Pharmacy groups back CMS rejecting below-cost dispensing fees in Washington

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Pharmacy groups back CMS rejecting below-cost dispensing fees in Washington

By Sandra Levy - 03/19/2019
The National Association of Chain Drug Stores, the Washington State Pharmacy Association, and the National Community Pharmacists Association filed a legal brief last week in support of a recent move by the Center for Medicare and Medicaid Services.  The agency rejected the state of Washington’s below-cost reimbursement of community pharmacies servicing Medicaid patients, saying it was inconsistent with federal Medicaid rules. That decision is under review at the request of Washington.

In 2016, CMS put in place a new rule changing how states must reimburse pharmacies. A key part of the rule indicates that states must reimburse pharmacies for their actual costs in dispensing drugs to Medicaid beneficiaries.

The legal brief asserts that Washington State has failed to comply with that rule, maintaining its below-cost dispensing fees. Since CMS released the rule, the “vast majority of states have adopted” cost-based dispensing fees, but Washington State has refused to do the same, maintaining the same below-cost dispensing fees—lower than any state in the country—which may impede patient access to care, the groups said.

Contrary to federal rules, Washington has said that it does not need to “consider a pharmacy’s actual costs in determining dispensing fees.”

The groups state in the brief that after more than three years of trying to work with Washington State, CMS should require the State to adopt cost-based dispensing fees and that such fees must be made effective April 1, 2017, according to regulation.

In June 2018, NACDS, NCPA, and WSPA sent a letter to CMS asking the agency to “delay no longer in requiring Washington to comply with federal Medicaid reimbursement law like other states.” The organizations filed a brief that same month with the Washington State Court of Appeals that described their position.

In March 2017, NACDS, WSPA, and NCPA sued the State of Washington to stop a “substantively and procedurally flawed” rule that would pay community pharmacies below the actual cost to dispense Medicaid prescriptions.

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