Cvs Case
Two types of Pharmacy Customers
• Light Users o Filed ~5 scripts per year o ~6.6 Mn defectors
• 69% of switchers due to location
• 13% due to service
• Heavy users o Filled ~40 scripts per year o ~540k defectors
• 44% of switchers left due to service , followed by price at 33%
Revenue per script 59.72 per script
Revenue lost from defection 3,000,000,000+
24% of revenue lost
improvement in service
• only 13% of light users defected because of service so defection reduction from improvement in service will be less. (3.68% – 5.52%)
Existing Process:
Drop-Off -> Data Entry -> Drug Utilization Review -> Insurance Check -> Production -> QA -> Pickup
Drug Utilization Review – Checks if drug is in conflict with anything (like other drugs, weight, gender). If with conflict – HARD STOP, pharmacist would then check to clear or not clear
Problems with the Process
• Overall o 16% of Scripts had unresolved problems at time of pickup o 27% of scripts encountered substantial problem at some point in fulfillment process
• Drop off o Nobody is watching the in-store drop off window o Nobody responds to drive-thru o Tech must choose between serving in-store customers or drive-thru o Customer calling in refill left on hold o Initial interview fails to obtain critical data o Wait times made up/ over –promised o Out of Stock (OOS) not checked
• Data Entry o No Refill Allowed (6% of the scripts)
• Requiring 20 mins to 3 days to resolve o DUR Hard Stop (20% of the scripts)
• But over 90% of hard stops were solved by pharmacists without involving doctor o Insurance Check (17% of Scripts)
• Majority were easy to resolve; date of birth errors, customer changed jobs or insurers
• But scripts continued to be filled even with insurance problems o Person at DE cannot read handwriting o Prescribed medication no longer manufactured/incorrect dosage
• Production and Quality Assurance o Group of scripts arrive
• Light Users o Filed ~5 scripts per year o ~6.6 Mn defectors
• 69% of switchers due to location
• 13% due to service
• Heavy users o Filled ~40 scripts per year o ~540k defectors
• 44% of switchers left due to service , followed by price at 33%
Revenue per script 59.72 per script
Revenue lost from defection 3,000,000,000+
24% of revenue lost
improvement in service
• only 13% of light users defected because of service so defection reduction from improvement in service will be less. (3.68% – 5.52%)
Existing Process:
Drop-Off -> Data Entry -> Drug Utilization Review -> Insurance Check -> Production -> QA -> Pickup
Drug Utilization Review – Checks if drug is in conflict with anything (like other drugs, weight, gender). If with conflict – HARD STOP, pharmacist would then check to clear or not clear
Problems with the Process
• Overall o 16% of Scripts had unresolved problems at time of pickup o 27% of scripts encountered substantial problem at some point in fulfillment process
• Drop off o Nobody is watching the in-store drop off window o Nobody responds to drive-thru o Tech must choose between serving in-store customers or drive-thru o Customer calling in refill left on hold o Initial interview fails to obtain critical data o Wait times made up/ over –promised o Out of Stock (OOS) not checked
• Data Entry o No Refill Allowed (6% of the scripts)
• Requiring 20 mins to 3 days to resolve o DUR Hard Stop (20% of the scripts)
• But over 90% of hard stops were solved by pharmacists without involving doctor o Insurance Check (17% of Scripts)
• Majority were easy to resolve; date of birth errors, customer changed jobs or insurers
• But scripts continued to be filled even with insurance problems o Person at DE cannot read handwriting o Prescribed medication no longer manufactured/incorrect dosage
• Production and Quality Assurance o Group of scripts arrive