NACDS reacts with cautious support for Senate health reform framework

ALEXANDRIA, Va. A broad framework for health reform proposals unveiled by the Senate Finance Committee this week met with guarded praise from the nation’s top chain pharmacy lobbying group.

National Association of Chain Drug Stores president and CEO Steve Anderson expressed support today for several healthcare bills advancing in the House and Senate, but said his group still has deep reservations about Medicaid pharmacy reimbursement provisions in the legislation.

“As the healthcare reform debate has developed, NACDS is encouraged that provisions related to three specific pharmacy topics are included in bills currently under consideration in Congress,” Anderson stated.

In particular, he said, chain pharmacy leaders support enhancement of community pharmacist-provided medication therapy management; reform of the Medicaid pharmacy reimbursement system to maintain patient access to community pharmacy services; and ensuring patient access to durable medical equipment such as diabetic testing supplies through community pharmacies.

“Regarding the Senate Finance Committee framework document released this week, we appreciate that inclusion of a provision to reform Medicaid pharmacy reimbursement remains a priority,” added NACDS’ top manager. “However…we remain extremely concerned that an insufficient ‘multiplier’ for establishing federal upper payment limits [FULs] for generic drugs could have extremely negative consequences for pharmacies and their low income patients.”

The “multiplier,” which sets the rate at which pharmacies would be reimbursed by Medicaid for dispensing generic drugs to low-income patients, is proposed in the Senate Finance Committee framework to be 175% of the weighted average of the drug’s acquisition cost as defined by its average manufacturer price, or AMP. By contrast, at least two members of Congress who often support pharmacy’s interests, Reps. Marion Berry, D-Ark., and Kansas Republican Jerry Moran, have proposed a multiplier of as high as 300% of AMP.

The lower reimbursement formula, said Anderson, could have the effect of “possibly jeopardizing access to patient care in pharmacies, and undermining incentives to dispense generic medications, which are so critical to reducing prescription drug expenditures.

“From this perspective, NACDS has questions about the 175% multiplier described in the Committee framework, and look[s] forward to continued discussions with congressional committees on this specific issue,” noted Anderson. “That being said, NACDS strongly commends the framework’s adoption of a ‘weighted average’ AMP rather than the lowest AMP to set FULs, as was the case under the Deficit Reduction Act of 2005,” he continued. “The use of a weighted average AMP would deliver a much needed improvement that takes into account the wide range of market prices for generic drugs.”

In addition, Anderson urged the Senate panel to air a more complete definition of AMP, “as it is essential that this definition only takes into consideration drug sales related to the retail class of trade, to prevent the inappropriate skewing of this model.

“In summary, NACDS applauds the maintenance of key pharmacy provisions that are essential to patient care among the priority items on the healthcare reform agenda. We look forward to remaining a good-faith partner in the ongoing healthcare reform debate, for the ultimate good of the American public,” Anderson said.