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PCMA: New Study on Independent Pharmacy Reimbursements Will 'Raise Eyebrows' on Capitol Hill

Saturday, January 12, 2008 General News J E 4
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OIG Report Undermines Case for Collective Bargaining, 'Prompt Pay' Legislation



WASHINGTON, Jan. 11 /PRNewswire-USNewswire/ -- A new report released by the Office of Inspector General (OIG) on independent pharmacy payments in Medicare Part D will "raise eyebrows" on Capitol Hill and runs counter to claims from the independent drugstore lobby, the Pharmaceutical Care Management Association (PCMA) said today.



"This report will raise eyebrows among policymakers who have been led to believe that independent pharmacists were in dire straits because of the Medicare drug benefit," said PCMA President and CEO Mark Merritt. "It runs counter to rhetoric from the independent drugstore lobby on the need for costly legislation granting pharmacies special antitrust exemptions and payment cycles that are twice as fast as those received by doctors and hospitals."



Among the key findings in the report:



-- Independent pharmacies are paid an average of 18 percent more by Part D plans than their acquisition costs for medicine.

-- On average, Part D payments to rural pharmacies exceed payments to urban pharmacies.

-- Two-thirds of community pharmacies belong to group purchasing organizations that allow them to collectively bargain --- and achieve --- higher Part D reimbursement rates.



According to a separate analysis by CRA International, pharmacy antitrust exemptions would increase prescription drug costs for Medicare and commercial payors by up to 11.8 percent or $29.6 billion over five years. Legislation that would make Medicare prescription drug plans pay drugstores twice as fast as Medicare pays other providers could cost the program and its beneficiaries at least $3.1 billion over the next decade, according to a recent study from PricewaterhouseCoopers (PwC).



PCMA is the national association representing America's pharmacy benefit managers (PBMs), which administer prescription drug plans for more than 210 million Americans with health coverage provided through Fortune 500 employers, health insurance plans, labor unions, and Medicare Part D.



SOURCE Pharmaceutical Care Management Association
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