Competitive bidding to hurt independents

Beyond 2013, competitive bidding around durable medical equipment supplies could push many pharmacy operations out of the diabetes business altogether. “By 2016, all durable medical equipment suppliers, mail-order and retail, will be subject to competitive bidding or competitive bidding pricing for [diabetes testing supplies],” noted the NCPA in recent written testimony to Congress. According to an NCPA poll, that could drive as many as 92% of independents out of the 
diabetes business. 


NCPA has been lobbying for passage of the Medicare Access to Diabetes Supplies Act, a bipartisan bill that would exempt small pharmacy operations of less than 10 locations from competitive 
bidding restrictions. 


Sales of lancets and devices across food, drug and mass (excluding Walmart) totaled $17.2 million for the 52 weeks ended Aug. 12, up 3.1%, according to SymphonyIRI group data. But that is a far cry from representing the total value of a diabetes patient. People with diagnosed diabetes, on average, have medical expenditures that are approximately 2.3 times higher than the expenditures would be in the absence of diabetes, according to the American Diabetes Association. More than half of diabetes patients utilizing Medicare visit their neighborhood pharmacies as many as three times each month, according to an NCPA poll. 


Then there are ancillary conditions for which diabetics may seek treatment. According to the Centers for Disease Control and Prevention, 19.9% of U.S. adults with diabetes smoked in 2010; 56.9% were obese, based on self-reported height and weight; 85.7% were overweight or obese; and 36.1% reported being physically inactive. In 2009, 57.9% of U.S. adults with diabetes reported having hypertension, and 58.4% reported that their cholesterol was high.


The article above is part of the DSN Category Review Series. For the complete Diabetes Buy-In Report, including extensive charts, data and more analysis, click here.