Hospitals and health systems face familiar and emerging pressures as they seek to expand service lines, develop revenue streams, and explore new methods of care delivery. Service line partnerships can provide innovative solutions to these common issues by bringing together parties with physical assets, key licenses, management experience, access to capital, and other resources necessary to develop a successful service line.

During this webinar as part of our Growth From Within: Hospitals and Health Systems Service Line Expansion series McDermott Partners Emily Cook, Tony Maida, and Patrick Zanayed discussed strategies and considerations for hospitals and health systems looking to expand their services lines through pharmacies.

Top takeaways included:

1. Hospitals and health systems have several options for structuring pharmacy arrangements. These include true joint ventures, joint venture management companies, and pharmacy management services arrangements. Each structure creates different levels of integration and connection with the service line partner and involves different negotiating points, including governance, compensation, implementation and operational responsibilities, service expansion, indemnification, and termination/wind-down provisions.
2. Structuring pharmacy service line agreements requires careful evaluation of regulatory requirements. These nuanced regulatory considerations include 340B program eligibility and participation requirements, tax exemption considerations, Anti-Kickback Statute analysis, and state-specific regulatory requirements.

Explore more webinars in the Growth From Within: Hospitals and Health Systems Service Line Expansion series here.