CMS issues final rule to withdraw provisions of AMP rule currently blocked by injunction

November 12, 2010

CMS moved to withdraw provisions of the Medicaid pharmacy reimbursement formula under the AMP model, according to a statement issued by the NACDS and NCPA.

“The Centers for Medicare & Medicaid Services (CMS) move to withdraw provisions of the Medicaid pharmacy reimbursement formula under the average manufacturer (AMP) model is a victory for patients and pharmacy,” announced a statement issued by Steven C. Anderson, IOM, CAE, president and CEO of the National Association of Chain Drug Stores (NACDS) and Kathleen Jaeger, executive vice president and CEO of the National Community Pharmacists Association (NCPA).

The existing provisions that define AMP, that determine the calculation of federal upper limits (FULs), and that define a “multiple source drug” will be removed by this final rule. These provisions relate to the reimbursement to pharmacies for generic Medicaid prescriptions and can thus impact patients’ access to pharmacies, the statement said.

“When we filed the lawsuit in 2007, we knew that patient care was at stake. It is important to point out 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 and access.

“We insisted that this policy was not appropriate. Separately, we also have urged that policymakers should recognize the ability of pharmacies and pharmacists to help improve health and reduce healthcare costs. We are gratified that this sense is reflected in the pharmacy provisions of the new healthcare reform law.”

According to the statement, the new law contains provisions ranging from dramatic reduction of the AMP cuts to advances for medication therapy management, by means of which pharmacists help patients take their medications correctly. The 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,” the statement continued.

“We will continue to work with Congress and with CMS to advocate for access to pharmacy services for patients.”