The Facts Speak for Themselves | NCPA Executive Update | May 31, 2024

NCPA May 31, 2024

Dear Colleague,

Doug HoeyThere's a lot of name-calling and snarky comments on social media by community pharmacy owners about Express Scripts. Most of it was focused on ESI's curious press release, in which they touted their new relationship with CPESN as proof that they love independent pharmacies. Unfortunately, it's a diversion, which they hope will fool enough members of Congress to avoid accountability for their business practices that are driving independent pharmacies to close. There's no need for hyperbole to describe their treatment of independent pharmacies. The facts bear out that it truly is as unconscionably one-sided as it looks.

Here are some of those facts:

  • NCPA members report to us that Express Scripts 2024 Part D contracts are the worst of the worst. The facts bear that out. As indicated, pharmacies are being paid below cost on 20% of all ESI prescriptions in Medicare. Factor in $10 per prescription for the cost of dispensing, which is less than many of the surveys measuring COD, and pharmacies are losing money on 78% of the prescriptions covered by ESI!

  • ESI recently issued a press release claiming to have a contract with CPESN, but CPESN's contract is with Cigna, not ESI. ESI went on to send their press release to Capitol Hill. Do they commonly issue press releases about agreements with provider groups? No, not that I could find on their website. Do they then send those press releases to the Hill? Perhaps they hope a confabulated press release sent to the Hill will convince Hill staff and Members of Congress that all is good with independent pharmacies and ESI?

  • Independent pharmacies continue to die—one each day—largely at the hands of PBM business practices with Express named by half of NCPA's members as the PBM causing the most damage to them in the Medicare program. Overall, the number of pharmacy choices for patients has shrunk by nearly 10% over the last several years due to pharmacy closures.

  • While the future of the profession includes being paid for patient care services pharmacists provide, those payments come nowhere close in making up the losses on the filling of prescription drugs that pharmacies are absorbing. Paying the pharmacy less than what the pharmacy buys the drug for is something all three PBMs do, but ESI is the worst offender.

  • ESI tried at least twice to form its Medicare pharmacy network for 2024. We've heard from a number of pharmacies that said "no" to the '24 ESI Part D contract, but ESI sent their opt-out contract again via e-fax in late 2023. Apparently smoke signals, carrier pigeons or the Pony Express were not available. If the pharmacy didn't respond again, they were enrolled in the network. Some pharmacies have asked to leave, and ESI has given them the Eagles "Hotel California" response: "You can check out any time you like, but you can never leave."

  • ESI continues to charge pharmacy Part D DIR fees post point of sale despite CMS Regulations saying that the lowest price must be reflected at the point of sale. NCPA has spoken to CMS about this since January and so far, there is no firm resolution to this violation of the final DIR rule.

There is no need for rhetoric. The facts speak loudly for themselves. Despite multiple efforts to try to reconcile the problems, the bad behavior of PBMs has gotten worse, not better, and ESI has been the leader of the pack. Unfortunately, at the rate independent pharmacies are closing due to prescription payments below what it costs them to buy the drug, there won't be any pharmacies left to provide patient care services. NCPA and CPESN are fighting for the same thing: Independent pharmacy sustainability. NCPA does it through advocacy and public education, and its goal is changing the pharmacy payment model. CPESN is a key part of that effort through health plan medication-use services contracts. Together we'll continue telling the health plans/PBMs that those contracts don't come close to off-setting inadequate prescription reimbursement.


Doug Hoey

B. Douglas Hoey, Pharmacist, MBA