NCPA Executive Update

NCPA Executive Update delivers insights on legislative, regulatory, policy, and industry developments from NCPA CEO B. Douglas Hoey, Pharmacist, MBA, to NCPA members and pharmacy leaders every Friday.

Patient Advocates & Pharmacy Payment-ese | NCPA Executive Update | September 15, 2017

by NCPA | Sep 15, 2017

Dear Colleague,

Doug Hoey

As pharmacists, we know all about PBMs, and we speak "pharmacy payment-ese" fluently. Unfortunately, talking about PBMs and the pharmacy payment system is Greek to almost everyone else.

Earlier this week, at the National Press Club in Washington, D.C., NCPA co-hosted a forum, "Principles for Patient Centered Drug Coverage," with the Center for Medicine in the Public Interest. The attendee list included consumer and advocacy groups for specific disease states. Why? We wanted to share with them the payment "Greek" that impacts prescription access and costs for virtually every consumer and payer.

Scrutiny of the enormous control PBMs exert over prescription drug payments has grown exponentially over the last year (thanks in part to NCPA's efforts). The issue catalyzed during last year's Congressional hearing on the dramatic price increase for EpiPen, where it was revealed that the manufacturer (Mylan) was only partially to blame for the 500 percent price increase. The other culprit that previously had been flying under the radar was, of course, the PBM. That fact opened the eyes of legislators and reporters. Since then there have been dozens of stories published about how PBMs contribute to the higher costs of prescription drugs.

Those have drawn the attention of consumer and patient advocacy groups who are seeing rapidly rising prescription drug prices, patient access limited, and consumers forced to use mail order pharmacies, and are wondering "What gives?"

Our Monday forum was helpful in educating many interested groups—outside the pharmacy space—who are still forming their opinions. Thanks to RxPlus Pharmacies, Georgia Pharmacy Association's Academy of Independent Pharmacy, and Smith Drug Company / Burlington Drug Company / HealthWise Pharmacy for their support in helping make the forum possible.

One of the panelists, Dr. Mark Fendrick, who is director of the Center for Value Based Insurance Design at the University of Michigan, had the right take on the issue of healthcare costs. The discussion frequently focuses on decreasing health care spending, but Fendrick argues the goal shouldn't be cost reduction; it should be improving health outcomes. Instead of working to spend less on health care, we should focus on spending more, efficiently. He said there are two components to accomplishing this goal: 1) identify, measure, and eliminate services that do not make people healthier, and 2) fund underutilized services.

That was one of the reasons for the forum—to find a better way than the current payment model, which puts the 10 percent of healthcare costs spent on prescription drugs in a silo. We need an integrated model that leans on properly used prescription drugs to control overall healthcare costs. In contrast, as panelist after panelist revealed at the forum, what PBMs seem to do best is make money—often at the expense of patients, plan sponsors, and yes, pharmacies.

PBM tactics not only fail to make people healthier, but they also can wreak havoc on your business. PBMs use retroactive DIR fees to collect a portion of your reimbursement amounts. If you want to know how to confront that issue, attend Prepare for Impact! DIR Estimation and Mitigation Strategies for Your Pharmacy Back Office at next month's NCPA Convention in Orlando. (The Gaylord Palms Resort is up and ready for business after Hurricane Irma, by the way, and we're happy to be able to convene there and boost a Florida economy that is reeling from that catastrophic storm. But if you're coming—and I really hope you are—you need to book your room NOW. The special rate ends this Friday.) The DIR session will bring you up to date on the available business tools that will help you forecast the financial hit, better manage cash flow, and minimize the dollar amounts being taken back from your operations.

The National Press Club is known as "the place where news happens." While our discussions would have been no newsflash to pharmacy owners, this week's forum was an important step in informing the opinions of non-pharmacy groups interested in a new and better prescription payment system.

Doug Hoey

P.S. The Surescripts-Allscripts partnership to provide pharmacists in hurricane impacted areas access to patient-specific medication history data has now been expanded to include Alabama, Florida, Georgia, North Carolina and South Carolina for a limited time. With a 12-month view of a patient's medication history information, pharmacists can limit adverse drug events and avoid errors, particularly when treating patients who have been displaced and may not have their prescription information available. To access the service, follow the steps listed here. ALSO: You can help pharmacies that have sustained hurricane damage. Donate to the NCPA Foundation's Disaster Fund today. Every penny donated goes to affected pharmacies.