CMS Might Adjust Pharmacist Payments To Address Concerns About Medicare Drug Benefit

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Pharmacy / Pharmacist
Article Date: 16 Mar 2006 - 5:00 PDT

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CMS Administrator Mark McClellan said his agency is aware that many pharmacists are experiencing financial problems because of slow reimbursements from drug plans under the Medicare prescription drug benefit but added that pharmacists' payment issues are not entirely the result of the new program, the AP/Contra Costa Times reports. "I think what we're seeing is a change in the business model that continues a trend that has occurred over the past 15 years," McClellan said. He said CMS is considering increases in reimbursements for pharmacists who help patients switch from brand-name drugs to generic medications. "This does require some changes in business practices, so we're looking at ways that we can support pharmacists who want to succeed in this new kind of environment," he added. McClellan's comments come after reports that many pharmacists are losing money under the drug benefit because of delays in reimbursements from insurers for drugs prescribed to dual eligibles, beneficiaries who are enrolled in both Medicare and Medicaid. Karen Ignagni, president and CEO of America's Health Insurance Plans, said the delays in reimbursements occurred after Medicare drug plans received incorrect enrollment information on dual eligibles from CMS. The financial impact of the reimbursement delays has been most apparent for independent community pharmacies, which have smaller cash reserves than chain drug stores, the AP/Times reports. Nationwide, there are about 25,000 independent pharmacies employing about 60,000 pharmacists (Freking, AP/Contra Costa Times, 3/14).

Proposed Changes
CMS will hold a public meeting on April 24 to hear comments about the proposed payment incentives for pharmacists who prescribe generics, CMS spokesperson Peter Ashkenaz said on Monday. CMS also is considering billing and coding changes to reduce costs related to filing Medicare claims, Ashkenaz said. He added that the proposals predate a meeting last week between a group of Texas pharmacists and White House officials in which the group expressed concerns that some pharmacies would be forced to close because of financial troubles under the drug benefit. Ashkenaz reiterated CMS' position that the problems for independent pharmacists began before the drug benefit, adding that the program is bringing them more business. In addition, he said that state Medicaid programs appeared to have been overpaying pharmacists for drug claims, which is why payments from insurers under the drug benefit are lower than payments pharmacists previously received for dual eligibles (Reichard, CQ HealthBeat, 3/13).

AHIP Surveys
In other Medicare news, eight in 10 beneficiaries who voluntarily enrolled in the drug benefit say they have experienced no problems with it, and six in 10 say the benefit is helping them save money on prescription drugs, according to a survey released on Monday by AHIP, CQ HealthBeat reports. In addition, a second AHIP survey shows that nine in 10 dual eligibles say they have experienced no problems with the drug benefit. Whitfield Ayres, a Republican consultant and president of Ayres, McHenry & Associates, which conducted the poll, said, "This is a dramatic departure from the conventional wisdom about this program." Ignagni said, "What seniors are saying here is this program is working for them." Ron Pollack, president of Families USA, said "[T]his is a really political survey, obviously undertaken by a Republican polling firm, and it is designed to make it appear like everything is rosy and anybody who is critical has some ulterior motive that is hurting the program rather than the design of the program being flawed." Robert Hayes, president of the Medicare Rights Center, said, "I can think of a few less trusted sources of honest data than the HMO industry" (Carey, CQ HealthBeat, 3/13).

The first and second surveys are available online. Note: You must have Adobe Acrobat Reader to view the surveys.

Additional Coverage
CBS' "Evening News" on Monday reported on pharmacists' concerns about the Medicare prescription drug benefit. The segment includes comments from Bob Lomenick, owner of Tyson Drug Store, and Mark Merritt, president of the Pharmaceutical Care Management Association (Acosta, "Evening News," CBS, 3/13). The complete segment is available online in RealPlayer.

In addition, McClellan is scheduled to answer questions in an "Ask the White House" online chat about Medicare and the prescription drug benefit on Wednesday at 4 pm. A transcript will be available online after the chat.

"Reprinted with permission from http://www.kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at http://www.kaisernetwork.org/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation . © 2005 Advisory Board Company and Kaiser Family Foundation. All rights reserved.

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