First, the largest impediment to independent community pharmacies continuing to serve the needs of their patients and maintaining their businesses is the bureaucratic morass they must wade through and the questionable business practices of often unregulated pharmacy benefit managers (PBMs). These multi-billion dollar PBMs are the middlemen hired by a health insurance plan (employer, Medicare, Medicaid, union) to process claims and to negotiate prices with drug manufacturers.
Independent community pharmacists are entrepreneurs and unafraid of fair competition. But greater oversight and legislative remedies are badly needed for the PBM industry, which can financially coerce patients into using PBM-owned mail order pharmacies; obscure the fiscal details needed by those (employers, Medicare, et. al) who hired them to judge their performance; and perform egregious audits that financially penalize pharmacists even when the right drug is dispensed to the right patient, at the right time and cost, and as prescribed by a physician.
Medicare officials recently acknowledged abusive pharmacy audits as a growing concern, saying, “[R]etrospective audits of previous years’ claims are resulting, in some cases, in complete recoupment of the amount originally paid to the pharmacy when non-financial data on the claim transaction, such as prescription origin codes or prescriber identifiers, are determined to be erroneous. The increasing incidence of these adjustments for ‘routine clerical errors’ rather than incorrect payment amounts (financial errors) may be related to the incentives in contingency reimbursement arrangements with claim audit vendors. We are concerned that the growing practice of post-audit total claim recoupments from pharmacies is distorting Part D payment, as well as compromising Part D data integrity and impairing our ability to oversee the program.”
One might say that’s all well and good so long as health care costs are being reduced. But they’re not. Drug costs continue to rise faster than inflation, health premiums are higher, co-pays are up, all while pharmacies are paid less and less, threatening their viability. Where’s the money going? Hint: the largest PBM, Express Scripts, recently announced a 74 percent increase in earnings.
Many of these issues were covered by legislation that was introduced in the last Congress, but it failed to progress. An NCPA priority this year is to have such legislation reintroduced that would address PBMs’ lack of timely generic drug pricing updates and fair pharmacy audit standards.
A second priority is to have pharmacists officially recognized as health care providers by Medicare and Medicaid. They are not now designated as such under the Social Security Act (SSA) and what once might have been considered an oversight or status slight now is preventing pharmacists from expanding their roles as the health care system moves to embrace coordinated patient care models such as accountable care organizations and medical homes. Under these new models doctors and hospitals voluntarily join forces to improve quality, rein in costs and share the money saved if they achieve better health outcomes. In addition, if properly utilized, pharmacists have the expertise and training to help alleviate the worsening primary care shortage.
Because of the lack of official status some of these organizations are reluctant to bring pharmacists on board, where they could, for example, more fully address the $290 billion a year problem of patients not taking their prescribed medications, which often results in costly hospitalizations.
Another priority involves Medicare diabetes patients. Congressional action and federal policy are forcing senior citizens to have their blood glucose testing supplies delivered by mail and forcing pharmacies to end personal deliveries of them in their homes and assisted living facilities.
Personal interaction with long-time, trusted pharmacists is critical to ensuring that diabetes patients take and medications and self-test regularly. The fiscal cliff deal will reduce testing supply reimbursement rates by about 13% on April 1 and by nearly an additional 70% when the national mail order program kicks in and also when personal home deliveries by local pharmacists are banned. Legislation that would allow small pharmacies to continue providing these products and services to Medicare patients attracted bipartisan support in the last Congress and we believe it should be reintroduced soon.
Although there are many other issues affecting the ability of patients to access their medications and have a choice in their pharmacist, we believe these legislative priorities have the greatest potential to benefit patients and the pharmacists who serve them.
Hoey is CEO of the National Community Pharmacists Association (NCPA).