The Evolution of Best-in-Class Pharmacy Management Techniques

Abstract

The health care industry is becoming increasingly integrated and regional in focus as the market responds to consumer and governmental pressure to continually. reduce the cost of care. In an effort to drive administrative economies of scale, payors and providers-and even distributors and manufacturers-of health care services are consolidating to gain efficiencies, reduce costs, and enhance their access to capital (see Figure 1). The consolidation trend among health plans hasn't been limited to publicly traded, for-profit players. The Blue Cross and Blue Shield (BCBS) system also has shown evidence of substantial consolidation, resulting in a decrease in the total number of BCBS plans from 86 plans in 1985 to the 56 plans licensed in 1998. Nearly a third of these recent mergers were transactions that crossed state boundaries. In addition to efforts to gain administrative efficiencies from consolidation, health plans also are attempting to control medical costs by working more closely with network providers. Most health plans have developed innovative programs to