Patients’ Pharmacy Access Relies on Fair Pharmacy Reimbursement

Background

Patients need reliable access to community pharmacies, which need fair reimbursement to stay in business. About 80 percent of drugs dispensed are generics, which pharmacists promote to help save beneficiaries and Medicare money.

Prices for many generic drugs are skyrocketing by 1,000% or more virtually overnight, yet Medicare drug plan middlemen known as pharmacy benefit managers (PBMs) may wait months to update reimbursement. That leaves independent community pharmacies with losses of $40 to $100 or more per prescription. Such losses are unsustainable for community pharmacies or any other small business.

In addition, the lack of transparency calls into question whether PBMs are paying pharmacies low and charging much higher rates to health plans, including Medicare Part D drug plans. This practice of "spread pricing" was examined in a recent Fortune magazine article entitled "Painful Prescription."

Solutions

At the federal level, bipartisan legislation known as The Generic Drug Pricing Transparency Act, H.R. 4437, has been introduced by Reps. Doug Collins (R-Ga.) and Dave Loebsack (D-Iowa). The proposal would allow a pharmacy to know how its individual maximum allowable cost (MAC) reimbursement rates for multisource generic drugs would be determined (but not those of other pharmacies in that particular health plan's pharmacy network). It would also require payments to be updated more frequently to keep pace with actual market costs.

In introducing the bill, Rep. Collins said: "A pharmacist often must provide crucial, very personal reassurance to their customers. A pharmacist can't provide certainty to a patient if they're operating with this kind of uncertainty about how much they'll have to pay for their stock. This is something we can do to create transparency and fairness in how prescription drugs reach customers—our constituents."

Rep. Loebsack added, "I have personally met with many Iowa pharmacists, and I have heard time and time again their frustrations with the unpredictability of reimbursement for generic drugs. In order for our local, community pharmacies to continue to provide quality service to our seniors, we must ensure that pharmacists have accurate, up-to-date information about drug pricing. This is critical to maintain access to affordable drugs for seniors, many of whom are on fixed incomes and face high health care costs."

Sixteen states have enacted legislation comparable to H.R. 4437.

Click here to read real-world examples of the egregious prescription drug losses that threaten the viability of small business community pharmacies.

Take Action:

Consumers:

Urge your Members of Congress to support H.R. 4437.

Pharmacists:

Urge your Members of Congress to support H.R. 4437.

Engage your patients in the Fight4Rx grassroots advocacy network at www.fight4rx.org.

Share your support for #communitypharmacy. Follow NCPA on social media:

Generic Drug Losses Unsustainable for Independent Community Pharmacies

The National Community Pharmacists Association has surveyed more than 1,000 community pharmacists. Respondents cited problems with over 600 drugs and reported losses on drug claims including the following examples. Many of these involve a drug plan’s maximum allowable cost (MAC) limit on generic drug reimbursement. Here are some of their stories:

  • A patient was paying close to $200 per box of #12 promethazine 25 mg suppositories because we were losing around $100 when we filled it on her insurance. The patient is on promethazine chronically, and she had to purchase this several times despite having good Medicare D coverage. The insurance company has still not updated the price for this product after 4 months.

  • Digoxin 0.125mg cost $31.20 paid $11.61 by Medicare D plan

  • PRAVASTATIN 10,20,40, AND 80MG TABLETS INCREASED OVER 300% APPROXIMATELY 6 MONTHS AGO AND [PBM] STILL HAS NOT BEGAN REIMBURSING AT THE HIGHER RATE RESULTING IN MONTHS OF LOSSES. OTHER EXAMPLES SIMILAR TO THESE MAY PREVENT ME FROM REMAINING IN BUSINESS COUPLED WITH PREFERRED PHARMACIES FROM MEDICARE PART D

  • Price doubled on isosorbide dinitrate 40mg tabs in June. We are still waiting on [PBM] to update their reimbursement. We still are reimbursed at the price from six months ago. We dispense this to a Medicaid patient through Medicare Part D. She has zero copay, but our facility has to absorb the $50 loss every time we dispense.

  • Today I had a prednisolone acet. ophth 10ml rx filled that I lost $28 dollars on. Getting paid $82 dollars on something that costs me $110. this is a Medicare Part D rx

  • Today I had a rx for etodolac xl 500mg that I am losing $65 when I dispensed the rx due to this increased price of product and lag time by the insurance co on the reimbursement. This price increased happened several months ago and still at a loss. This is a medicare part d patient.

  • Yesterday I had a rx for for a medicare part d/medicaid patient and divalproex er 250mg. As it currently stands, I lost over $354 dollars on this one rx yesterday. This price increase happened months ago. I had another depakote er 500 today that I am losing over $68 dollars on.

  • Desonide 0.5% Lotion on Part D loss of 126.12

  • digoxin increase over 600% medicare part D plans not updating formulary and Medicare D plans do not price adjust, when calling the help desk you are not routed to appropriate department to resolve the issue.

  • FOR PAST 5 MONTHS INCLUDING TODAY, WE EAT $ 40.54 ON CARBIDOPA LEVADOPA ER 50-200 FROM PART D

  • Morphine ER 100mg went from about $40 per 60 to over $150 per 60 overnight. The reimbursement has SLOWLY gone up from 55 in August before the increase to still 56 after the increase in Sept to 67 in Oct to now 133, which is still below acquisition. This is a Part D plan.

  • [PBM] MADE US EAT $ 345 ON MORPHINE ER 60 MG FOR A TERMINAL CA PATIENT FOR SEVERAL MONTHS EACH

  • CLOMIPRAMINE 25MG CAPSULE pharmacy cost was $463.12 for 60 caps we were reimbursed $18.43 this was a medicaid patient.

  • Filled a Clomipramine rx for a group home resident on medicaid. Lost $2000 on that one prescription, but had to fill for continuation of therapy for the resident

  • Morphine ER 200mg now cost over $5.00 per tab. Medicaid reimbursement is $3.40 per tab in Alabama. I lost $176.40 on the Rx. So far no adjustment from Ala medicaid

  • We have a patient on clomipramine 25mg who is in group home for mentally handicapped adults who needs this medicine for behavioral control. We filled this several time over a five months period and in doing so lost $3700.00 (that is correct $3700.00) because medicaid did not adjust their reimbursement for over 5 montths!!!

  • Yesterday I had a rx for for a medicare part d/medicaid patient and divalproex er 250mg. As it currently stands, I lost over $354 dollars on this one rx yesterday. This price increase happened months ago. I had another depakote er 500 today that I am losing over $68 dollars on.

  • Albuterol 4mg- cost $221.55 paid $14.73 by Medicaid for 49 tablets

  • MAC prices on generics that triple in price overnight are not updated for several months. That means we lose dollars on each Rx for several months. The PBM will NEVER go back to the date the generic actually increased in price and reimburse the difference. We are just expected to absorb the cost.

  • There is no incentive for PBM's to correct MAC errors. They reap the reimbursement while we dispense at a loss. This needs to be corrected.

  • This process takes too much time for me to perform. PBMs design it this way.

  • If they correct the MAC they are still unwilling to reimburse you for the incorrect pricing on their part. Thus you lose the money for their mistake and they are unwilling to pay you back for it. And if you tell them that you are being paid below your cost then they just state that’s the contract price and there is nothing you can do to combat it. Also I have on record of how the reimbursement reduces by over 30% at least every 6 months; however, my cost to buy the medication does not decrease. Thus my average dollar reimbursement from many PBM's is around $2.00 when it costs me around $8.00 to fill a prescription in total expenses involved to fill.

  • The MAC appeal process is specifically designed to discourage the use of the MAC appeal process. It can take an hour of staff time to fill out the forms and submit them; it can then take weeks or months to get an outcome all in an effort to get the $10 we were paid below our cost.

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