Prepping your business beyond DIR | NCPA Executive Update | October 25, 2019

NCPA October 24, 2019

Dear Colleague,

Doug Hoey

I write this on a plane to San Diego for the NCPA Annual Convention. Hosting an annual meeting is a little like planning a wedding ... a FOUR-day wedding ... for three THOUSAND people. For regular readers, it won't come as a surprise that the theme for this year's meeting is "Changing the Pharmacy Payment Model."

Pharmacy DIRs are one of the most glaring symptoms of the need for changing the model. If we were taking a test in pharmacy school, the case study might be: "The patient, Mr. Payment Model, presents itself to your pharmacy in great distress and experiencing shallow breaths and extreme discomfort. Payment Model complains of being confusing and complex. You notice that it is also cumbersome and shows extreme signs of being covert. What would be your drug of choice to treat?"

The treatment for the symptom of pharmacy DIRs is prohibiting them. But even after that is accomplished, the Payment Model will not be cured. Changing the pharmacy payment model is the cure. That's why NCPA is not only focused on pharmacy DIRs but also looking ahead at business and health trends that will affect your business. The NCPA Convention helps you prepare for those trends that will lead to a cure for Payment Model's sickness.

You already know about the CPESN® national network of clinically integrated pharmacies and how important it is to change the pharmacy payment model to one in which revenue is not solely focused on dispensing. But there are also other ways to treat Mr. Payment Model. As just one example, at the convention, we will talk about opportunities with CBD. Some analysts project that CBD sales will grow 107 percent annually for the next five years! If that is true, no matter how you feel about the medical efficacy of CBD, consumers will be voting with their pocketbooks. There's so much consumer interest that information about CBD is overwhelming. NCPA will be announcing new resources to help pharmacists so they can be a source of truth for patients. Where better than the neighborhood pharmacy to help consumers discern what's real and what's malarkey?

The majority of the ideas for NCPA's programs come from pharmacy owners. I can't think of a better source to create programs that are helpful to thousands of pharmacy owners!

While the convention burns brightly with business programs in the Gaslamp District of San Diego, back in Washington, D.C, NCPA staff will keep the home fires burning on the advocacy front. And, as I mentioned, there are other issues besides pharmacy DIR. Depending on your business mix, low Medicaid payment may be an even bigger issue. Medicaid managed care reform in the states is a priority of NCPA's state advocacy team and, working with state-based partners, they have helped make real progress in many states. Just in the last few months, 11 states have passed legislation or regulations in the MMC reform area, everything from increased transparency to prohibitions on spread pricing to Medicaid fee-for-service reimbursement benchmarks.

Importantly, CMS has jumped on the MMC reform bandwagon too, issuing guidance limiting spread pricing abuses — an issue NCPA championed and won in Medicare Part D and has long advocated for in Medicaid programs. And our friends on the Senate Finance Committee have recognized the need for reform and included major Medicaid reform provisions in their drug pricing package. Is it everything we want? No. Is it a great start? Absolutely.

For the many coming to NCPA's four-day big event, I look forward to seeing you there. For others, know that changing the pharmacy payment model is not only about pharmacy DIRs, it's also about exploring new ways to use the unique knowledge you have as a pharmacist and marrying that with business skills. NCPA is here to officiate the union.


Doug Hoey