/publications/issue/2006/2006-05/2006-05-5499

PHARMACIST CASH FLOW PROBLEMS CONTINUE WITH MEDICARE PART D

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A National Community Pharmacists Association (NCPA) survey revealed that serious problems still exist with the new Medicare Part D drug benefit. Concerning the 5000 independent community pharmacies polled, 93% of the respondents reported that their cash flow is worse than before the implementation of Part D.

Pharmacists need payment from insurance plans in order to pay their drug wholesalers, staff, and other expenses. Yet, the January 1 implementation, and in particular the inclusion of dual eligibles, has significantly hampered payment schedules. Medicaid used to reimburse pharmacists weekly, but Medicare Part D plans typically issue reimbursement checks only every 4 weeks and prescription claims may delay pharmacy payments by weeks.

The Medicare Part D debacle has resulted in pharmacy owners taking extraordinary steps to remain open and to continue to provide health care to Medicare beneficiaries. The survey found that 28% of independent community pharmacies have asked their wholesaler for help. The same percentage has taken out a line of credit to pay for medication inventory and payroll while waiting for the drug plans to issue reimbursement checks.

Furthermore, more than one third of the pharmacy respondents explained that, unless the Medicare Part D cash flow problem is addressed, it may jeopardize the viability of their business.