NACDS, NCPA Urge Congressional Panels to Reject Administration's TRICARE Plan Which Would Penalize Patients Who Utilize Community Pharmacy

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Associations urge increased generic drug utilization

Alexandria, Va. - Nov. 17, 2011

The National Association of Chain Drug Stores (NACDS) and National Community Pharmacists Association (NCPA) sent joint letters to the Joint Select Committee on Deficit Reduction and the U.S. Senate Armed Services Committee, encouraging the rejection of an Obama administration proposal that would saddle TRICARE beneficiaries with higher prices and penalize their utilization of community pharmacists, who help reduce costs and improve health outcomes.

The Obama administration's proposal would force TRICARE beneficiaries to pay 30 percent of the cost of their medications at a retail pharmacy without capping annual cost sharing, while mail-order prescriptions would include far lower out-of-pocket costs. The administration's plan would also increase costs by ending the incentive for drug manufacturers to offer additional price concessions to the Department of Defense beyond those required by law, as the TRICARE program would equalize cost sharing between preferred and nonpreferred medicines.

In the letters, NACDS and NCPA urged the Committees to abandon that proposal, and instead support other balanced policy alternatives to increase generic drug utilization, which would reduce costs without restricting patient access to healthcare professionals. Studies have shown that community pharmacists, through face-to-face consultation, save twice the amount as mail order call centers.

"Rather than instituting changes that unfairly penalize beneficiaries and drive up prescription drug costs, we urge you to increase generic dispensing rates in both the TRICARE retail and mail order settings," NACDS President and Chief Executive Officer Steven C. Anderson, IOM, CAE and NCPA Chief Executive Officer B. Douglas Hoey, RPh, MBA wrote. "We feel strongly that a greater reliance on mail order will not only fail to produce the needed savings, but will also compromise patient care, increase waste, and penalize those who wish to have their prescriptions filled at their local pharmacy."

Generic drug use in TRICARE continues to lag behind other healthcare programs. The program could save $11 billion over ten years by working with community pharmacists to maximize the appropriate use of generics and by holding its pharmacy benefits manager accountable for generic drug dispensing rates, particularly at mail order. The associations believe that this cost savings should be considered as Congress prepares the National Defense Authorization Act for FY2012 and deficit reduction proposals.

NACDS and NCPA have long-worked with Congress on the importance of continued access to community pharmacy for TRICARE patients. The groups will continue to urge lawmakers to support policies that would effectively reduce costs and improve health outcomes without penalizing veterans, military service members and their families from seeking assistance from their community pharmacist, the face of neighborhood health care.

The National Association of Chain Drug Stores (NACDS) represents traditional drug stores, supermarkets, and mass merchants with pharmacies—from regional chains with four stores to national companies. Chains operate 39,000 pharmacies, and employ more than 2.7 million employees, including 118,000 full-time pharmacists. They fill nearly 2.6 billion prescriptions annually, which is more than 72 percent of annual prescriptions in the United States. The total economic impact of all retail stores with pharmacies transcends their $830 billion in annual sales. Every $1 spent in these stores creates a ripple effect of $1.96 in other industries, for a total economic impact of $1.57 trillion, equal to 11 percent of GDP. NACDS represents 137 chains that operate these pharmacies in neighborhoods across America, and NACDS members also include more than 900 pharmacy and consumer packaged goods suppliers and service providers, and over 60 international members from 23 countries. For more information about NACDS, visit

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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