NACDS Addresses DIR Reform in Statement


Pharmacy DIR fees increasingly are being misused by payers to retroactively claw back reimbursement to pharmacies for the prescription drugs that they provide to Medicare beneficiaries.

Officials with The National Association of Chain Drug Stores (NACDS) this week submitted a statement to the US House of Representatives Committee on Ways and Means that addresses the importance of direct and indirect remuneration (DIR) fee reform for reducing patients’ out-of-pocket prescription drug costs, and for pharmacies’ viability.

The comments also describe the relationship between lower out-of-pocket drug costs and better medication adherence.

Earlier this year, NACDS submitted comments to the Centers for Medicare & Medicaid Services (CMS) in support of the agency’s DIR fee reform proposal described in the proposed rule, Modernizing Part D and Medicare Advantage to Lower Prices and Reduce Out-of-Pocket Expenses.”

In its statement to the Committee NACDS officials noted: “CMS should use their authority to include pharmacy DIR fee reform and the movement toward a pharmacy quality incentive program in the final rule. These changes will lower out-of-pockets costs for beneficiaries and make medicine more accessible, leading to greater adherence and better health outcomes through services such as medication optimization. We urge members of the Committee to voice their concerns to Secretary of Health and Human Services and urge the inclusion of these changes in the Final Part D Rule.”

Pharmacy DIR fees increasingly are being misused by payers to retroactively claw back reimbursement to pharmacies for the prescription drugs that they provide to Medicare beneficiaries. For example, payers impose penalties for pharmacies’ alleged failure to achieve certain benchmarks—many of which, according to a statement from NACDS officials, "are vague, undefined, inconsistent, unachievable or outside of the control of pharmacies."

Interpretations of specific terms that are used in the Medicare program related to pharmacy reimbursement and drug pricing have led to these clawbacks, and ultimately to higher out-of-pocket drug costs for patients and increased costs for the government. In its comments, NACDS officials noted the significant trust placed in pharmacies, including on topics related to prescription drug savings.

“Based on their first-hand experiences with pharmacies and pharmacists, Americans also trust the recommendations of pharmacies and pharmacists on related public policy issues,” NACDS officials wrote. A national poll of registered voters conducted January 4-6, 2019, by Morning Consult and commissioned by NACDS noted that 69% of registered voters say pharmacists are credible information sources on prescription drug savings, making pharmacists the highest-ranked health care professionals in this regard. Further, 86% of registered voters support pharmacists using their expertise to identify policies that will lower patients’ drug costs and that build on the Know the Lowest Price Act.


NACDS Urges DIR Fee Reform in Statement to House Ways and Means Committee [news release]. NACDS website. Accessed Feb. 13, 2019.

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