Thursday, December 31, 2009

HR 3590 and the AMP fix (even more exciting subject matter)

Just a quick note on the supposed "fix" to the Average Manufacturer Price calculations and its impact on the economics of pharmacy.

HR 3590 establishes that the Federal Upper Limit (FUL) shall be no less than 175 percent of the weighted AMP for purposes of medication reimbursement calculations. I've already commented on the problems with the weighted AMP in a previous post.

Does defining the FUL really do anything for pharmacy?

I've looked at the contracts before. I've never seen FUL mentioned in the calculations for reimbursement. All I've ever seen are:
  • Federal MAC
  • WAC
  • AWP minus
  • GEAP
  • Insurer's MAC

All of these *plus* a dispensing fee of $1.75-3.75.

As I see it, this fix does nothing. The insurers are going to continue to reimburse us with the existing formulas and we are going to continue to bleed each and every time we dispense a prescription. With more people supposedly getting coverage through government funded plans, we will see an increased number of opportunities to bleed.

If HR 3590 really wanted to address pricing issues, it would specify which reimbursement formulas that the insurers must use for government funded health plans. Tack on a realistic dispensing fee and maybe we have something.

This concludes today's post.

Tuesday, December 29, 2009

Two page health care bill

The whole health care debate has focused on getting health care for the uninsured. In an effort to address this, the Congress of the United States has passed a bill that is over 2000 pages long that still doesn't cover everybody.

It covers more, but not all.

If you really want to ensure access to health care, let providers deduct charitable care on their taxes. Maybe at rates that are a percentage of the established Medicare/Medicaid rates for the services.

Think about it, right now Joe goes to the ER with the sniffles. He gets triaged and sent back to a room. The ER doctor sees him and writes out a script for amoxicillin. Joe goes to pharmacy to fill script. Complains to pharmacist about the high cost of the script (six bucks). Pharmacist thinks how the heck is he going to pay for ER visit? Oh yeah, Joe is uninsured. Both the hospital and ER physician must absorb the loss.

Under my plan, both the hospital and physician get to deduct the cost of Joe's care. On April 15, the ER physician doesn't have to send Uncle Sam as much in taxes due to his charitable service.

Some local primary care physicians see that Dr ER keeps more of his income, so they decide to see some uninsured patients as well. The primary care doctors are able to identify some health issues and address them before they become emergencies. Pharmacy gets in on the act and delivers some charitable care by offering medications at either no cost or at a reduced price, taking the tax break.

Now Joe is able to see the same physician on a regular basis to have his medical needs addressed. The ERs are less crowded, seeing the true emergent cases. More hospitals stay open because they aren't losing money from seeing the uninsured. Hospitals aren't charging $14 for a Band-Aid to help make up for the losses they would have otherwise incurred. Granted there would have to be limits on how much charitable care could be claimed without being audited.

There you have it folks... health care reform in less than two pages. When converted into Congress-ese it might be ten pages. The federal government would still foot the bill as there would be a reduction in gross tax revenues, but I think it would be considerably less than the umpteen kabillion dollars that are going to be spent on HR 3590 if it becomes law.

Sunday, December 27, 2009

HR 3590 and MTM (I know... interesting subject matter)

On the morning of Christmas Eve, the United States Senate voted to approve HR 3590, the health care reform bill. Now all that is left is for the Senate and House to reconcile the bill and send it to the President for his signature.

If you visit the APhA website, you'll see the organization applauding the inclusion of MTM services in the bill. We all know that Medication Therapy Management is their thing. But does the inclusion of MTM in the bill really do anything to advance the profession of pharmacy?

The APhA statement following the passage of the bill, the APhA says that it supports the provisions of the bill that:
  • expand patient access to pharmacist clinical services
  • ensure patient access to medications
  • ensure a viable pharmacy infrastructure
  • improve the Medicare D MTM program

Looking at the language of the text of the bill, I do like seeing that the bill specifically states "pharmacist-delivered MTM services". From what I read, that means call center nurses who work for the insurance company can't provide the MTMs. It means that the call center pharmacists who work for the insurance company get to do it instead.

I would like to see the opportunity to provide the MTMs to be offered to the community pharmacists first. We are the ones who see the patients every day. We know their faces. We know their situations. We know their histories. We know that they tried their spouses cholesterol medication when they ran out of their own. We know how bad of an idea that was, too.

To a call center pharmacist, they are a chart. The call center pharmacist is going to suggest alternatives for the patients that didn't work five years ago when the patient was insured by the local plant. The fact that a clinical pharmacist recommends it doesn't mean that it is going to work now. There is no provider-patient relationship established.

After the call, the patient is going to come to the local pharmacist and ask about the call. More than likely, the local pharmacist will reassure the patient about the recommendations, only the local pharmacist won't get paid for the time spent with the patient (and get backed-up on their dispensing functions).

I would like to see a business model where medication therapy management is incorporated into practice and is self-sustaining. Everything that I have seen on MTM practice settings is in academia (funded by grants), clinics (funded by government), or as an add-on to retail services (funded by the dispensing functions of the pharmacy).

Once we see that MTMs are a viable business model, I think you'll see more pharmacists get on board with it. But for now, MTMs just don't cut it and I think most would agree that it just isn't doing anything to advance the practice of pharmacy for those of us who see the patients on a daily basis.

Wednesday, December 16, 2009

H1N1 Vaccine recall

In honor of the recall of the 800,000+ doses of pediatric H1N1 vaccine:

I've got a few topics I'm working on for future posts, but with my kids' basketball games and the holidays, there's not enough hours in the day to develop a good post. Plus I'm trying to get another Drug Topics article written.

Friday, December 11, 2009


I'm glad Gov Ted Strickland and the others in Columbus view pharmacy as a vital business entity in the state of Ohio. Dropping our dispensing fees will really help to keep pharmacies in business.

Thanks, Ted.

You have my vote next election.

Thursday, December 3, 2009

More on HR 3590

Well, I've pulled up Section 2503 of HR 3590 to take a look at how the federal government is going to try to reign in prescription medication expenses for the Medicaid program. Does it surprise any pharmacist out there that the legislation is worded in such a manner that we will basically get the shaft when it comes to reimbursements for Medicaid prescriptions?

In the legislation, the federal upper limit is defined as "no less than 175 percent of the weighted average... of the most recently reported monthly average manufacturer prices..."

There are a couple problems that I see with this.

First, for calculating the FULs, HR 3590 includes the following text: "The Secretary shall implement a smoothing process for average manufacturer prices."

Do you know what that means? It means that the government can fudge the AMPs to whatever it wants. The Secretary is directed to do so. And there's not a darn thing we can do about it except drop out of the contract.

Secondly, it mentions the most recently reported average manufacturer prices. How much lag time is there going to be in these reports. Last year when generic Micro-K 10mEq was in short supply I called one of the insurance companies to have them review the reimbursement levels as my pharmacy was losing over ten bucks per script. Their response... we review AWPs and MACs on a quarterly basis. Do you think that the federal government is going to respond to price changes in a more timely basis? This pharmacist doesn't think so.

So I'm going to question the APhA as to why they are not addressing this issue with the sponsors of the bill. I can't find anything at the website to make me think that they are even paying attention to the bill. I mean except for applauding the legislators for including the almighty MTM in the bill.

Pharmacists, pay attention to the bill.

Read the bill.

Our profession may hang in the balance.