R.Ph.s to Senate: Don't cut patient access to Medicaid

November 7, 2005

Concerned about the potential impact that Medicaid budget cuts will have on health care, the National Association of Chain Drug Stores and the National Community Pharmacists Association have formed the Coalition for Meaningful Medicaid Reform (CMMR).

Concerned about the potential impact that Medicaid budget cuts will have on health care, the National Association of Chain Drug Stores and the National Community Pharmacists Association have formed the Coalition for Meaningful Medicaid Reform (CMMR).

Emphasizing that the approach Congress is taking on Medicaid reform is going to put prescription drug access in jeopardy for millions of Medicaid beneficiaries, Fuller said, "With the Senate indicating they were going to review the reconciliation bill this week, it was important to raise our concerns in a more public fashion. January 2007 is when Congress envisions the Medicaid reform program taking effect, so we don't think it is prudent to rush the bill through in the next few weeks."

When queried about reimbursement issues related to average manufacturers price (AMP), Fuller said, "Congress recognized that if you are going to go to AMP, you are going to have to modify it in some way."

One of the modifications is excluding from AMP certain discounts to which community pharmacy has no access. "On brand drugs, I think they are probably modifying it closer to wholesale acquisition cost [WAC], which is what we actually proposed," said Fuller. "On the brand side, we are a little bit closer to where we would need to be. But half of the drugs dispensed today, on average, are generic drugs. The only place where there is really going to be cost reduction and opportunity is in driving up the use of generics," he said.

Fuller said that if Congress wants to reduce what it pays pharmacies for product acquisition, the coalition wouldn't argue, provided there is a fee paid to cover the cost of dispensing.

But neither the Senate nor the House wants to do that, Fuller said. "They want to leave that to the states. We are caught in a half-baked solution, which is really not any solution because it holds down the reimbursement on the product side and it's mute with respect to reimbursement on the professional fee side, except to say the states must go through a process to set a fee. That is going to endanger the program, because it runs the risk of leaving independent pharmacies with a calculation that may not allow them to participate in the program at all."

Finally, Fuller concluded that the coalition would like to see Congress go back to the drawing board and work on Medicaid Rx drug payment reform and operate without passing a budget until well into next year.

In the meantime, CMMR has hand-delivered to every U.S. senator a letter calling for the need for greater transparency in how Medicaid pays for Rxs, utilization of market-based solutions that would maintain a competitive process, and a fee for professional services provided to Medicaid patients.

For more information on CMMR, visit http://Meaningfulmedicaidreform.org/.