DIR Fees: Just One of Many Reimbursement Battles

April 17, 2018
Jason Poquette, RPh
Jason Poquette, RPh

Jason Poquette is the director for outpatient pharmacy services at Saint Vincent Hospital in Worcester, Mass., and an APPE preceptor for the Massachusetts College of Pharmacy. Contact him at Jason.pharmacist@gmail.com.

Reimbursement issues, sadly, aren’t anything new for pharmacies.

Everyone is talking about DIR fees these days. And rightly so. They are an embarrassment to our profession and arguably the most unethical “legal” reimbursement tactic going on in healthcare today.

According to a recent survey by NCPA, eliminating DIR fees should be the #1 priority of the organization in 2018. This is because the proliferation of these fees is likely to deliver a fatal blow to many pharmacy businesses. “84 percent said DIR fees hinder their ability to plan for the future of their business,” according to the survey.

For those uncertain about what a DIR fee is, there are no shortage of articles you can read to get up to speed. But don’t get your hopes up about becoming an expert. They are a convoluted collection of ways for PBM’s to ultimately reduce the anticipated reimbursement that pharmacies expect to receive.

They are loosely based on performance metrics, some of which are outside the pharmacy control. The result is that many pharmacies can do little more than hope and pray the check they get will be enough to keep them afloat a little longer. No business can run this way for long.

But while we are right to pay attention to DIR and how they represent a threat to both patients and pharmacies, I have to remind readers and pharmacists that reimbursement struggles have been par for the course in our profession. Because we have almost always provided both a product and a service, we have always had to deal with tightening reimbursement on the medication, which limits our capacity to provide necessary services like counseling and DUR. We’re used to the battle.

Relate article: Removing DIR Fees Could Save Billions

For example, pharmacies have faced financial challenges when their patients are shuffled off into mail-order networks against their will. Pharmacies have had to (and still do) deal with MAC pricing and under-reimbursement, especially when acquisition costs rise sharply. Pharmacies can be locked out of networks they would willingly participate in if allowed. The pharma industry can limit the drugs some pharmacies have access to dispense, or a PBM can exclude the pharmacy from dispensing it. Pharmacies can be audited and fined for minor, innocent issues on prescription records which can cost their business thousands of dollars. The list goes on and on.

And so, just as we have found a way to face and overcome many of these other challenges, I’m convinced we will deal with this insidious DIR issue as well.

The CMS statement issued recently has given a glimmer of hope to those who want to see DIR die. According to NCPA’s CEO B. Douglas Hoey, “in this rule, CMS hints strongly that it is concerned about retroactive pharmacy DIR, [and] that it has statutory authority to address the issue.”

The DIR problem is a big one, but we’re no strangers to the reimbursement battle. My advice to my fellow soldiers is simply this: never give up!