Justifying a Residency Program and Showing a Return on Investment Janet Teeters, M.S. Director of Accreditation Services.

Justifying a Residency Program Justifying a Residency Program and Showing a Return on and Showing a Return on

InvestmentInvestment

Janet Teeters, M.S.

Director of Accreditation Services

Objectives:

Why ↑ demand for residency positions Why you might want to start or expand a program Financial and non-financial elements to consider

when justifying a program

Pharmacists in 2020

PharmacogeneticsGene TherapyNano TherapyMolecular Target Therapy

To support the position that by the year 2020, the completion of an ASHP-accredited postgraduate-year-one residency should be a requirement for all new college of pharmacy graduates who will be providing direct patient care.

ASHP Position Statement approved June 2007

Residencies are the bridge between Education and Practice

Helping to develop clinical & professional maturity

What’s Happening with Residencies?

Although we are growing more programs, the demand by new graduates is higher than the supply. Market conditions are changing and employers are seeking ASHP accredited residency trained pharmacists.

Pharmacy Organization Support for Residency

All of these organizations are partners with ASHP at the ASHP Commission on Credentialing table.

Demand from new graduates Pharm. D. entry level degree –everyone has the same

degree and individuals need to find a way to differentiate themselves. Additionally colleges are graduating an increased number of students.

“Ideal job” requires residency training Many jobs, not just ideal jobs, now require residencies

(e.g. Health systems) ~19% of new graduates complete a residency, but even

higher numbers seek them Current Economy has tightened up the number of jobs,

while the number of graduates increases,

managers can be more selective in

requiring residency trained individuals

PGY2

Administration Nuclear

Ambulatory Nutrition

Cardiology Oncology

Critical Care Pain/Palliative Care

Drug Information Pediatrics

Emergency Medicine Pharmacotherapy

Geriatrics Psychiatry

Infectious Diseases Solid Organ Transplant

Informatics

Internal Medicine

Medication Use Safety

Opportunities to meet the demand

Increase # Residency Programs

Increase # Residency Positions

Why start a residency?

There must be perceived value…Human Resources side

Recruitment

Retention

Residents cover some staff shifts

If hire your resident No recruitment fees

No interview fees

Advertisement

No outside recruiters Reduced Training costs No relocation expenses You know the person

Perceived value… Service

Residents expand your normal scope of service

Improve patient care

Keep services and staff progressive

Residencies tend to drive innovation

Projects

CQI

Perceived value…Cost AvoidanceImproved Financials

P&T (therapeutic substitution)

DUE

↓ Medication Errors/ ADR

↑ Interventions

Special Projects focusing on cost reduction

Perceived value… Education

Precept Students

Education for Techs, R.Ph., RN, MD

Interdisciplinary focus

Improved credibility

If perceived value: How to begin?

Initial assessment Costs of the program Support for program Part I Core Elements Program Design Individuals Role Part II

Initial assessment Organization

– Mission/Philosophy – does it include education?– Patient types & Volume – do you have enough variety and

volume to support a program?

Department– Staff (experience, interest, commitment, presence)– Services (wide scope & depth)– Complete ASHP Pharmacy Practice Model Initiative (PPMI)

Hospital self assessment (if a hospital)

http://www.ashpmedia.org/ppmi/ Complete “RU Ready”

http://www.ashp.org/menu/Accreditation/ResidencyAccreditation/RUReadyTool.aspx

Costs of a residency program

Preceptor and program directors time Space and equipment Stipends & benefits of residents Travel Recruitment expenses Training of Preceptors Accreditation Fees

You will need detail to receive CMS funding

Gathering support

Pharmacy Physicians Nursing Administration

Business Plan

Description Market analysis Costs Value to offset costs (intangibles and financials)

CMS Inpatient Reimbursement Pass through funding for hospital run pharmacy residencies, if you meet their criteria, and are ASHP accredited

Executive Summary

Refer to your hospital for their format

Costs – 2 residentsResidents stipend & benefits $87,500

(2 residents @ $35,000 +25% benefits)Travel $ 4,000

(2 residents MCM, Regional Residency Conf)Accreditation Fees $ 3,655

(2010: $780 application fee 1X & $2,875 annual assessment -1 program) Residency Program Director $ 8,600

(4hr/week X $43/hr x 50 wks)Preceptors $21,500

(10hr/week X $43 x 50 wks)MISC – copying costs, etc. $ 1,000Residency Showcase $ 555

TOTAL $126,810

Offset Costs (2 residents)

CMS Funding (PGY1 only) – direct costs $63,405(Est same % as Medicare Pts $126,810X 50%)

CMS Funding indirect costs $ 25, 362 (see your finance dept 20% of directs?)

Staffing commitment (not paying RPH) $ 34,944 (Every other Weekend 16hr/wk x 52 weeks x $42/hr RPH Shift diff)

Sub total $123,711Once established:Projects that reduce costs (therapeutic substitutions, DUE) ????Hire 1 resident (soft costs)

↓ recruitment $ est $15,000, ↓ training time 3 months 480 hr X $40/hr est $19,200 $34,200

SUBTOTAL $157,911

Versus costs $126,810

This does not address intangible benefits

Include intangible benefits

Innovation

Progressive staff

Recruitment & Retention

……

Where’s the $ coming from?

One-time start up costsGrants (Foundation, state, college, industry)

Vacant FTE 1RPH ~ 2 ResidentsRN, MD vacancies

Partnersshared cost

Justification may be enough

How will you justify or show a return on investment of your residency?