Lawsuit Would Block Medicaid Drug Cuts

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Medicaid Drug Cuts

Below is a joint statement by Steven C. Anderson, IOM, CAE, president and chief executive officer of the National Association of Chain Drug Stores (NACDS), and Bruce Roberts, R.Ph., CEO and executive vice president the National Community Pharmacists Association (NCPA). Today the organizations filed a lawsuit in the United States District Court for the District of Columbia against the U.S. Department of Health and Human Services, the Centers for Medicare and Medicaid Services (CMS), as well as, in their official capacities, Health and Human Services Secretary Michael O. Leavitt and CMS Acting Administrator Kerry Weems. The lawsuit challenges CMS-imposed Medicaid pharmacy reimbursement reductions scheduled to be implemented via rulemaking in January 2008 that would reduce reimbursement rates below what is permitted by law.

"We are the nation's frontline health care providers and those in the best position to make sure patients have the medications and health information they need to get and stay healthy. Medicaid prescription drug cuts are, therefore, a big concern because they have a financial impact which ultimately hurts our patients' access to quality health care.

"The cuts to Medicaid pharmacy reimbursement rates which CMS wants to implement in January would force community pharmacies to sell Medicaid-reimbursed generic medicines at one-third below acquisition cost. Our members cannot do that and be able to purchase, stock, and dispense drugs in the low-income communities where Medicaid sales are a large percentage of the business. If unaddressed, small and independent pharmacies will be forced to close their doors or to drop out of Medicaid and further threaten low-income Americans' access to quality health care.

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"Today, we are announcing legal action, as well as redoubled advocacy for a legislative remedy this year, to fix this problem. We are pursuing this two-pronged approach, and while we are hopeful to have a success in court, it is imperative to encourage Congress to work with community pharmacy to find more appropriate, cost-based models for reimbursement under Medicaid.

"That is why, in addition to filing the lawsuit, we are announcing ongoing and even more vigorous advocacy for a legislative solution this year. Today, we are writing to U.S. Senators and Representatives in the committees of jurisdictions and co-sponsors of key legislation to describe the necessity of our lawsuit at this time, and to emphasize the continued need for a complete legislative remedy this year. We also are announcing a vigorous Washington, D.C. advertising campaign to demonstrate the urgency of legislative action this year.

"We thank for their leadership the bipartisan sponsors and co-sponsors of legislation to provide the necessary legislative solution, including Senate Finance Committee Chairman Max Baucus (S. 1951), House Energy and Commerce Subcommittee on Health Chairman Frank Pallone (H.R. 3700), and Rep. Nancy Boyda (H.R. 3140). Our message to Congress is this: the sense of urgency is greater today than it was yesterday, and it will be greater tomorrow than it is today.

"It also is critical for states to advance increases in dispensing fees, and we commend those states that already have taken action to safeguard prescription drug access for their residents including Texas, Louisiana, Montana and Oklahoma. We remain committed to working for similar progress nationwide.

"We look forward to the Court's expeditious and favorable review of our lawsuit, and to Congress' ultimate success in securing a complete and long-term solution this year, and we will continue our efforts on behalf of community pharmacy and the patients it serves to make these objectives a reality."

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