NCPA: Community Pharmacists Help Cut Medicaid Costs

Kate H. Gamble, Senior Editor
Published Online: Friday, June 24, 2011
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The National Community Pharmacist Association has gone on the offensive in response to a new ad campaign.

In an ad launched last week, the Pharmaceutical Care Management Association (PCMA) made a case to state policymakers to cut “overpayments to independent drugstores” and transition “to a more efficient and affordable pharmacy benefit model.”

According to a report from the Lewin Group, states and the federal government could save $33 billion over the next decade by "modernizing pharmacy benefits to be more like those in Medicare and commercial plans.”

In a statement, PCMA President and CEO Mark Merritt said, “Taxpayers shouldn't pay more for Medicaid drug benefits than Fortune 500 companies and Medicare. Currently, the program uses fewer generic drugs and pays drugstores more than double the fees that Medicare or private insurers pay."

In response to the statement, the Douglas Hoey, RPh, MBA, executive vice president and CEO of the National Community Pharmacists Association (NCPA), made a case for local pharmacists, arguing that they can, in fact, help reduce Medicaid costs.

"Community pharmacists are the backbone of the Medicaid drug benefit and reduce costs by helping millions of patients properly take their medication. Independent community pharmacies, in particular, are critical providers to the underserved rural and urban areas where many Medicaid recipients live, and may be the only accessible pharmacy,” said Hoey. “Local pharmacists provide expert medication counseling, which can help reduce the estimated $290 billion spent annually on improper prescription drug use. In addition, community pharmacists are a leading provider of low-cost generic drugs and consistently dispense them more often than PBM-owned mail order pharmacies. According to IMS Health, for every two percent increase in generic utilization, Medicaid costs can be reduced by $1 billion. The Massachusetts fee-for-service Medicaid program has a generic dispensing rate of 79.3 percent, a rate which could save $5.14 billion if achieved nationally.

"Further, new questions continue to surface concerning for-profit Medicaid managed care. Georgetown University concluded that a Medicaid managed care program in Florida significantly disrupted patients and the quality of care without providing any clear cost savings. And, just this week, the non-partisan Commonwealth Fund warned that for-profit, publicly traded managed care companies, like the major PBMs, charge states and taxpayers more for administrative costs than alternative models. Indeed, in recent years, the major PBMs have paid out $370 million to settle charges of fraud and deceptive practices, including in Medicaid, as their profits increased 400 percent.
"Patients and policymakers should continue to work with trusted, highly trained community pharmacists to improve health and lower costs, and think twice about out-of-state, corporate entities that may quite simply be in it for the money.”

To read the NCPA statement, click here.

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