Lawmakers Urge at Least a One-Year Transition Period on Implementation of Medicaid Reimbursement

NACDS expresses support for congressional letters requesting more time for states to implement average manufacturer price-based federal upper limits.


Arlington, Va.

— Last week, 64 members of the U.S. Senate and U.S. House urged Health and Human Services Secretary Sylvia Mathews Burwell to adopt at least a one-year transition period for states to implement the April 2015 average manufacturer price (AMP) based federal upper limits (FULs). The National Association of Chain Drug Stores (NACDS) commended Sens. Johnny Isakson (R-GA) and Mark Warner (D-VA) and Reps. Chris Collins (R-NY) and Rep. Dave Loebsack (D-IA) for leading the letter effort with their colleagues.

In the letter from the Senate, the Senators urge the Centers for Medicare & Medicaid Services (CMS) to help preserve access to much-needed prescription medications for Medicaid patients by supporting “proper and accurate reimbursement for retail community pharmacies that dispense prescription drugs to Medicaid beneficiaries, and ensuring that state Medicaid programs have sufficient time to implement federal regulatory changes.”

In June 2014, CMS announced a delayed in the implementation of AMP-based FULs. In November 2014, CMS stated that at the same time the “Final Rule on Medicaid Covered Outpatient Drugs” is released - which is expected in the near future - CMS intends to finalize the new FULs and guidance to states for implementing those FULs.

In light of CMS’ upcoming regulatory action, the lawmakers emphasized the need for at least a one-year transition period to help states meet the requirements of the final rule in their letter.

“States need time to pass drug reimbursement changes through their legislatures, particularly in light of the fact that a number of state legislatures end their sessions in spring or early summer every year. States will also need sufficient time to conduct cost-of-dispensing studies to allow for the calculation of fair pharmacy reimbursement, as well as time needed to file State Plan Amendments to make adjustments in light of the new FULs,” the House letter stated.

The letters also cite the importance for CMS to engage with retail community pharmacies and other stakeholders so that enrollees’ access to the medications they need may not be disrupted.

NACDS President and CEO Steven C. Anderson, IOM, CAE expressed appreciation to lawmakers in signing these letters, “The implementation of these AMP-based FULs poses great concern for pharmacy patient care. And we appreciate the recognition by U.S. Senators and Representatives of the need for an adequate transition period so that states have an opportunity to make an effective transition to help preserve access to pharmacy services for low-income Americans.”

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