Stay On Target® and GroceryRx: Educating and Incentivizing Patients to Achieve Positive Health...
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Transcript of Stay On Target® and GroceryRx: Educating and Incentivizing Patients to Achieve Positive Health...
Target Case Study:
Stay on Target™ + groceryRx™
Richard CarunchoAustin HewlettKeith KincaidAmit Ranchhod
1
Agenda1.0 Background
2.0 Proposed Concept - Stay on Target™ + groceryRx™
3.0 Business Case and ROI
4.0 Closing
2
BackgroundSection 1.0
3
Market Share within Retail Pharmacy
4Section 1.0 - Background
Company
2010Share of
Prescription Revenues
2011Share of
Prescription Revenues
Net Change
CVS 20.1% 20.7% 0.6
Walgreen Company 16.2% 16.5% 0.3
Wal-Mart Stores, Inc. 6.2% 6.4% 0.2
Target Corporation 1.1% 1.1% 0.0
Other Chains 14.2% 11.0% -3.2
Source: The 2010-11 Economic Report on Retail and Specialty Pharmacies
Target’s key competitors are already utilizing their expanded reach into healthcare by moving beyond traditional offerings.
5Section 1.0 - Background
Walgreens Publix Wal-Mart
Pharmacy Chat Free Medications Specialty Pharmacies
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groceryRx™
↑Grocery Sales
↑All-Store Sales
↑Market Share
Stay on Target™ ↑Medicatio
n Compliance ↑All-Store
Sales
Section 1.0 - Background
Proposed Concept groceryRx™ +
Stay on Target™ Section 2.0
7
What is the Stay on Target™ Program?
Pilot: Health Education Classes
Certified pharmacist-led classes
Discuss general disease-specific information
Addresses the learning-desire of patients
Improves patient compliance and loyalty
A win-win program that creates additional opportunities for Target particularly in health management.
8Section 2.0 – Proposed Concept
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10
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What is groceryRx™?
groceryRx is a program that incentivizes patients to Stay on Target and eat healthy by discounting food items that are approved to promote positive outcomes for their specific disease state(s).
Empowers Consumers
To take a more active role in managing their health
To reach and sustain positive outcomes
To stay committed to healthy eating habits by offering discounts on specific grocery items that help optimize medication regimens
Empowers Pharmacists
To build stronger relationships with consumers
To offer suggestions on food alternatives
To educate consumers about scientifically-proven diets and potential interactions between their medications and certain foods/products
To help consumers Stay on Target®
12Section 2.0 – Proposed Concept
MedicationsGroceries
Health Education / Decision Support
Incentives / Integrated Health Continuum & Experience
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Why are programs like Stay on Target™ + groceryRx™ needed?
81% consumers see a connection between Food and Health
Many consumers use food as “preventative medicine”
14Section 2.0 – Proposed Concept
Source: IFTF National Survey 2007
Future Potential of Stay on Target™ + groceryRx™
15Section 2.0 – Proposed Concept
Target can become the primary customer touch-point to direct patients to the appropriate care channel and manage all health and wellness information, integrated with their other
health-related purchases and choices.
Disease Management
Tools
Wellness Applications
Clinical Research Management
Tools
Electronic Medical Records
Hospital or Health System
Rx and Dx Information
Primary Care Practice or Network
Purchase History Others / TBD
Television Mobile phone Computer
Key partnerships can facilitate greater consumer interaction
Health Management Platform
SWOT Analysis
16Section 2.0 – Proposed Concept
Strengths Weaknesses
• Follows Target® Core Values • Increases Medication Compliance• Increases All-Store Revenue• Builds Consumer Loyalty
• Cost of Implementation• Exclusivity• Privacy of Buying Patterns
Opportunities Threats
• Attracts New Pharmacy Patients• Brand Differentiation• More Educated & Healthy Consumers
• Competitive Market• Price Motivations in an Improved
Economy
Business Case & ROI
Section 3.0
17
Estimated Program Cost
18Section 3.0 – Business Case & ROI
Estimated cost is conservative; utilization of internal Target employees and resources will decrease the overall cost of the pilot.
A. Per Diem Support
Item Hours Avg. Hourly Rate Total CostHourly Pharmacist(s) (Per Pilot Store) 108.0 40.00 4,320
3 hours per session (including pre/post prep) x 3 sessions per weekDiscount Program for groceryRx (To Be Discussed) N/A
Leverage current Target discount program; Additional % depending on Target's internal pricing strategy
Total Hourly Labor Expense 4,320
B. Capital Request
Item Total Cost Health Education Desk / Section (Per Pilot Store) 5,000
Reconfiguration of available space into a health education desk/areaWebsite and Mobile App Development (Fixed) 15,000
Leverage internal Target IT resources(Source: Interview with IT Solutions Development Executive, January 9, 2013)
Capital Request - Subtotal 20,000
TOTAL COST (3-month pilot per pilot store) $24,320
Estimated Program Benefit (Quantifiable)
19Section 3.0 – Business Case & ROI
Estimated quantified benefit is conservative; overall ROI can be further augmented via private and public grant opportunities as well as partnerships with insurance and other
private organizations.
Opportunity Total RevenueIncrease sales per transaction (10%) + Penetration Rate (10%)(Based on increased purchase frequency and increased purchase of higher priced items) $55,921 Increase new customers and/or frequency of visits due to new value-added program TBD
TOTAL REVENUE (3-month pilot per pilot store) $55,921
ASSUMPTIONS a) 2010 Median weekly sales per supermarket ($466,011) b) 2010 Sales per customer transaction ($26.78) c) 2010 Average number of customers per week (17,401 per supermarket) d) 33% All customers 'strongly agree' that they actively look for healthy food and beverages e) 30% Average price premium of organic fruit and vegetable (over conventional products)
Sourcea, b, c: fmi.org; Accessed January 9, 2013d: IFTF Future of Health and Food Retailing, 2008 e: CBS News, 2009
Other Program Benefits (Non-Quantifiable)
Address an increasing concern over customer acquisition and retention
Offer a service focused on reducing the spiraling health costs that burden customers and payers
Capture a growing segment of the population interested in healthy lifestyles
Offer this program to Target employees in order to reduce the cost of insurance claims and improve employee productivity
Create partnership opportunities with other organizations
20Section 3.0 – Business Case & ROI
ClosingSection 4.0
21
Target is positioned to add to the provision of care in two of the three areas currently served by primary care physicians.
22Section 4.0 - Closing
Wellness Examinations
Primary Care
Physician Practice HAND OFFHAND OFF
• Prescription Management
• Food Purchase/Intake Advice
Oversight of Chronic Disease Management & Prevention via Health
Education
Practice of Medicine
Target is well-positioned to provide these services through its health education and effectively leveraging
its access to key consumer information/data.Stay on Target® SeminarsgroceryRx™
As healthcare becomes more patient-centric, companies that have strong connections with consumers will play a vital role.
23Section 4.0 - Closing
Leverage pharmacists that are “remarkably underutilized given their education, training and closeness to the community…”
Target’s access to millions of customers can be leveraged to create greater value by vertically integrating its assets.
• Strategically emphasize food and household essentials
• Brand strategy focusing on ‘value’ – “expect more, pay less.”
• Healthcare market growth • Access to prescription, grocery, and general
consumer data
Unique opportunity to be the primary customer touch-point for wellness and disease management education.
Questions?
24
References Ammerman, Alice, DrPH, RD, Michael Pignone, MD, MPH, Louise Fernandez,
PA-C, RD, MPH, Kathleen Lohr, PhD, Alissa Driscoll Jacobs, MS, RD, Carla Nester, MD, Tracy Orleans, PhD, Nola Pender, PhD, Steven Woolf, MD, MPH, Sonya F. Sutton, BSPH, Linda J. Lux, MPA, and Lynn Whitener, DrPH, MSLS. "Counseling to Promote a Healthy Diet." Ncbi.nlm.nih.gov. National Center for Biotechnology Information, 30 Apr. 2002. Web. 1 Nov. 2012. http://www.ncbi.nlm.nih.gov.lp.hscl.ufl.edu/books/NBK42768/.
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References (Cont’d.) Guerin-Calvert, Margaret E., and Guillermo Israilevich. "Assessment
of Cost Trends and Price Differences for U. S. Hospitals." American Heart Association. Aha.org, 1 Mar. 2011. Web. 11 Nov. 2012.
"Information for Pharmacists | CCGP." Information for Pharmacists | CCGP. Commission for Certification in Geriatric Pharmacy, 15 Nov. 2012. Web. 15 Nov. 2012. http://www.ccgp.org/boardcertification/pharmacy.
Lamberts, Egbert J., PharmD, MBA, Marcel L. Bouvy, PharmD, PhD, and Rolftive P. Van Hulten, PharmD, PhD. "The Role of the Community Pharmacist in Fulfilling Information Needs of Patients Starting Oral Antidiabetics." Research in Social and Administrative Pharmacy 6.4 (2010): 354-64. Print.
Longley, Robert. "Census Offers Statistics on Older Americans." About.com US Government Info. About.com, 15 Nov. 2012. Web. 15 Nov. 2012. http://usgovinfo.about.com/od/censusandstatistics/a/olderstats.htm.
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References (Cont’d.) Network, CIO. "The Big Value In Big Data: Seeing Customer Buying
Patterns." Forbes. Forbes Magazine, 25 Sept. 2012. Web. 17 Nov. 2012. http://www.forbes.com/sites/ciocentral/2012/09/25/the-big-value-in-big-data-seeing-customer-buying-patterns/2/.
Saramunee, Kritsanee, MSc, Janet Krska, PhD, Adam Mackridge, PhD, Jacqueline Richards, MA, Siritree Suttajit, PhD, and Penelope Phillips-Howard, PhD. "How to Enhance Public Health Service Utilization in Community Pharmacy?: General Public and Health Providers' Perspectives." Research in Social and Administrative Pharmacy 8.5 (2012): 355-486. Print.
Tordoff, June, Shih Yen Chang, and Pauline T. Norris. "Community Pharmacists' Perceptions of Services That Benefit Older People in New Zealand." International Journal of Clinical Pharmacy 11096-012-9612-8 34.2 (2012): 342-50. Springerlink.com. Springer Link, 11 Feb. 2012. Web. 10 Nov. 2012.
"Trends in Health Care Costs and Spending." The Henry J. Kaiser Family Foundation. Kff.org, 1 Sept. 2007. Web. 10 Nov. 2012.
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