Survey: Pharmacists Say Patient Care Undermined by Auditing, Payment Practices

Published Online: Tuesday, September 18, 2012
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Alexandria, Va. - Sept. 18, 2012 Abusive auditing and unfair reimbursement practices are harming community pharmacists' ability to provide critically needed patient counseling and care to seniors, according to a new survey released today by the National Community Pharmacists Association (NCPA).

NCPA polled more than 350 community pharmacists about their recent experience with audits conducted by pharmacy benefit managers (PBMs) and other Medicare Part D plan intermediaries. The survey also asked about generic drug reimbursement caps known as maximum allowable costs (MACs). Among the findings:

  • Ninety-six percent stated that a typical PBM contract has minimal or no transparency on how generic pricing is determined or what the reimbursement rate will be.
  • Almost 50 percent of respondents said that more than 10 percent of the time, PBMs set MAC reimbursement for generics below the pharmacy's cost of simply acquiring the drug, much less dispensing and overhead costs. In addition, 92 percent said payments are not increased promptly to reflect a drug's rising market costs.
  • Three in four pharmacists (76 percent) say audit requirements across Medicare Part D plans are not consistent at all, increasing their compliance burden.
  • Nearly 87 percent stated that PBM reimbursement and auditing practices are "significantly" or "very significantly" affecting their ability to provide patient care and remain in business.

Many of the issues pharmacists touched on in the survey would be alleviated by enactment of Medicare Pharmacy Transparency and Fair Audit Act, H.R. 4215. The bipartisan legislation includes common-sense auditing standards similar to those recently enacted in over 20 states, and would disclose how MAC payment limits are set.

"Patients over paperwork; and fair reimbursement practices—that's all these pharmacists are asking for," said NCPA CEO B. Douglas Hoey, RPh, MBA in reacting to the survey. "An estimated $290 billion in costs each year are attributed to the improper use of medication. This legislation would help reduce health care costs by ensuring that local pharmacists can spend more time providing expert medication counseling and other pharmacy services to help seniors get the most out of their medication therapy. H.R. 4215 cuts the red tape, while allowing legitimate anti-fraud efforts to continue."

When asked which drugs had MAC limits set below the pharmacy's cost of acquiring the product, over 600 drugs were identified. These included common, widely used medication such as Budesonide (for Asthma); Atorvastatin (Cholesterol); Clarithromycin (Antibiotic); Fentanyl Patches (Pain); Hydrocodone (Pain/Inflammation); and Methylprednisolone (Steroid for allergic reactions, skin conditions, and breathing disorders).

"When a Medicare plan's reimbursement can't even cover the pharmacy's cost of doing business, that plan risks failing at its most basic task: To facilitate the beneficiary's ability to obtain critical prescription medication and counseling on proper use," Hoey added.

Regarding Budesonide, one pharmacist separately noted, after having collected from a patient $1,800 in wasted mail order shipments of Budesonide, "I was so distraught when they brought these in because we keep getting audited every time we send a Budesonide out the door, but yet mail order can send a patient six boxes at a time!" (PBMs often also own mail order pharmacies.)

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