In early 2020, as health systems across the U.S. were dealing with the COVID-19 pandemic, Danville, Pa.-based Geisinger’s leadership team was also rethinking the structure of its ambulatory pharmacy operations and distribution channels.
The result was the formation of Geisinger Pharmacy LLC, which has since become the vehicle for the health system’s operational agility and strategic innovation.
“It really becomes its own line on the system financials,” Gerard Greskovic, Geisinger’s vice president of ambulatory pharmacy, told Becker’s. “And the benefits of this added visibility into the value of pharmacy to the organization is immense.”
Why an LLC?
The idea came to the health system as the pharmacy team worked with its strategic partners to map out a five- to 10-year plan. As part of that process, pharmacy leaders learned the system needed a new structure to help manage the complexity and potential of Geisinger’s growing ambulatory pharmacy network.
Mr. Greskovic cited three primary reasons for the shift: tax planning, financial visibility and operational flexibility.
The traditional setup, he emphasized, can impact pharmacy’s ability to act quickly in response to market shifts, whether they involve payer shifts, regulatory changes or retail instability.
“One minute there are three pharmacies serving a community, then two months later there are none. As a result, health systems like Geisinger need to have the ability to quickly implement programs to support the community and provide access to medications ,” he said.
He added that creating a separate legal entity with its own board has allowed the pharmacy to move faster, while still supporting the health system’s broader goals.
What the LLC entails
Geisinger Pharmacy LLC includes four main pillars, Mr. Greskovic said: 14 retail pharmacies, a mail-order pharmacy, a dual-accredited specialty pharmacy and three home infusion pharmacies.
Beyond dispensing prescriptions, the LLC is supported by a clinical services arm with close to 100 embedded pharmacists who work directly in provider clinics, helping with medication selection, disease management, prior authorizations and care coordination.
Supporting them is also a centralized team of virtual pharmacists, techs and medication access coordinators who are focused on streamlining access and affordability, Mr. Greskovic said.
Benefits to the LLC model
One unanticipated advantage of the LLC model, Mr. Greskovic said, is the ability to provide more tailored, direct contracting — especially in areas such as home infusion, which typically get bundled with broader system contracts.
“A lot of times when you try to merge everything together, there is a potential for something to get overlooked or compromises made,” he said. “By pulling it out, it just gives you the opportunity to scrutinize the details a bit more and negotiate more appropriate reimbursement rates.”
The LLC has also fostered improved collaboration and cross-training, Mr. Greskovic said. When COVID-19 disrupted operations, the structure allowed Geisinger to quickly reallocate pharmacy staff across departments, an example being how it moved personnel from underused retail locations or clinical practices to the busier mail-order facility.
“Instead of having a team of let’s say 100 people, now I have a team of 500,” he said. “It allowed me to do a lot of cross training and shared staffing.”
What does the future of the LLC look like?
As Geisinger Pharmacy LLC looks ahead, retail pharmacy is an area of focus and uncertainty, Mr. Greskovic said.
“We have to figure out, what does retail pharmacy look like in the future?” he said. “It can’t be a pharmacy on every main street, as we are seeing that model is not viable in today’s market.”
Due to this uncertainty, he envisions growth in automation, delivery logistics and AI tools that can help support prior authorizations, enhance patient access and promote faster prescription processing in a more efficient and cost-effective model.
Mr. Greskovic also emphasized that the LLC’s overall structure positions the health system well for what is ahead in keeping up with shifting patient expectations and demonstrating the value pharmacy brings to integrated healthcare.
“By reporting out separately in this LLC, it really did give us that opportunity,” he said.
