Published Online: Thursday, March 1, 2007

Medicaid and other government health care programs are grossly underpaying community pharmacists for the cost of dispensing prescription medications, according to the results of a new study by researchers at Grant Thornton.

Although Medicaid pays pharmacists an average dispensing fee of about $4.50 per prescription, the actual cost to US pharmacies of dispensing medication is more than double that amount. The average is $10.50 per Rx nationwide, according to the study findings issued by the Coalition for Community Pharmacy Action (CCPA).

The Grant Thornton study, which reflects data from >23,000 community pharmacies nationwide, "is the first of its kind, encompassing all factors related to the cost of dispensing medication, in more than 14 years," said the CCPA. The researchers uncovered significant variations from one state to another in the average cost of dispensing prescription drugs.

Average pharmacy dispensing costs are now a whopping $13.08 per Rx in California, and the figures are even higher in some mountain states, the study found.

Even in Rhode Island—the state where dispensing costs are the lowest in the nation at $8.50 per Rx—pharmacists are being underpaid by Medicaid and other government drug programs by nearly half.

"As a result of low reimbursement rates, many pharmacies will have trouble keeping their doors open or will be forced to reduce the number of pharmacists or pharmacy hours," said Charles Sewell, copresident of the CCPA.

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