THE JOURNEY OF A MEDICATION
UNDERSTANDING THE SYSTEM. SOLVING THE PROBLEMS.CREATING BETTER OUTCOMES
1. Drug Manufacturer
The Manufacturer develops and produces the medication.
They sell in large quantities.
2. Wholesaler (Middleman)
The Wholesaler buys in bulk and packages the medication in smaller quantities.
They sell to hospitals, pharmacies and doctors' officies.
3. Provider (doctor,pharmacy or infusion center)
The provider buys the medication and gives it to the patient.
They incur costs for:
- Medications
- Nursing time
- Supplies
- Facility & Overhead
4. Payer1/ Insurance Company
The provider bills the insurance company (The Payer)
The payer decides how much they will reimburse.
5. Patient
The patient receives the medication and the care they need.
Better access leads to better health outcomes and better quality of life.
WHERE PROBLEMS CAN HAPPEN
- High drug costs from manufacturer
- Low reimbursement from payer
- Disadvantaged sites of care (infusion centers not in network)
- Complex prior authorizations
- Waste from lack of care coordination
- Contracts that don't cover true costs
SCENARIO: LOSING MONEY
Provider buys medication for
$120
Nursing, supplies, facility & overhead
$30
Total cost to provider
$150
Insurance pays (payer reimburse
ment)
$120
Provider loses money on each treatment
-$30
Over time, this can lead to treatment restrictions, fewer location options, and reduced access for patients.
SCENARIO: Sustainable and Successful
Provider buys medication for
$100
Nursing, supplies, facility & overhead
$30
Total cost to provider
$130
Insurance pays (payer reimburse-
ment)
$150
Provider earns enough to sustain and grow
+$20
Sustainable reimbursement = Better access for patients + Stronger, healthier organizations.
THE RESULT:
Patients get the care they need, closer to home and on time.
Providers can deliver quality care without losing money.
Payers see better value, better health outcomes, and less waste.
Healthcare organizations thrive and grow sustainably.