Push continues for short-cycle dispensing provisions

March 5, 2014

Long-term care pharmacists continued to push for support for provisions on short-cycle dispensing as the deadline for comments on the Centers for Medicare and Medicaid Service’s (CMS) proposed rule on Medicare Part D changes drew to a close on March 7.

Long-term care pharmacists continued to push for support for provisions on short-cycle dispensing as the deadline for comments on the Centers for Medicare and Medicaid Service’s (CMS) proposed rule on Medicare Part D changes drew to a close on March 7.

The Senior Care Pharmacy Alliance (SCPA) and hundreds of long-term care pharmacies re-affirmed their support for CMS’s specific proposals relating to Medicare Advantage and the Medicare Prescription Drug Benefit programs for contract year 2015. 

“We strongly support your proposed rule for additional transparency in Maximum Allowable Cost (MAC) pricing – specifically adding MACs to the definition of ‘prescription drug pricing standard’ and the resulting disclosure requirements, as well as the stipulation that Part D sponsors agree in their contracts to disclose individual drug prices to be updated to the applicable pharmacies in advance of their use for reimbursement claims,” the SCPA wrote in a letter to CMS Administrator Marilyn Tavenner last week.

SCPA agrees with CMS that there is no standardization on the criteria used to determine drugs on MAC lists or MAC prices among pharmacy benefit managers (PBMs). “We agree with pharmacy representatives who reported to CMS that ‘pharmacies are forced to sign contracts that reimburse based on MAC prices that change without notice’ and that when pharmacies do not know what they will be paid for specific drugs, they ‘cannot confirm that their reimbursements are correct nor engage in proper business planning’,” SCPA wrote.

 

SCPA also continues to urge Congressional support for the Medicare Efficient Drug Dispensing Act (S.B. 1493), introduced by Sen. Ben Cardin (D-MD) last fall. The bill seeks to preserve the $5.7 billion in budget savings estimated to result from the short-cycle dispensing policy enacted in 2010.

The goals of the short-cycle policy are endangered by the new reimbursement rules adopted by two of the largest prescription drug plan sponsors, which control nearly two-thirds of the market, according to SCPA. The PDPs switched from paying pharmacies a flat, professional fee every time they fill a script to a professional fee that is tied to the number of days’ supply of medication the pharmacy dispenses, according to a SCPA statement.

“The costs – looking up medical records and stats, consulting, filling, and sorting it for different nursing homes – are there whether we fill a one-day supply or a 30-day supply. Our net profit is very slim as it is. If you take a percent or two off of that, you are going to cut your profits by 25 to 35 percent,” Larry Galluzzo, president of Skilled Care Pharmacy in Mason, Ohio, told Drug Topics in late October.

The average cost to dispense a LTC prescription is at least $13.70, and LTC pharmacies are being reimbursed around between $4.50 and $5.00 per script on average, Galluzzo said.