DIR Fees: What NCPA Wants from Part D

The National Community Pharmacists Association (NCPA) urged the Centers for Medicare & Medicaid Services to require Medicare Part D plan sponsors to justify why DIR fees cannot be reasonably estimated at point-of-sale, among other suggestions.

Direct and indirect remuneration fees have been one of the most contentious issues between retail pharmacists and PBMs and payers, which charge the “clawback” fees months after prescriptions are filled. NCPA members have said DIR fees are the top issue they would like to see resolved in 2017.

Douglas Hoey“While the proposed CMS guidance will not change existing policy with regard to DIR fees, it does have the potential to require plans to provide greater granularity to CMS on DIR amounts and the types of arrangements they put into place,” said NCPA CEO B. Douglas Hoey, RPh. “The agency has responded positively to many of our previous recommendations, and even issued an analysis showing the financial havoc retroactive pharmacy DIR fees are causing patients, taxpayers, and pharmacies. We urge CMS to consider our latest suggestions on reporting by plan sponsors.”

Related article: New Legislation Aims to Prohibit DIR Fees

In its letter to CMS, NCPA suggests that plan sponsors should detail the metrics by which pharmacies were assessed DIR fees. “CMS will learn more about the various types of DIR Fees and be better positioned to evaluate why such Medicare Part D plan sponsors concluded that the amount of such fees cannot be reasonably determined or estimated prior to the point of sale,” wrote Susan Pilch, JD, Vice President of Policy and Regulatory Affairs for NCPA.

NCPA commended CMS for its Proposed 2016 DIR Report, which modifies describing how pharmacy DIR information is collected. It makes a distinction between price concessions received from pharmacies and incentive payments paid to pharmacies by Medicare Part D plan sponsors.

“This delineation will also shed much needed light on plan sponsor/PBM pharmacy quality measures in the Part D program,” Pilch wrote. “Based on our discussions with NCPA members, as pharmacy quality programs are currently operating, they bear no resemblance to the Medicare Star Ratings system under which Part D plans are evaluated and eligible for bonus payments (MA-PD) based on performance.”

Related article: Pharmacists Pushing for DIR Relief

The report should also include an additional field or fields that would further delineate DIR amounts charged or paid to non-retail pharmacies-specifically mail order and specialty pharmacies, NCPA said. “This additional information would provide CMS with greater insight into how these fees are being applied across the Part D pharmacy marketplace.”

NCPA is working toward the end of DIR fees by urging the passage of S. 413 / H.R. 1038, the “Improving Transparency and Accuracy in Medicare Part D Drug Spending Act,” Hoey said.  “However, we’re also committed to working with CMS to provide clarity on DIR fees as they currently exist via the regulatory process.”