NCPA Commends Call for Congressional Oversight Hearing on Pharmacy Benefit Managers, Medicare

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Alexandria, Va. - March 7, 2012

The National Community Pharmacists Association (NCPA) today applauded U.S. Representatives Cathy McMorris Rodgers (R-Wash.) and Mike Ross (D-Ark.) for seeking a congressional hearing to examine important questions surrounding the role of pharmacy benefit managers (PBMs) in the Medicare Part D prescription drug program.

The lawmakers sent a letter outlining their request to Rep. Joe Pitts (R-Pa.), chairman of the U.S. House Energy and Commerce Subcommittee on Health.

"Community pharmacists and their patients are grateful for the leadership of Representatives McMorris Rodgers and Ross in requesting this hearing," said NCPA CEO B. Douglas Hoey, RPh, MBA. "With Medicare Part D premiums, patient co-pays, drug costs and PBM profits all rising each year while reimbursements to community pharmacies continue to decline, it's natural to ask, 'Where's the money going?' This hearing could be an important step toward meaningful reform to achieve more robust competition among pharmacies, lower costs and to align the interests of payers, patients and pharmacies. In addition, the proposed mega-merger of PBMs Express Scripts and Medco would reduce the competition and choices available to Medicare and other large health programs, making a hearing this year all the more warranted."

The letter urges a hearing on how PBMs operate within the Medicare Part D program and to explore the following issues, among others:

  • The "black box" of pharmacy reimbursement—a Part D plan's "maximum allowable cost" or MAC. Currently, independent pharmacies must evaluate take-it-or-leave-it contract offers from Part D plans/PBMs that leave pharmacists in the dark as to how reimbursement caps, or MACs, are determined for many common generic medications, which comprise about 80 percent of drugs pharmacies dispense.
  • How the abusive auditing practices of PBMs continue to impact independent pharmacies and their ability to serve their patients.
  • How PBM preferred networks are undermining seniors' ability to access their independent community pharmacy and prompted seniors' complaints about the lack of clarity of information in the Medicare Part D plan finder and plans' marketing materials.

"We are writing to ask that the Health Subcommittee hold a hearing in this Congress on how PBMs operate within the Medicare Part D program to provide prescription drugs to our nation's seniors," Reps. McMorris Rodgers and Ross wrote. In citing the issues referenced above and others, they asserted that, "We believe that these, among other issues, warrant a full hearing before the Subcommittee" to help improve Medicare Part D.

The letter follows a December 2011 letter and petition, signed by 109 Lancaster County (Pa.) pharmacists and pharmacy employees, asking Rep. Pitts to hold a hearing to explore the business practices of PBMs, including the take-it-or-leave-it contracts, their lack of transparency in financial arrangements, unreasonable auditing practices, and their efforts to push patients to mail order. The letter was presented to Rep. Pitts by NCPA and the Lancaster County Pharmacists Association.

The National Community Pharmacists Association (NCPA®) represents the interests of America's community pharmacists, including the owners of more than 23,000 independent community pharmacies. Together they represent a $93 billion health care marketplace, dispense nearly 40% of all retail prescriptions, and employ more than 315,000 people, including 62,400 pharmacists. Independent community pharmacists are readily accessible medication experts who can help lower health care spending. They are committed to maximizing the appropriate use of lower-cost generic drugs and reducing the estimated $290 billion that is wasted annually by improper medication use. To learn more go to or read NCPA's blog, The Dose, at

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