3 Tools to Help You Offset Pharmacy DIR Fees

3 Tools to Help You Offset Pharmacy DIR Fees


Prescription drugs make up more than 90% of pharmacy sales and over half of all prescriptions sold in the US are covered by Medicare Part D and Medicaid plans.

Pharmacy’s revenue depends heavily on prescription sales and the profit margins from health plan reimbursements. But unexpected expenses like Direct and Indirect Remuneration (DIR) fees can cut into those profit margins, presenting a serious business challenge.

How DIR Fees and Reimbursement Rates Affect Pharmacies

According to the NCPA, DIR fees have presented a challenge to independent community pharmacies for some time. During the first outbreak of COVID-19 early last year, over 75% said they were a source of financial strain. Another NCPA report found that pharmacies have had to pay over $8.5 billion in fees to Pharmacy Benefit Managers (PBM) and health plans since 2013.

Originally intended to account for the true medication costs of Medicare Part D plans, DIR fees now represent a rapidly growing range of fees charged to pharmacies after the point of sale.

These can range from performance-based fines and network membership costs to reimbursement deductions, such as:

DIR fees are assessed during and up to 9 months after adjudication by health plans to help reconcile their medication costs for reports, making it difficult for pharmacies to predict when and how they’ll be affected.

Increasing Pharmacy Profits With Digital

DIR fees essentially cut into pharmacy reimbursements rates, limiting revenue and diminishing profit margins in the face of rising drug costs. Pharmacies can counter or offset these fees by focusing on increasing their profit margins.

A few ways to boost pharmacy profitability:

  • Reducing labor expenses by automating routine tasks
  • Promoting and maintaining patients’ adherence and PDC scores
  • Increasing patient prescription base
  • Offering non-prescription pharmacy and specialty products or services

Today, digital tools drive innovation in business. Healthcare industry solutions like telehealth, digital refills, and mobile health apps help consumers manage their health and connect with healthcare providers on multiple platforms.

Your pharmacy can leverage digital tools to increase efficiency, reduce overhead costs, and increase profitability. Digital solutions help automate tasks, streamline workflows, and promote adherence. They also position pharmacies to appeal to and reach a broader audience, both on and offline.

3 Digital Tools That Increase Profits and Offset DIR Fees

There are a myriad of management, communication, and engagement tools available on the market today. Your pharmacy’s digital toolkit should contain solutions that help you automate operations and serve patients well, with solutions such as:

  • Direct Secure Messaging. Designed to drive patient engagement and retention, this platform connects pharmacists and patients through HIPAA-compliant direct messaging. Your pharmacy can initiate conversations, send targeted or bulk messages, and exchange multimedia and private information safely, streamlining outreach and offering patients a convenient on-the-go touchpoint.
  • Interactive Voice Response (IVR). IVR systems support pharmacists by managing and directing inbound calls. Using cloud-based technology and features such as visual voicemail, after-hours settings, and auto attendants, the system routes queries, saves messages, and processes refill requests. They also save your staff time by giving you the tools to pre-record important pharmacy information, reducing call pickups.
  • Branded Healthsite and Mobile App. These often integrated tools act as digital business cards on multiple devices, giving your patients the ability to find and use your online services. Pharmacy healthsites and mobile apps provide a HIPAA-compliant platform for you to do business outside the store and in many cases, increase patient adherence through self-service and management capabilities.

At Digital Pharmacist, we offer a comprehensive HIPAA-compliant digital engagement suite to help transform the way pharmacies do business. Our all-in-one solution combines cloud-based communication and adherence solutions with digital and mobile marketing and reputation management.

To learn more about how our digital tools help improve your pharmacy’s profitability, get in touch with us, or request your free software demo.



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