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.

A Coincidence That May Not Be a Coincidence | NCPA Executive Update | January 19, 2018

by NCPA | Jan 19, 2018

Dear Colleague,

Doug Hoey

Luck. Chance. Coincidence. Dorothy Fletcher had the misfortune of having a heart attack in 2003 while she was on a flight. The flight attendant asked if there was a doctor on board who could help. Not one doctor responded. Fifteen did! And, all 15 were cardiologists! The doctors were headed to a cardiology conference and took the same flight. They were able to keep her stable until the plane made a landing in North Carolina. That was a good coincidence.

But not all coincidences are good.

For example, back in October, NCPA members began reporting to us that CVS/Caremark had slashed MACs on many prescriptions in Medicaid Managed Care plans administered by CVS/Caremark. Coincidentally, the cuts reportedly occurred on about the same day the Wall Street Journal reported that CVS was in talks to buy Aetna for $66 billion. Members have reported that these MAC cuts are some of the deepest they have ever seen and are substantially increasing the number of prescriptions dispensed below their acquisition cost.

NCPA members serve a disproportionate share of Medicaid patients compared to chain drugstores or mass merchandisers, so the gash of slashed MAC reimbursements is even more painful to community pharmacies. If, because of these cuts, those pharmacies decide they can no longer accept the affected Medicaid Managed Care plans, or worse, that they close their doors entirely, it means that the neediest patients, some of whom are the sickest and thus the costliest, may lose access to the pharmacy of their choice or accessible medications.

Here's another coincidence: In the face of these draconian MAC cuts, pharmacies are receiving "Ready to sell?" solicitations. Some people are calling this tactic "squeeze and buy."

You have probably seen some of the solicitations — emblazoned with a chain logo — but here's a select passage: "Let's talk. What is your store worth? I can give you a good idea and answer all your questions." Also: "Why is this a good time to sell?"

Coincidence?

NCPA wants to know if you have received written solicitations to buy your pharmacy in the past three months, and we want you to send those solicitations to us. Scan and email them to michael.rule@ncpanet.org, or fax them to (703) 683-3619.

These MAC cuts are a life-and-death matter for many pharmacies. That's why they're of great importance to NCPA and our state partners, too.

We have discussed with CMS the reports we have received of these severe MAC cuts in state Medicaid Managed Care plans. States are given a great deal of flexibility to administer their Managed Medicaid plans. That flexibility only seems to be increasing in the current political environment.

We have encouraged and assisted state pharmacy organizations to use their local contacts with state officials and media to alert them of the problem. Some of them have done just that. This week, Pennsylvania announced that one of the Medicaid Managed Care plans would be restoring reimbursements to October levels. Hopefully, this will at least restore MAC levels as indicated, though the proof will be in the pudding to make sure all affected product reimbursements revert back and that any increases won't be transient. Here's the letter from the Pennsylvania Pharmacists Association to their members. If these cuts are affecting you, read this letter.

Here are five important ways NCPA is supporting the state work and reaching out on the federal level:

  • We've discussed this issue with CMS to elevate it and to point out potentially unfair trade practices.

  • We're gathering aggregated data on the cuts, as requested by CMS, to help them gauge the extent and effect of the cuts.

  • We've developed and shared a sample letter and tips for NCPA members to use to engage elected officials and policymakers in investigating the issue.

  • We're working with several states on 2018 legislation that would apply the state's MAC law to MMC and/or require MCOs to use fee-for-service rates as a reimbursement floor.

  • We're briefing members of Congress and Hill staffers on MAC issues and the need for H.R. 1316, our federal MAC bill.

There hasn't been a day since Oct. 26, when we first heard about the cuts, that your NCPA staff hasn't focused on this issue — reaching out, investigating, identifying possible avenues and solutions, and acting to try to bring you some relief. Our efforts continue ... and that's no coincidence: Your ability to run your business and care for your patients is our main concern.

Best,
Doug Hoey