NCPA Endorses Bill to Increase Transparency in Generic Prescription Drug Payments

ALEXANDRIA, Va. (Dec. 9, 2014) —

Today Reps. Doug Collins (R-Ga.) and Dave Loebsack (D-Iowa) introduced H.R. 5815, The Generic Drug Pricing Fairness Act, which creates greater transparency in how pharmacy benefit managers (PBMs) reimburse pharmacies for generic prescription drugs under Medicare Part D, the military’s TRICARE program, and the Federal Employees Health Benefits Program (FEHB). The National Community Pharmacists Association (NCPA) endorsed the bill, which goes further than legislation the same two Congressmen introduced earlier year (

H.R. 4437, The

Generic Drug Pricing Transparency Act) that has the same remedies, but only applied to Medicare Part D.

“Former Supreme Court Justice Louis Brandeis said ‘sunlight is the best disinfectant’, and Congressmen Collins and Loebsack have embraced those words of wisdom by offering a legislative remedy to how generic prescription drug pharmacy reimbursements are handled in three large federal programs,” said NCPA CEO B. Douglas Hoey, RPh, MBA. “Under this legislation community pharmacies would have basic insights into the criteria PBMs use to calculate reimbursements and experience more timely payment updates when generic price spikes occur. This proposal would allow community pharmacists to spend more time helping patients maximize their health outcomes.”

While

H.R. 5815

is being introduced as the 113^th U.S. Congress draws to a close, Reps. Collins and Loebsack have promised to re-introduce it once the 114^th U.S. Congress convenes next year. Collins and Loebsack are continuing the momentum that has been generated on this issue in recent months.

For example, on November 20^th the U.S. Senate conducted a hearing on the generic price spike issue at which numerous experts testified, including pharmacist and independent owner Rob Frankil of Sellersville Pharmacy in Sellersville, Pa., who appeared on behalf of NCPA. He went into great detail about the sudden nature of the price spikes and their impact on patients, payers and community pharmacists. Generics comprise

approximately 80 percent of drugs dispensed and price surges

of 1000% or more occur regularly and virtually overnight, yet PBMs may wait weeks or months to update reimbursement and rarely do so retroactively. As a result pharmacies, Frankil explained that pharmacies “are put in the untenable position of having to absorb the difference between the large sums of money that they spent to acquire the drugs and the lower amounts that they are paid by the PBMs.”

In response to NCPA’s concerns, in May the Centers for Medicare and Medicaid Services (CMS) issued a

final rule for Medicare Part D that brings more transparency to generic pricing and requires price updates every seven days starting in 2016. While

H.R. 5815

and H.R. 4437 would each go further than the steps taken by CMS, this acknowledgement by the federal government demonstrates the sound footing of the arguments NCPA and its allies have made for years.

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The National Community Pharmacists Association (NCPA®) represents the interests of America's community pharmacists, including the owners of nearly 23,000 independent community pharmacies. Together they represent a

n

$88.8 billion health care marketplace, dispense nearly 40% of all retail prescriptions, and employ more than 300,000 individuals, including over 62,000 pharmacists. To learn more go to

www.ncpanet.org

or read NCPA’s blog, The Dose, at

http://ncpanet.wordpress.com/

.