Published Online: Sunday, July 1, 2007

Lawmakers in a number of states have moved to soften the financial blow dealt to pharmacists by new anti?generic-reimbursement rules advanced by the Centers for Medicare & Medicaid Services (CMS). The rules effectively slash some $8.4 billion in payments to Medicaid pharmacists for generic drugs, a move that experts warn would discourage the dispensing of more cost-effective generics. According to officials at the Government Accountability Office, the CMS reimbursement cuts are so deep that pharmacists dispensing generics to Medicaid patients would be paid an average of 36% less than their acquisition costs for those drugs.

To address this problem, lawmakers in Kansas approved provisions of a new appropriations bill that restore a portion of the reimbursement cuts imposed by CMS by increasing dispensing fees paid by the state to pharmacists participating in Medicaid. Under the Kansas provision, any savings generated from the CMS cuts must be used to raise the state dispensing fee for the pharmacists who participate in Medicaid.

Similar legislation also passed the Iowa legislature with the support of that state's pharmacists association, and other states continue to grapple with the fallout from the anti-generic CMS reimbursement formulary.

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