Optimizing Hospital Revenue with Infusion Centers and Specialty Pharmacies

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Optimizing Hospital Revenue with Infusion Centers and Specialty Pharmacies

Hospitals and health systems are facing unprecedented revenue challenges as the COVID-19 pandemic endures. Losses were estimated at $323B in 2020[1] and could exceed $54B in 2021[2]. According to AHA President and CEO, Rick Pollack, we are “in the midst of the greatest financial crisis in our history.” The pandemic upheaval only compounds growing trends that have hamstrung financial success for several years, such as increasing drug costs, new payor mandates, and diminishing reimbursements for specialty treatments. To overcome these challenges and establish long-term success, hospitals must identify areas of opportunity that expand revenue.

With decades of experience and deep expertise, CPS® guides hospitals and health systems through these challenges, driving revenue rapidly. We establish trusted partnerships with our clients, identifying and executing innovative solutions that set the stage for long-term financial success. Our partnerships focus on two key areas that face significant challenges, but also offer substantial opportunities: infusion centers and specialty pharmacies.


Infusion Centers


While outpatient infusion centers have historically been profitable service areas for hospitals and health systems, they are facing new challenges sustaining revenue. In the past few years, payors have begun to scrutinize higher costs at hospital-based infusion centers, directing patients towards commercial specialty pharmacies, physician infusion centers and/or home infusion. Payors have also shifted the coverage of certain infusion drugs from the medical benefit to the pharmacy benefit, making a significant change to the benefit structure and reimbursements.

This payor driven restriction, known as “white bagging,” limits infusion drug reimbursements to select preferred specialty pharmacies. Site of Care initiatives began with only a couple of drugs – notably Remicade and IVIG products. As payors recognized significant cost savings, dozens of other infusion drugs were added to this list. Now a seven-page list of restricted infusion drugs are reimbursable as a pharmacy benefit, making it more challenging for hospitals to obtain payment.

White bagging can burden hospital infusion centers, as they must obtain the infusion drugs from the preferred specialty pharmacy or obtain preferred classification for their in-house specialty pharmacy. In this scenario, hospitals face sustained difficulties procuring and storing infusion drugs, coordinating administration, and obtaining reimbursement for the infusion drug.

This highlights an everchanging ecosystem for infusion services that hospitals are struggling to maneuver in real-time, resulting in dwindling patient retention rates and dangerous revenue losses. In this dynamic landscape, hospitals and health systems need a knowledgeable and experienced partner like CPS to successfully guide them through these changes.


CPS' experts leverage decades of experience to design customized strategies that drive revenue to hospital infusion centers. Staff perform feasibility assessments to identify potential savings and new revenue opportunities. We drill down into the data to see where patients dropped off, received care from another facility, or revenue cycle inefficiencies. We work with the health system to build a strategic roadmap creating a site of care within the hospital system for these infusions patients and improve patient access and retention.


Specialty Pharmacy


The specialty pharmacy space offers another potential revenue stream for hospitals and health systems. It is becoming increasingly critical for hospitals to develop in-house specialty pharmacies to sustain revenue in the face of evolving care models. Relying on external specialty pharmacies may jeopardize access to specialty drugs with limited distribution, interrupt a seamless continuum of care, and abandon potential revenue.


Pharmaceutical costs are the fastest growing portion of healthcare spending, and specialty drugs are an increasing portion of overall pharmaceutical spending. According to a 2017 Drug Channel Institute report[3], specialty drugs comprised just 17% of overall prescription spending in 2011; in 2021 it is estimated to comprise as much as 42%. Specialty pharmacies are cropping up at an exponential rate to support this demand, and yet only a small percentage of hospitals maintain their own specialty pharmacies.  

By establishing an in-house specialty pharmacy, hospitals can benefit from reduced drug acquisition costs and access to payor reimbursement under the pharmacy benefit. The benefits go beyond the financial, as hospital owned specialty pharmacies enable a consolidated continuum of care for patients. This means more rapid therapy initiation, better oversight of medication adherence, improved management of side effects, and enhanced patient outcomes overall.


CPS' team of experts help you build and staff your own best-in-class specialty pharmacy, serving as a pillar in the community. Our team starts the partnership with a financial forecast, identifying a plan to escalate growth quickly. We support the design, build, and implementation of your specialty pharmacy so you can go to market swiftly and successfully. We offer clinical management, facilitate access to sought-out payor networks, and streamline operations with end-to-end pharmacy management systems. Most critically, we support dual accreditation in nine months or less with bodies such as URAC, ACHC, CPPA, and Joint Commission, differentiating the specialty pharmacy in the marketplace and driving revenue.


Successful hospital infusion centers and specialty pharmacies have the immediate impact of retaining patients within the system. Since hospitals are the best equipped to manage patients with complex chronic diseases, retention not only improves revenue, it also enhances the continuum of care for patients. Hospitals are able to streamline data, therapies, medication information, and overall care for specialty patients, serving as a single point for all of their healthcare needs.


CPS' solutions offer hospitals and health systems an immediate means to confront the substantial financial challenges at hand and pave the way for sustainable revenue. We are proud to serve as a trusted, knowledgeable, and experienced partner, empowering long-term financial and operational success. Our mission is to support everything from A to Z In your Approach, so that you can sustain your own best-in-class operations with financial and operational success.




[1] https://www.healthleadersmedia.com/finance/aha-hospital-losses-could-top-323b-2020

[2] https://www.beckershospitalreview.com/finance/covid-19-will-push-hospital-losses-to-54b-this-year-report-estimates.html

[3] Report as quotes in this article: https://whitecaphealth.com/insight/specialty-pharmacy-why-your-organization-cant-afford-to-sit-on-the-sidelines/

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