2024: The first 100 days | NCPA Executive Update | April 5, 2024

NCPA April 4, 2024

Dear Colleague,

Doug HoeyNext Monday, the 99th day of 2024, a solar eclipse will be visible in all 50 states. That's apropos for the first 100 days of 2024 for community pharmacies. Just as an eclipse darkens the sky, a series of failures by Congress, CMS, and UnitedHealth Group's vertically integrated Change Healthcare has cast a shadow over independent pharmacies. Congress failed again to pass PBM reform despite overwhelming bipartisan support. CMS failed to prevent PBMs from exploiting the DIR hangover. Change Healthcare failed to protect itself and its customers from a catastrophic cyber-attack.

To a certain degree, Medicare Part D rates being lower at the point of sale was expected. Everyone knew that getting rid of the retroactive pharmacy DIR fees would show up in lower reimbursement at the point of sale, so pharmacy contracts had to focus on net reimbursement. Some of that expected outcome has panned out as pharmacies are now finally able to see their net reimbursement before dispensing the prescription. What wasn't expected, however, was some of the trickery that some PBMs used to fill out their network at reimbursement rates, especially on brand drugs, which are often far below what the pharmacy pays for the drug. Deceptive tactics like phantom faxes, opt-out network participation, and deadline dates that had already passed.

And that brings up a key point we are hearing from members more this year than any other year I can remember. The pharmacy's business mix, which is their concentration of prescriptions managed by certain PBMs, is often the single biggest difference maker in that pharmacy's solvency.

NCPA members were pretty clear on which PBMs are the biggest problems in a survey NCPA released in February. The survey asked, "Which PBM is causing you the most Part D financial stress?" Cigna-ESI "won" in a runaway. It was cited by 47 percent of pharmacy owners as the worst of the worst, even beating perennial odds-on favorite CVS-Aetna, which was named by 35 percent of pharmacies.

One of the most eye-opening findings from the survey was that 93 percent of independent pharmacies said they will be "less willing to participate in Medicare Part D in 2025 based on their 2024 experience." Ninety-three percent! Putting it bluntly: PBMs sell you. A network of pharmacies is their biggest asset. Without a pharmacy network, they have nothing to sell. If pharmacies decide they can't participate in Medicare in 2025, millions of patients may have to find alternative health care, or do without it completely. PBMs should care. Patient groups should care. Congress should be panicked.

Which leads me to this point. In 2023, on average, every day three independent and chain pharmacies experienced a permanent eclipse—they closed for good. NCPA has been working hard on PBM reform legislation that would provide more prescription reimbursement predictability and stability in Medicaid and Medicare. That legislation has sailed through the legislative process. Yet, during the first 100 days of the year, Congress failed to act. It passed spending bills to keep the government funded, but it didn't include pharmacy legislation that would save over $1 billion dollars! During NCPA's upcoming Congressional Pharmacy Fly-In (April 17-18), as many pharmacy owners as possible are needed to ask your representatives: what are you waiting for and when will you pass PBM payment reform legislation to stop this wave of pharmacy closures before it's too late?

The next coast-to-coast solar eclipse isn't until 2045 but PBMs must be stopped from continuing to blot out patient access this year. Community pharmacy needs Congress to finish doing its job for the sake of community pharmacies and the patients you serve.

Best,

Doug Hoey

B. Douglas Hoey, Pharmacist, MBA
NCPA CEO

NCPA