Health IT lending plan in Congress wins praise from independent pharmacy
ALEXANDRIA, Va. A new proposal in Congress to make it easier for smaller-scale pharmacy owners to obtain low-cost loans to install health information technology was strongly endorsed Monday by the independent pharmacy industry’s chief lobbying group.
The National Community Pharmacists Association lauded Rep. Kathy Dahlkemper, D-Pa., for her sponsorship of the Small Business Financing and Investment Act of 2009, or H.R.3854. The bill, which has passed the House Small Business Committee, would allow state-licensed pharmacists and other health care providers to use a lending program for HIT through reduced-cost loans. Those loans would be guaranteed up to 90%, according to the bill, and borrowers could take advantage of a subsidized deferment period of up to 3 years. The bill is likely to move quickly to a vote by the full House, according to lobbyists.
NCPA EVP and CEO Bruce Roberts called the Dahlkemper proposal “a positive development for independent community pharmacies,” particularly in light of the fact that “the federal stimulus bill (American Recovery and Reinvestment Act) passed earlier this year accelerated the push for creating a national, interoperable health care system by 2014.”
Electronic health records, or EHRs, are a key component of that effort, he pointed out.
“Health information technology improves the quality of patient care, because health care providers are able to operate in a more efficient and coordinated manner,” said Roberts. “Evidence suggests that these breakthroughs will also save our health care delivery system money, but the upfront investments in technology are not inconsequential for small business owners who are already focused on their present daily operating challenges.
“That’s why nearly 23,000 independent community pharmacies across America are strongly supportive of… Dahlkemper’s leadership in getting her provision creating a lending program for pharmacists who invest in technology adopted in the House Small Business Committee’s larger bill on financing and investment,” added NCPA’s top executive. “The timing of this financial assistance is especially appreciated with the federal government’s drive to have system-wide use of electronic health records in a few years. Now pharmacists can focus on helping to create a system that works for everybody and not worry about the implementation costs of participation.”
GPhA applauds increased funds for Office of Generic Drugs
ARLINGTON, Va. A boost in funding for the Food and Drug Administration’s Office of Generic Drugs has received praise from an organization representing the country’s generic drug industry.
The Generic Pharmaceutical Association heralded the passage and signing of the 2010 Agriculture Appropriations bill, which set aside $51.5 million for the Office of Generic Drugs, a $5 million increase over last year.
“As Americans increasingly turn to generic medicines as a means to improve their health at affordable costs, this infusion of resources should help the FDA provide more timely access to generic drugs,” GPhA president and CEO Kathleen Jaeger said in a statement. “The Office of Generic Drugs has been severely under-funded for several years, and there is no doubt that the dedicated scientists and reviewers at FDA need more resources.”
Wielding care and service, indie pharmacy holds firm amid economic, profit hurdles
NEW YORK For two decades or more, independent pharmacy owners have been slammed by managed care, steady prescription reimbursement cuts, chain competition and regulatory hurdles. But in the Darwinian struggle of an unforgiving pharmacy market, the strongest are holding firm.
As the 2009 NCPA Digest makes clear, there’s still a big niche in a crowded retail market for independent community pharmacists who remember their customers’ names and personal histories, cultivate relationships with their patients, and go above and beyond with home delivery, in-the-aisle patient counseling or other extra services. The best independents have traded on those services to forge deep and lasting connections with generations of patients, and their roots within thousands of communities across the United States go deep enough to withstand challenges that have staggered some other retail channels.
The Digest findings are somewhat remarkable. In 2008, while the economy froze and a collapse in consumer confidence swept through the retail landscape like a tsunami, the independent segment of retail pharmacy managed a 7.6% average gain in sales, to an average annual total of $3.9 million. The total count of independent drug stores, as measured by the National Community Pharmacists Association, also held steady, at 22,728.
Even more noteworthy: the prospect of owning their own pharmacy continues to draw new proponents among new pharmacy graduates and practicing professionals. More than 1,200 new owner-operated drug stores entered the market last year, NCPA reported.
Where independents lag behind the powerful, deep-pockets pharmacy chains, of course, is in their ability to make high-ticket investments in cutting-edge pharmacy automation, advertising and other expensive retailing and technology tools. But even here, owner-operated drug stores are closing the gap, thanks in part to their participation in pharmacy marketing and franchise programs offered by the largest drug wholesale companies.
McKesson Corp. SVP Tim Canning, who is president of McKesson’s Health Mart franchise pharmacy division, said the support provided by the wholesale and health services giant feeds into the strengths independent pharmacists already wield as community-based patient care specialists.
“By providing our franchisees with access to advanced technology and best-in-class clinical and retail support, Health Mart pharmacists have the time and resources they need to develop relationships with their patients and counsel them on their individual healthcare needs,” Canning asserted recently.
One need look no farther than the latest consumer poll numbers from J.D. Power and Associates to see how well patients respond to that kind of personal attention. Independent pharmacy advocates had to like the results, since consumers surveyed by J.D. Power rated Health Mart and Medicine Shoppe — both of which are owner-operated drug store franchises — tops in overall customer satisfaction. Chain drug store pharmacies, by comparison, scored measurably lower.
All the same, glass-half-empty types could find plenty to fret about in the newest Digest findings. The biggest concern: that indies will lack the negotiating clout and financial reserves to stay ahead of the relentless downward pressure on dispensing margins as PBMs and other third-party payers press their advantage as the dominant source of payments to retail pharmacy.
Closely coupled with that threat is the inescapable fact that the government now accounts for more than half of all prescription reimbursements through Medicare Part D, Medicaid and the Tricare military health program. Further reductions in pharmacy payments by Medicaid or other programs could push many mom-and-pop drug stores over the edge.