Community Pharmacies Raise Concerns About Medicaid Rule
Community pharmacists and others are concerned about a rule finalized last month by CMS that will reduce Medicaid reimbursements to pharmacies for generic medications, the Miami Herald reports(Hotakainen, Miami Herald, 8/7).
The rule, mandated by the Deficit Reduction Act of 2005 and scheduled to take effect on Dec. 30, seeks to ensure that Medicaid can obtain prescription drug discounts similar to those obtained by private entities. The rule will redefine the average manufacturer price for brand-name and generic medications. States use AMPs to calculate Medicaid reimbursement rates for medications. Under the rule, the federal government will post AMPs on a Web site that consumers could access.
In addition, the rule will limit the federal share of the cost of brand-name medications when at least three generic versions are available. The rule will exclude pharmacy benefit managers and pharmacies in nursing homes and assisted living facilities.
According to CMS, the rule will save the federal government and states $8.4 billion over the next five years (California Healthline, 7/10).
Community pharmacies, which maintain that they will account for 90% of reductions in Medicaid reimbursements, have raised concerns that the rule will require more of them to close their businesses.
In addition, critics maintain that, under the rule, Medicaid will reimburse pharmacists at an average rate of 36% less than their costs. Critics also maintain that, as a result of the rule, many pharmacies will decide to end participation in Medicaid, with many beneficiaries "denied life-saving drugs or forced to drive long distances to get them," the Herald reports.
However, CMS spokesperson Mary Kahn said, "We don't agree ... that the new rule will put pharmacies out of business." She added that states "were greatly overpaying for many drugs, especially generic drugs" (Miami Herald, 8/7).