Associations in favor of CMS proposed rule revising Medicaid pharmacy reimbursement formula

September 21, 2010

Both the National Association of Chain Drug Stores and National Community Pharmacists Association favor the proposed rule by the Centers for Medicare & Medicaid Services (CMS) that would withdraw existing provisions of the Medicaid pharmacy reimbursement formula under the average manufacturer price (AMP) model.

Both the National Association of Chain Drug Stores (NACDS) and National Community Pharmacists Association (NCPA) favor the rule proposed by the Centers for Medicare & Medicaid Services (CMS) that would withdraw existing provisions of the Medicaid pharmacy reimbursement formula under the average manufacturer price (AMP) model.

According to a joint statement, the organizations’ leaders view the withdrawal of these provisions as a victory for patient care: “We are pleased that the Centers for Medicare & Medicaid Services (CMS) has proposed a rule that would withdraw provisions of what is known as the Medicaid average manufacturer price (AMP) rule. The proposed rule calls for the withdrawal of existing provisions that define AMP, that determine the calculation of federal upper limits, and that define ‘multiple source drug.’”

Steven C. Anderson, IOM, CAE, of NACDS and Douglas Hoey, RPh, of NCPA, reiterated that the withdrawal of these provisions is another step toward reducing what would have been major cuts to pharmacy reimbursement.

“The end result is not an increase in reimbursement to pharmacy, but rather the lessening of cuts that previously would have involved pharmacies selling most generic drugs at a loss, thereby threatening their long-term ability to provide patient care.”

The 2 leaders and their organizations insisted that the proposed policy was not appropriate. They urged policymakers to recognize the ability of pharmacies and pharmacists to help improve health and reduce healthcare costs.  

“The new law contains provisions ranging from dramatically reducing the AMP cuts to advancing medication therapy management, through which pharmacists can help patients take their medications correctly, which is referred to as ‘medication adherence.’”

According to the 2 organization leaders, costs related to poor medication adherence have been estimated to reach $290 billion annually, or 13% of all healthcare expenditures.

“We urged that patient care should not be jeopardized, but rather that pharmacy be engaged more strategically for the good of patient health and healthcare delivery,”stated the announcement issued by the associations.

The statement concluded by affirming that the organizations will continue to work with Congress and with CMS to advocate for access to pharmacy services for patients.