PCM & IHCA. Pharmaceutical Cost Containment & Invoicing Solution for Health Centers. Management Companies, Skilled Nursing Homes and LTC Facilities

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1 PCM & IHCA Pharmaceutical Cost Containment & Invoicing Solution for Health Centers Management Companies, Skilled Nursing Homes and LTC Facilities

2 Today s Agenda Who is PCM? The Root of the Problem The PCM Solution & Savings! Summary Now What?

3 PCM is Experienced Pharmacists, Technologists & Entrepreneurs Background in Independent Pharmacies & Tech Businesses Private Corporation since 2015 Based in Ankeny & Clear Lake, Iowa Nationwide Service Footprint (over 66,000 in-network pharmacies)

4 A few of our Customers

5 A few of our valued partnerships with HCAs, GPOs, PBMs & Development Partners

6 Root of the Problem A broken pricing model & reimbursement system No Cost Controls No Transparency Inconsistent Pricing No Time to Analyze Bills Multiple Pharmacy Contracts Multiple Pharmacies Multiple Invoices

7 Root of the Problem Pharmacy Cost Difference Example Prozac (B)/Fluoxetine (G): 20mg CAP30 14 Unique Manufacturers Barr AWP= $ Teva AWP= $ Mylan AWP= $ Multiple Contracts with Facilities: Pharm1 AWP 15% + $2.50 df Pharm2 AWP 15% + $2.50 df Pharm3 AWP 20% + $0.00 ndf Cost to Facility from 3 different pharmacies for Fluoxetine 20mg CAP 30 Pharm1 $ Pharm2 $ Pharm3 $

8 A look at PCM from 10,000 feet A pharmaceutical products & services company focused exclusively on the LTC & SNF Health Centers to partner and provide: Significant and Quantifiable Prescription Cost Savings using Dynamic Real-Time Prescription Market Pricing Consolidated Pass-Thru Invoicing No Out of Pocket upfront Costs UR Analytics & Reporting Utilize existing legacy pharmacy relationships & existing in-network PBM contracts PCM provides pharmacy transparency (Pricing, Consistency, Control & Monitoring) PCM is 100% focused on helping Health Centers reduce costs, reduce risk, and reduce workloads.

9 PCM sits between you and your pharmacy Pharmacy processes claims via PCM; like insurance card The PCM Watch-Dog ensures: PCM Solves the Root Problem by providing an autonomous price Watch-Dog Lowest, consistent pricing to facilities Exclusively Generic Usage Cheapest Generic reimbursement rate to pharmacy Brand and Cost Overrides by Facility Single invoice to Facilities; PCM pays pharmacy

10 Real-Life Example 1: Real Cost Savings PCM Customer XYZ. Multiple mix of rural and city facilities. Average facility size of sample was 70 beds. Average occupancy for sample was 75% with an average of 6 admissions per month for the calendar year. The data used below is a subset of facilities we chose only 10 facilities for this example. Year A with out using PCM: Total Medicare/Skilled Rx = $ 536,240 Year B with PCM: Total Medicare/Skilled Rx = $ 270,472 PCM Total Savings: $ 265,768 PCM saved our customer over 49.6% in total pharmacy costs! Over $250,000 in savings per every 10 facilities, per year!

11 Real-Life Example 2: Real Cost Savings 2 PCM Customer ABC. One rural and three city facilities. Average facility size of sample was 72 beds. Average occupancy for sample was 84% with an average of 8 admissions per month for the calendar year (Max Avg=17; MinAvg=2). Fac1/Mon1 Medicare/Skilled Rx = $ 4,429 PCM = $ 268 Fac2/Mon1 Medicare/Skilled Rx = $ 8,980 PCM = $3,930 Fac3/Mon1 Medicare/Skilled Rx = $ 12,803 PCM = $7,390 Fac4/Mon1 Medicare/Skilled Rx = $ 1,379 PCM = $ 161 PCM Total Savings: $ 15,842 (57.4% Savings)

12 Real-Life Example 3 Brand vs Generic Prilosec o o o Is a generic available? When was it available? What s the cost? PCM will not fill any Brand medication if an FDA approved generic is available; without an override authorization. A PCM client with 24 residents across 9 facilities, over just a 3-month period, overpaid $ for one drug (Prilosec). Rx Cost Cost PCM Savings $ $ $ PCM s Watch Dog will monitor all Brand/Generic prescriptions, all day, everyday to ensure your cost protection. A 73.3% savings with just 3 months!

13 Real-Life Example 4 Additional PCM Savings PCM also reviews non-therapeutic medicines like vaccinations that are not normally a necessity for a skilled inpatient stay. PCM can monitor and require authorization for these types of medications. Some other items that PCM uses to increase cost savings to its customers and users: Item: Zostavax Vaccination Facility Cost: $ per dose. While the cost of this medication was reasonable for the facility, the vaccine normally is not required for a skilled level stay. o o In-house OTC Stock/Supply items Packaging of Medications i.e., Vials vs Pens Again, PCM s Watch Dog will monitor vaccinations and validate their dispensing to ensure your cost protection.

14 Summary Web-based application. No special environment, hardware or software HIPAA Compliant & Secure Integrates and Operates with existing Pharmacies & Programs Eligibility managed in-house or by PCM Services Simple Menu Driven Invoicing and Reporting PCM will invoice you; not all of your pharmacies Invoices by facility, payer and individual residents (Rx & OTC separately) It s a set it and forget it continuous cost savings Watch-Dog system!

15 What s next? Look left Look right. Talk to our current customers, They ll tell you about PCM! Meet with PCM to review facilities and pharmacy providers. Review & Execute our Standard Services Agreement PCM will provide kick-off materials, remote training & full access. PCM can be operational within days. No out of pocket start-up costs. Savings are immediate and begin with your first claim. Special Discounts and Pricing for all IHCA Members.

16 IHCA Member Pricing We Pass every prescription onto you at our cost plus a flat fee to each prescription: Medicare/Skilled (Rx/OTC) $2.35 Medicaid/T-19 (OTC only) $1.35 Unlimited users, facilities, residents & pharmacies Installation, set-up, training & support; included Item Description PCM List Price PCM Facility Fees (1-3) PCM Facility Fees (4-20) Monthly Service Fee per Facility (1-3 facilities) Monthly Service Fee per Facility (4-20 facilities) IHCA Member Discount IHCA Member Price $ % $ % Monthly Subscription Facility Fees Optional Monthly Consulting Available PCM Facility Fees (>20) Monthly Service Fee per Facility (>20 facilities) % $60.00

17 Thank you! Visit our website: See us on social media (Facebook and LinkedIn) Main: Edsar B. Calaguas VP / COO edsar@rxcostmagement.com