06/11/2021 | News release | Distributed by Public on 06/11/2021 13:48
By Robert Yeakel, Director of Government Relations
Independent supermarkets operate over 3,000 pharmacies across the country. In many small towns and rural areas, the grocery store pharmacy is the only healthcare provider in the community. In recent years, two disturbing trends have been accelerating: Medicare Part D beneficiaries are paying higher out-of-pocket costs, and independent community pharmacies are closing. This is a direct result from pharmacies being assessed ever increasing direct and indirect remuneration (DIR) fees. These fees, often referred to as 'rebates' or 'price concessions', are abused by Part D plan sponsors and pharmacy benefit managers (PBMs) to strategically recoup funds from pharmacies long after transactions have been completed.
DIR fees are unpredictable and seemingly unconnected to a pharmacy's performance or other standards. According to recent Centers for Medicare & Medicaid Services (CMS) data, DIR fees grew by more than 91,500 percent between 2010 and 2019! Independent supermarket pharmacies have virtually no ability to absorb or budget for these unexpected costs. Even worse, because DIR fees are regularly applied to the price of a drug long after the point of sale, patients do not benefit and end up paying a larger share of the actual cost of the drug.
Pharmacy DIR reforms have enjoyed bipartisan support in both the House and Senate. In the 116th Congress, important Part D DIR fee reforms were included in House-passed and Senate Finance Committee-passed drug pricing legislation.
Just a few weeks ago, a bipartisan coalition of both House and Senate pharmacy champions introduced updated legislation. The Pharmacy DIR Reform to Reduce Senior Drug Costs Act (H.R. 3554 / S. 1909) seeks to lower cost sharing for Medicare Part D patients and ensure that community pharmacies continue to provide vital healthcare access to millions of Americans.
NGA and our pharmacy coalition partners are reaching out to members of Congress and asking them to cosponsor the legislation.
To take action and for additional resources, please click on the following links.
If you have any questions, or for more information, please contact Robert Yeakel at [email protected].