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Report: Medicaid pricing plan would have devastating effects

BY Jim Frederick

ALEXANDRIA, VA. —A new report from one of the pharmacy experts who has advised the Centers for Medicare and Medicaid Services lends credence to claims by community pharmacy leaders that the government’s new Medicaid reimbursement formula could seriously erode pharmacy profit margins and damage the industry.

Leaders of the National Association of Chain Drug Stores and the National Community Pharmacists Association are using the new study to bolster their claim that the new generic drug reimbursement formula could irreparably harm many pharmacies.

The author of the report, pharmacy educator Stephen Schondelmeyer, PhD, contends that the Medicaid reimbursement cuts, set to take effect Jan. 30, 2008, could devastate pharmacies that serve large populations of Medicaid patients in rural or inner-city urban areas. Those cuts could lead to the loss of as many as 10,000 to 12,000 pharmacies nationwide, he said.

In his report, Schondelmeyer condemns the government plan to shift Medicaid prescription payments for generic drugs to a new formula, based on the “average manufacturer price,”or AMP, of the drug. That market-based pricing formula, he contends, is seriously flawed because it takes into account the prices paid by mail-order pharmacies, institutional pharmacies and other pharmaceutical suppliers that don’t fall within the retail pharmacy class of trade, thus skewing the formula and leading to a false picture of what retail pharmacies actually pay for generic drugs.

NACDS and NCPA made extensive use of the Schondelmeyer study in court filings last month seeking an injunction against CMS’ new Medicaid payment plan. “The economic report by Dr. Schondelmeyer…is further evidence of both the illegality and anticipated harm of the final CMS rule,”asserted NACDS president and chief executive officer Steven Anderson and Bruce Roberts, NCPA executive vice president and chief executive officer. “It is worth noting that CMS has relied on [his] expertise and analysis previously, having hired him to prepare six reports for the agency.”

Schondelmeyer, who heads the Department of Pharmaceutical Care & Health Systems at the College of Pharmacy at the University of Minnesota, also warned that “flawed data related to this rule might be published online as early as December 2007,”they noted.

“In general, transparency of price information is usually a good thing for consumers and for the market,”Schondelmeyer reported. “However, when disclosed information is complex, confusing or even inaccurate, the transparency loses its value or even becomes counterproductive.”

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Stick Me Designs adds style to glucose meter bags

BY Michael Johnsen

VIRGINIA BEACH, Va. Stick Me Designs, an emerging accessory designer of diabetes glucose carrying cases for women, teens and children, announced the launch of their glucose meter bag collection Friday.

“While the medical supply industry is busy working on adding color, convenience and function to their meters, they’ve forgotten the most important aspect of their portability—the carrying case,” stated Rickina Velte, founder of Stick Me Designs. “We’ve taken on the task of infusing design, style and function that adds personality to an everyday necessity for people with diabetes.”

The new diabetes bags offer choices in color, fabrics, design and functionality.

The first collection features four contemporary designs created for the One Touch Ultra glucose meter and other more traditional larger-style testing meters. The bags have elastic placeholders for lancet devices, testing strips and glucose tabs or candy. They also feature interior open and zippered pockets for such everyday essentials as credit cards, identification, money, sanitizing wipes and an outside zipper pocket for other essentials.

Stick Me Designs’ introductory collection also features hand-selected faux suedes, designer upholsteries and cotton fabrics in retro and contemporary styles and colors.

Suggested retail prices will range from $32.99 to $45.99, the company reported.

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Continucare opens first clinic at Navarro

BY Antoinette Alexander

MIAMI Continucare Corp. has announced the opening of its first ValuClinic in-store health clinic within a Navarro Discount Pharmacy in Hollywood, Fla.

Similar to many other retail-based clinic models, the walk-in clinic will treat acute conditions and will be staffed by nurse practitioners and physician assistants.

According to Gabe Navarro, chief executive officer of the Miami-based pharmacy chain, Continucare was on the verge of opening a few locations in the recently acquired Sedano’s stores, so Navarro proceeded with the openings.

In October, it was announced that Navarro Discount Pharmacy would merge its operations with Sedano’s Pharmacy & Discount Store. Sedano’s is a Hispanic drug retail company with 11 pharmacies in the southern Florida market. Combined, the entity has more than 30 stores with annual revenues of more than $350 million. All of the stores are operating under the Navarro banner in the southern Florida market.

According to Navarro, plans call for Continucare to have three ValuClinics open in Navarro stores by the end of the year. It expects to have a total of 15 clinics in operation in 2008.

In late 2006 it was announced that Navarro had partnered with Express Clinics to introduce in-store health clinics to the southern Florida market; however, it is possible that partnership will come to an end.

“It is uncertain whether Express Clinics will continue to operate clinics in our stores,” Navarro told Drug Store News. “[We] should know more in the coming weeks.”

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