House Weighs Options To Head Off Pharmacy Reimbursement Cut
House Ways and Means Committee Chair Charles Rangel (D-N.Y.) and House Energy and Commerce Health Subcommittee Chair Frank Pallone (D-N.J.) on Tuesday at a conference of the National Community Pharmacists Association said that they might not be able to stop the enactment of a Medicaid regulation that pharmacists say will be "disastrous" to their revenues, CQ HealthBeat reports (Reichard, CQ HealthBeat, 5/15).
The rule, mandated under the 2005 Deficit Reduction Act, would save Medicaid an estimated $8.4 billion over five years. Under the rule, the formula that CMS uses to calculate Medicaid reimbursements for generic medications for the first time would include an "average manufacturer price" that accounts for mail-order prices and rebates to pharmacy benefit managers. However, retail and independent pharmacies, where most Medicaid beneficiaries purchase their medications, do not receive such rebates and discounts.
According to a report from the Government Accountability Office, the rule would reduce Medicaid reimbursements to levels that would not cover the cost of many generic medications or the cost to dispense the treatments (California Healthline, 3/28).
Rangel and Pallone said they might introduce legislation later this year that would nullify the Medicaid regulation, possibly by altering the calculation of AMPs.
Pallone said in the Tuesday speech that he would hold a hearing on the issue and that he would consider blocking the reimbursement cuts through language added to "must-pass" legislation sometime this summer, such as the State Children's health Insurance Program or Prescription Drug User Fee Act reauthorizations (CQ HealthBeat, 5/15).
Pallone said he and House Energy and Commerce Committee Chair John Dingell (D-Mich.) are waiting for a response from HHS Secretary Mike Leavitt, to whom they wrote a letter last month requesting an explanation of the policy.
Also at the conference, Rep. Nancy Boyda (D-Kan.) noted that House members have written to CMS requesting a delay on the implementation of the new payment policy (Edney, CongressDaily, 5/15).