NCPA advocates for PBM audit reform, greater transparency

May 7, 2013

Leaders of the National Community Pharmacists Association (NCPA) and hundreds of its members were in Washington, DC, last week for a two-day advocacy-focused conference. They hope to garner support from Congress for leveling the playing field between pharmacy benefit managers (PBM) and independent community pharmacies.

 

Leaders of the National Community Pharmacists Association (NCPA) and hundreds of its members were in Washington, DC, last week for a two-day advocacy-focused conference. They hope to garner support from Congress for leveling the playing field between pharmacy benefit managers (PBM) and independent community pharmacies.

NCPA continues to push its agenda for fairer PBM audits and greater PBM transparency. The association announced that it supports the new S.B. 867, Medicare Prescription Drug Program Integrity and Transparency Act, introduced by Senators Mark Pryor (D-AR) and Jerry Moran (R-KS) on May 6. This bill will address PBM standards for basic pharmacy audits, further transparency of payment methodology to pharmacies, and recoupment of funds to Medicare.

NCPA believes that Medicare Part D audits are necessary to detect fraud and abuse, but the process should be fair, explained NCPA CEO B. Douglas Hoey, RPh, MBA, during a media call.

“We believe that fraud and abuse are very rare. With any providers in the Part D and Part B program, there should be some checks and balances. However, we believe there should be a fair process and we believe that PBMs are abusing that process by singling out expensive drugs and using typographical and other trivial errors to recoup from pharmacies significant amounts that aren’t always returned to the Medicare program,” Hoey said.

“What we are striving for is an appropriate balance in the business relationship between PBMs and pharmacies. Right now the balance of power is tilted heavily to the PBMs and these relationships don’t constitute a traditional business relationship,” Hoey said.

NCPA also advocates for transparency in maximum allowable costs (MAC)-the payment for generic drugs. “The contracts that pharmacies receive from PBMs are non-negotiable and PBMs don’t disclose the terms and conditions for payments of generic drugs. The MACs are not updated frequently to reflect generic drug price spikes,” Hoey continued.

Hugh Chancy, RPh, owner of Chancy Drugs in south Georgia, noted the struggle faced by independent pharmacists to stay in business, specifically due to PBM audit practices.

“The PBMs have a strong arm against us in many ways,” said Chancy.

He explained that specific PBM practices have made it possible to recoup drug payments to pharmacies by requiring the time a drug was called in to the pharmacy and for disputes over patient signatures for the medication. The appeals process with a PBM can be cumbersome, Chancy noted.

In addition, he supports MAC pricing lists that are fair and updated regularly, so pharmacies are reimbursed in a timely fashion.