PBM audits, MACs place pharmacies at risk, say survey respondents

August 8, 2011

As pharmacy groups protest the massive pharmacy benefit manager (PBM) merger of Express Scripts and Medco Health Solutions, a new survey demonstrates the impact of PBMs on pharmacy businesses.

As pharmacy groups protest the massive pharmacy benefit manager (PBM) merger of Express Scripts and Medco Health Solutions, a new survey demonstrates the impact of PBMs on pharmacy businesses.

In early August, the National Association of Chain Drug Stores (NACDS) and the National Community Pharmacists Association (NCPA) opposed the merger in a letter to the Federal Trade Commission. “This combination will control a large share of the supply line for brand and generic prescription drugs, and thereby will have the ability to raise prices to plans and patients, and limit access to pharmacy patient care,” the 2 groups wrote.

Meanwhile, NCPA’s new survey of 1,850 members found that PBM audits and maximum allowable costs (MACs) - generic drug reimbursement limits - are significantly hampering pharmacists’ businesses. For example, when pharmacists were asked how PBM reimbursement and auditing practices affect pharmacists’ ability to provide patient care and remain in business, 97% said it was a “significant” or “very significant” factor.

Record-keeping requirements demanded by PBMs go beyond state and federal laws, and incidents of noncompliance are “harshly penalized” by commission-driven auditors, according to 98% of responders.

In addition, 62% consider audit requirements to be inconsistent from 1 health plan to another. Among respondents, 71% tried to use PBM appeals processes when they believed that the MACs did not accurately reflect the costs to their pharmacies.

“Many pharmacists complained about the one-sided nature of the appeals process and noted that MAC-based reimbursement can take months to increase after drug costs spike (and is virtually never done retroactively),” NCPA said in a statement.

“Ostensibly, pharmacies are audited to guard against fraud, whereas payment caps are established to ensure appropriate reimbursement for generic drugs. However, this survey indicates that both have gone well beyond their intended purpose, while padding windfall PBM profits,” said Douglas Hoey, executive vice president and CEO of NCPA.