pharmacy preferred-provider organizations (PPOs) manage costs through formularies and audits. As the industry matures, expect evolving financing and stricter quality standards for these pharmacy networks.

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Area of Science:

Health Services Research
Pharmaceutical Economics
Managed Care Organizations

Background:

Pharmacy preferred-provider organizations (PPOs) are increasingly common in healthcare.
Understanding their structure, sponsorship, and cost-containment strategies is crucial for stakeholders.

Purpose of the Study:

To describe the structure, features, and evolution of pharmacy PPOs.
To analyze different sponsorship models and their implications.
To outline cost-containment mechanisms and future industry trends.

Main Methods:

Descriptive analysis of pharmacy PPO structures and functions.
Review of cost-management strategies employed by pharmacy PPOs.
Discussion of industry evolution and future financing models.

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Main Results:

Pharmacy PPOs can be sponsored by insurers, employers, providers, or independents, with insurer and provider sponsorship being most common.
Cost containment is achieved through formularies, utilization review, and audits.
Pharmacies benefit from increased patronage, protected market share, and improved cash flow.

Conclusions:

Pharmacy PPO financing is evolving towards risk-based contracting.
Increased competition and credentialing will likely lead to enhanced quality-of-care and performance standards.
Choosing a pharmacy PPO requires careful consideration of financial health, claims processing, and long-term goals.