The Playbook for a Community Charitable Pharmacy

Funding & Sustainability

After opening the doors to your community charitable pharmacy, mechanisms need to be put in place to ensure your continued involvement for the health of the patients and community you serve. Develop an informed, dedicated, and dynamic governance board. Plan for implementation of growth and sustainable funding. Build relationships and collaborations with healthcare providers and others who are mission-minded within the community and beyond. Be a voice for those you serve and the impact of the service.

A “nonprofit corporation” is a legal term. This status is given by state and federal government to a corporation that fits a specific set of criteria. When credited with the term “nonprofit corporation”, the company then exists for the benefit of, and is theoretically owned by, society. The community owns the nonprofit company, and the company exists to serve the community. Charitable pharmacies are always organized as a nonprofit corporation.

But companies require leadership if they are to be successful. Standing in the place of the community’s ownership of a nonprofit is an acting governing board. Therefore, the governing board is the legal “caretaker” of nonprofits, serving on behalf of its owner, society. A governing board has the responsibility to manage a nonprofit corporation, its vision, its daily work, its finances and the completion of its outcomes. Typically, members of a nonprofit board are volunteers and not paid for their volunteer services. Instead, they meet, decide, serve, and operate as community volunteers, for the benefit of the community, responsible to the community.

A governing board works with the staff to achieve the mission of a community charitable pharmacy. While the Board of Directors, or Governance Board, is the final authority over a nonprofit corporation, the board does delegate a specific set of activities to the staff and the staff relies on the board for its critical leadership role. That delegation can be summarized as the board behaving as the legislative, judicial and strategy role of a company (setting policy, establishing vision and creating clarity when there is disagreement). In turn, the staff should behave as the executive branch, executing the work of the company.

A governing board is responsible for all activities of a nonprofit corporation; however a few roles stand out with particular focus for board members as the primary role of a board of directors:

  • Mission– It is the role of the governance board to make sure that the community charitable pharmacy is working toward and achieving its mission, and doing so in a way that ensures efficient stewardship of resources. That means setting goals, reviewing progress on goals, and holding the community charitable pharmacy accountable to the work. The mission of the organization is a legal statement, with the nonprofit status awarded in part due to that mission. The board protects the organization and serves society by working toward the completion of that mission.
  • Compliance – Good organizations keep their promises and do the work in the right way. It is the role of the board to make sure that the community charitable pharmacy is behaving in a way that is ethical, that all staff members are working under the authority, and within the ethical guidelines, of the organization. This is a critical role for all healthcare organizations, especially those that deal with expensive medications, valuable patient medical histories, and large sums of vendor and funder resources.
  • Policy – It is the role of a governance board to establish and then memorialize policy for a community charitable pharmacy. Policies can be organized as formal statements, such as a Standard Operating Procedure or a staffing But policy can also refer to best practice or mundane management decisions, such as the practice of holding a monthly board meeting on a certain recurring date and time. Sound policy creates safety, efficiency, and risk reduction for a community charitable pharmacy.
  • Relationship network manager – Community charitable pharmacies require a massive network to run. Vendors, suppliers, patients, donors, volunteers– a typical community charitable pharmacy requires many hundreds of contributors if it is to be successful. It is the role of the board of directors to cultivate relationships with the community, and to honor each member of the network in the appropriate way. Tools used in network management include annual reports, on-time IRS filings, board minutes, events to celebrate successes, and outreach. The board of directors operate as ambassadors to the community, bringing in resources and maintaining connection.
  • Funding – It is the role of the board of directors to ensure that the funding for the enterprise is available for the work to happen. Often staff members are hired to assist with the work of fund development (e.g: grant writers, event planners, development coordinators). However, it is the responsibility of the board of directors to plan for the cost of the work, and to make sure there are enough dollars to do the work. And if there are not enough dollars, it is the responsibility of the board to address closure, mergers and dissolution.
  • Volunteers– While it is the volunteer role of the board of directors to guide a community charitable pharmacy, the board of directors also serves as a volunteer base of support, assisting the company in day to day operations, and filling gaps where the staff
  • Strategy – Finally, it is the role of the governing board to identify strategic direction and to move toward that strategy in a way that is plausible and efficient. Key to the success of a community charitable pharmacy is the ability of a board of directors to identify strategy and then work to accomplish that strategy.

Accepting a role on a board of directors for a community charitable pharmacy has consequence. Not only are all the roles listed above requirements for a board member as they serve in their collective leadership capacity. Board members also have requirements for their individual behavior, which is: to act in a way that has fidelity with the role of caretaker of a community-owed effort. Outlined by the National Council of Nonprofits, board membership includes the following individual duties:

  • Duty of Care: Take care of the nonprofit by ensuring prudent use of all assets, including facility, people, and goodwill.
  • Duty of Loyalty: Ensure that the nonprofit’s activities and transactions are, first and foremost, advancing its mission. Recognize and disclose conflicts of interest. Make decisions that are in the best interest of the nonprofit corporation, not in the best interest of the individual board member (or any other individual or for-profit entity).
  • Duty of Obedience: Ensure that the nonprofit obeys applicable laws and regulations, follows its own bylaws, and that the nonprofit adheres to its stated corporate purposes/mission.
Creating a Governing Board:

Building a board of directors is as much art as science. Most nonprofits create their board over the course of several years, concurrently building strong relationships while they grow the capacity for effective board management. The goal is to quickly have in place a small community of capable leaders (7 to 19 members, depending on the need of the community charitable pharmacy) who are a joy to work with, and who effectively adjudicate their responsibilities as a board.

Building a board of directors is difficult work. It requires a great number of responsible and ambassadorial leaders to come together for a clear goal, and to be ready to compromise their own interests for the benefit of the community. While creating a board is complex, a key success factor is to have in place a leader who is adept at balancing vision for the creation of the effort, with effective people skills. The champion of the board will be responsible not only for bringing a group of like-minded leaders together, but also to create the kind of vision focus and behavioral norms for the group to be effective as a collaborative body. Some key roles include:

  • Board members as non-experts – Board members have a role. Place board members who can fulfill that role. Do not be bashful to insist that board members are committed to the work, follow through on assignments, and are pleasant to work with. Board leadership means working with people over the course of months and years in complex projects. Emotional maturity, reasonableness, and communication skills are required of board members if they are to complete such difficult work in a way that is satisfying to the culture of the group. A board member does not need to be expert in the details of pharmacy management. However, they should be a learner – a learner of the organization, a good listener when working with others, and a leader humble enough to ask questions when they do not understand detail. A learner is a person who can behave in a way that promotes excellence, even when they are not excellent at such a specific topic as pharmacy operations.
  • Board members as experts – It is standard practice for board members to behave as topic experts. Since the board of directors operates in a role as experts, the placement of high quality leadership onto the governing board is a top concern. Specific valuable assistance for a community charitable pharmacy includes filling roles such as: attorneys, financial experts, CPAs, human resources and management experts, lobbyists, and industry leaders. Finally, consider placing leaders who are skilled in the topics important to a pharmacy, such as formulary design, pharmacy operations, and business management.

When building a board of directors for a community charitable pharmacy, consider using the process of filling the officer positions as an opportunity to empower co-laborers of specific skill and integrity into places of influence. A specific concern in creating a board of directors is to place the best board officers in their respective roles of Chair, Secretary, and Treasurer. Some suggestions for each include:

  • Board Chair – The role of the board chair is specifically to serve the needs of the board. This means that the Chair is responsible to cultivate the effectiveness of the board of directors, and to manage decision making. Rather than being the sole driver of strategy and action, a board chair’s role is more defined as being the ambassador among the board, and the leader of board effectiveness in creating and defining strategy. Some keys for the board chair roles include: setting and chairing meetings, surfacing the values and vision within the board, setting the agenda that will identify strategy, and reviewing and addressing the behavior of the CEO and other board members.In a statement, the board chair is responsible for the board’s effectiveness, as the CEO is responsible for the staff’s effectiveness. Therefore, selection of the board chair should consider questions like: Is this person responsive and able to fulfill the duties of the board chair? Does this person have the necessary balance between mediation and management, with the skills to create bridges to others, while moving the group forward? Is this person capable of taking responsibility for themselves and that of the board? Is this person pleasant and easy to work with?
  • Secretary – The role of the secretary is to help create, and then safeguard, the decisions of the board and to be responsible for all filings required of a board of directors. More than taking minutes, the secretary can be helpful to the board chair and the CEO in moving a board to definitive, actionable decisions. The secretary is also central in communication and notices, issues likely addressed by a community charitable pharmacy’s bylaw. Finally, the secretary is responsible for keeping records, presenting, and getting approval of the decisions which have been made.In placing a secretary, some questions to consider are: Is this person organized? Is this person ethical? Is this person equipped with the necessary abilities to move a room to a clear decision, actionable for the staff? Is this person pleasant and easy to work with?
  • Treasurer – The primary role of the treasurer is to oversee the financial position of a community charitable pharmacy, being the representative of the governing board on all matters that are financial. In day to day practice, this duty may include assessment and presentation of the finances of the company (for a large nonprofit), or may be as detailed as completing the actual company bookkeeping for smaller organizations. The role of the treasurer varies by corporation and is likely outlined in the corporation’s bylaws. However, it is the role of the treasurer in assuring that all dollars are stewarded in an effective and ethical way.In placing a treasurer, some questions to consider are: Is this person organized? Is this person ethical? Is this person equipped with the necessary abilities to assess and communicate the financial position of a community charitable pharmacy? Is this person pleasant and easy to work with?
Governance Board Self-Assessment

Once the board is in place, it is helpful to regularly (annually) assess the board members understanding of the mission of the charitable pharmacy, the by-laws, their roles as board members, and contributing to the needs of the organization, financial, and other. The self-assessment tool is used to determine gaps and strengths in knowledge and expertise of the board in order to address any issues that are revealed. Future strategies for the board itself and/or the organization can be adjusted based of the results of the assessment.

Ozanam Charitable Pharmacy offers a sample of their Board Self-Assessment.

Though the approaches are different, many of the principles used in seed funding are useful for ongoing sustainability (See: Initial Funding for a Community Charitable Pharmacy). Building relationships, Speaking the Language as you Market your Fund Development Need, and communication systems (See: Stakeholders and Funders) apply to all types of sustainability. Encourage your philanthropic team to see themselves as partners working for the same goal of serving the uninsured and improving health outcomes as opposed to just donors of funds.

Developing a sustainability plan provides the board and the organization a framework to maintain the longevity of the pharmacy. The plan includes existing and anticipated funding opportunities, engagement with the community, and networking opportunities. Ozanam Charitable Pharmacy offers a sample of their Sustainability Plan.

In conjunction with a sustainability plan is a fundraising or fund development plan (See The Fund Development Plan and the Fund Development Planning Process). Defined are resources and potential resources, marketing for fundraisers, distribution of tasks, and a timeline for each task. Short and long-term goals are set. Ozanam Charitable Pharmacy shares a fundraising plan.

In a Dispensary of Hope webinar on funding, Angie McLaughlin of Community Healthcare Clinic answers “We could never afford it!” with “We can’t afford Not to!” She offers suggestions of bundling grants and including vendor memberships with chronic disease management grants. Justin Coby, Health Partners Free Clinic, suggests using “best practices who don’t know best” to build collaborations, local to national.

Within the area the charitable pharmacy practice serves (neighborhood, community, county, state) a need has been determined that you, as a charitable pharmacy, are meeting. Affordable medication access is a major need, but you as well as healthcare, government and other leaders in your area, may have identified other needs for which your charitable pharmacy is in position to help address. Patient self-management programs for chronic diseases include hypertension, diabetes, obesity, and mental and behavioral health. Healthy living programs include smoking cessation, nutrition, physical activity, and social/emotional wellness. Collaboration with free clinics offers a multi-disciplinary approach to healthcare, allowing the pharmacist to offer clinical services, either as a volunteer or as part of the healthcare team. Providing medication to discharge patients, delivering to patient bedside or home, helps hospitals ensure patients have the medication needed to decrease readmissions. Data collection may lead to grant opportunities as well as improving the lives of patients. See Collaborative Practice for establishing a collaborative practice and Services Offered and Special Populations and Transitions of Care/Handoffs for services pharmacists offer at charitable pharmacies to better meet the needs of their patients and the community.

David Neu, Pharm D and Saint Thomas Health offer:

Top 10 Ways to Grow Your Charitable Pharmacy Volume
#10 Educate referring providers (depending on location):
  • ED practitioners
  • Hospitalists
  • Any other practices that could benefit (ambulatory infusion, dialysis, oncology, etc.)
#9 Marketing Materials
  • Pamphlets, posters, handouts, flyers, both for direct to providers and direct to patients
#8 Educate decentralized and ambulatory care Pharmacists to educate/refer patients
  • When verifying home meds or allergies
  • When providing patient education (CHF, COPD, etc.)
  • Ask the question of medication affordability
#7 Educate case management, social workers
  • Ask patients early in their hospital stay if they can afford medications
  • Review income criteria/application/qualification process
  • Invite to spend time or tour the pharmacy
  • Free coupon until med available at charitable pharmacy, changed to one that is accessible, or acquired through PAP
  • For insured patients, coupon and copay reduction vouchers
#6 Educate financial counselors in hospitals and clinics
  • Income criteria/application/qualification process
  • These counselors are talking to self-pay patients prior to dischargeand regularly at clinics
#5 Associated AND Non-Associated Clinics
  • Any in proximity?
#4 Community agencies

(Helping Hand, Community Helper, Housing Authority, Immigration services, thrift shops, food pantries, etc.)

  • Create mutual referrals
  • Community agencies may be able to pay for utility bills or rent but not help a patient with medication needs
  • A charitable pharmacy can help a patient with Medication Access but can’t pay utility bills or rent
#3 Area Hospitals
  • Network with social workers, case managers, financial counselors
#2 Local Churches and Places of Worship
#1 Word of Mouth
  • Charitable pharmacy patients are one of the best referral sources for new patients
  • They know firsthand the benefit of services
  • They know friends, family, neighbors, parishioners that could be helped
  • Ask patients to tell others, and their places of worship, the story of how they were helped by the charitable pharmacy.

For more ideas to help grow, check Fund Development Decision Tree

TIP: “Patient referrals are one of the biggest referral sources outside patient discharges.” David Neu, Pharm D, Executive Director of Pharmacy, STH

Free Drugconcept and other Safety Net Program patients
  • Other local programs began sending patients to our program without notification
    • Solution: Meet with local clinics & safety net programs to anticipate potential added volume.
  • Consider options to address revenue not secured in dispensing purchased medication.
    • Solution: Institute a Safety Net Drug program at $3.00 (?) per prescription. Apply for grant funding for purchased meds/supplies (diabetic supplies, etc.)
Physicians Not Aware of Available Inventory
  • Prescribers unaware of charitable pharmacy and formulary were not prescribing meds that were available.
  • Increase in patient wait time results in the pharmacist needing more time to resolve therapeutic changes.
    • Solution: Partner with medical leaders across the systems to educate physicians, hospitalists and other key providers
    • Educate prescribers that stock is for short term use until eligible patients receive medication from PAP
    • Distribute current formulary to prescribers who frequently send patients
    • Establish Collaborative Practice Agreement with prescribers to make changes then notify prescriber
Staffing and Stress of Staff (paid staff)
  • Patient and prescription volume grow quicker than anticipated and not initially able to hire additional staff due to budget constraints.
    • Solution: Seek short term (1 year) grant to add additional full-time or part-time staff(social worker, technician. Introduce an automated robot or counting machine to help manage workflow better.
Staffing (volunteer staff)
  • Not enough volunteersto help break down incoming samples, process the inventory, complete paperwork, and maintain patient’s files.
    • Solution: Volunteering for charitable pharmacy was placed on the hospital pharmacy employee evaluation as a way to exceed expectations related to the mission of the hospital.
    • Partner with local university for healthcare and foreign language students for Experiential Service Learning to interact with patients and help maintain pharmacy tasks.
Language and Literacy Barriers
  • Patients whose language is not English without an interpreter
  • Difficulties explaining the program or requirements (proof of income)
  • Forms only in English or patient unable to read English or their primary language
Validating Proof of Income
  • Patients with no income
  • Undocumented workers (paid in cash, no social security number, can’t have a bank account)
  • The number of people in the in household (who should be responsible?)
    • Solution: Require a formalized letter of support from family members, friends, and organizations that help support the patient’s bills
    • Require a letter from the patient’s employer that includes the amount that the patient is paid per week (month or year) and a phone number to call and verify the amount paid for patients who are paid in cash
    • Letter of support does not require a notary as the process was burdensome for the patients
    • Verification of food stamp benefits by using the state benefit website instead of requiring patients to bring in paper copy as proof of income
    • Example of processes in Patient Eligibility/ Enrollment
    • Example forms in Appendices/Eligibility/HDGB EnrollmentForms
Undocumented Workers (proof of income/PAP programs)
  • Patients not eligible for Manufacturer PAP programs but have long term need
  • Documenting proof of income
    • Solution: Some PAPs use soft credit tool to determine income which may work for some patients
    • Use therapeutic interchanges to provide medication from manufacturer with best fit for eligibility
    • If patient meets residency requirements, some programs will accept letter from employer
    • Direct donations do not require supplemental income documentation
    • Some coupons provide discounted med for up to one year if patient can afford low copay
Coordinating physician donations of samplesand Pick ups
  • Need a sustainable supply of medications
  • Supply and demand- donations do not always match what is needed the most
    • Solution: Specify to physician donors what is needed and only accept those donations
    • Complete Track and Trace documentation for all donations. (See: Tracking the Medication Supply Chain)
    • Use therapeutic interchangewhen possible to dispense from present inventory
Maintaining a retail pharmacy environment
  • The program is integrated into a working retail pharmacy
  • Employees and other customer wait times increased to get prescriptions filled/check out
    • Solution: Designate a specific window or area for patient enrollment that stocks enrollment paperwork and clipboards for patients who can read and write to begin enrollment process independently
    • Use various colored bins to designate newly enrolling patients, who expect a longer wait time, versus other patients.

Keep in touch with other charitable pharmacies that may have solved a challenge or are facing the same dilemma.

Charitable pharmacy organizations, as well as other pharmacies and organizations, are a wealth of information: from staffing issues to setting up a collaborative practice, finding volunteers to med destruction. Be involved, and be willing to share your experiences with those who want to learn from you.

It is very important for you to stand up, show up and be present for your mission. Nonprofit advocacy groups are often known as special interest groups, citizen organizations, mobilizing groups, multi-issue organizations, or social movement organizations. The activities in which they participate may be called grassroots action, civic voice, public action, organizing, and empowerment.

Yes, nonprofits organizations are allowed to advocate. Advocating for your mission matters. When done right, advocacy influences public policy by providing a way for individuals and organizations to have a voice. However, it is important to learn the difference between advocacy and lobbying.

Advocacy is the process of stakeholders making their voices heard on issues that affect their lives and the lives of others at the local, state, and national level. It also means helping policymakers find specific solutions to persistent problems. Most nonprofits can and do engage in as much advocacy as possible to achieve their goals. For example, informing a member of Congress how a federal grant your organization received has helped your mission is considered advocacy.

Lobbying, on the other hand, involves activities that are in direct support of or opposition to a specific piece of introduced legislation. While nonprofits can engage in some lobbying, the IRS has strict rules about what portion of their budget can go toward these activities. There are also prohibitions on any use of federal funds for lobbying. For example, asking your member of Congress to vote for or against, or amend, introduced legislation is considered lobbying.

How can you be an advocate?

You can be an advocate by educating policymakers about the needs of your organization and the people you serve, and developing a relationship where you act as trusted voice on policy issues. You also can organize supporters on issues of importance and educate a wider audience on your accomplishments. Some examples include:

  • Emailing or calling your elected officials
  • Organizing meetings or site visits with your legislators and their staff
  • Making your views known to policymakers and your community through traditional and social media

Understand the rules of your state in regard to inviting policymakers to your organization or event, for example if you have to have approval from the State Board of Ethics. Make sure you don’t cross the line. Keep in mind that activities are considered lobbying if they call for action on introduced legislation or a pending regulation.

See Share Results for ideas on presenting the impact of your charitable pharmacy and its services to groups local to national.

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