NCPA released a first-of-its-kind analysis Thursday, conducted by 3 Axis Advisors, finding that under the Medicare Drug Price Negotiation Program small and independent pharmacies will face significant lost revenue, payments below their cost to buy the drug, and significant cash flow disruptions. The consequences could force more closures, reduce medication availability, and force staffing cuts, causing serious harm for Medicare-enrolled seniors.
The analysis showed that prescription payment settlement delays under the program will last at least seven extra days for negotiated drugs, create weekly cash flow shortfalls of nearly $11,000 per pharmacy, and cost an average of $43,000 in annual revenue to those pharmacies. It could also take away from revenue used for charitable care or expanded health care services at 340B covered entities.
"Like many government programs, the intent is good, but the unintended consequences undermine the goal," said NCPA CEO Douglas Hoey. "That's exactly the case here. Everyone wants to reduce drug costs for seniors and taxpayers. But, as our research shows, the program is structured in a way that will force many independent pharmacies out of the Medicare Part D program. Drug prices may come down, but there will be a shortage of pharmacies to dispense medicine. Seniors will be stranded without a pharmacy, and they won't get the benefit of lower drug prices."
To read our full release and access the analysis, click here.
