Walgreens draws another line in sand, opting out of Delaware Medicaid fills
DEERFIELD, Ill. Pushing back against a plan by Delaware Medicaid administrators to slash pharmacy reimbursements, Walgreens warned state budget-cutters Thursday the chain would stop filling Medicaid prescriptions in all of its 66 Happy Harry’s locations enrolled in Delaware Medicaid as of July 6.
Walgreens’ dramatic announcement comes after state negotiators refused to consider a suite of alternatives proposed by the company and by the National Association of Chain Drug Stores, company officials said. And — as has been the case in some other states — Walgreens’ ultimatum thrusts the chain into a front-line position in community pharmacy’s ongoing battle to maintain adequate prescription reimbursement rates, as states hit hard by the recession and budgetary shortfalls scramble for ways to cut spending.
Walgreens is the state’s largest pharmacy provider since it entered Delaware via its acquisition of Happy Harry’s in 2006. Thus, its announcement is sure to galvanize opposition to the cuts among all community pharmacies in the state.
Thanks in large part to its clout as a multi-store pharmacy operator; Walgreens was instrumental in a successful campaign to halt plans to drastically cut Medicaid pharmacy reimbursements in the state of Washington earlier this spring. If that pattern holds, the chain’s move could lead policymakers in Delaware to reconsider similar cuts in that state.
Delaware’s Medicaid cuts come under a new Medicaid reimbursement rule that took effect April 1, and is due to become part of the state’s new fiscal budget beginning July 1. The new reimbursement model gives pharmacies in the state one of the lowest payment rates in the country for brand name and generic medications, according to Walgreens.
“Delaware is arbitrarily and unilaterally reducing the price it will pay for brand name medications. This will severely impact the ability of pharmacies to fill Medicaid prescriptions in the state,” the company stated Thursday.
Kermit Crawford, Walgreens’ SVP of pharmacy, explained the move. “We have made the decision, after much thought and care, to end our involvement with the state Medicaid program. Quite simply, we can’t continue to participate in a program that, in some cases, pays us less than our cost to fill these prescriptions.
“By making it uneconomical for pharmacies to continue filling Medicaid prescriptions, the state’s new payments to pharmacies hurt the very patients that Medicaid is meant to serve,” Crawford asserted.
The state “could easily eliminate its Medicaid pharmacy budget gap simply by focusing on its generic dispensing rate at all pharmacies in the state,” he added, since each percentage point improvement in the generic dispensing rate would save the state approximately $1.2 million annually.In addition, Crawford noted that Walgreens, in conjunction with NACDS, had approached the state “with a number of sound alternative strategies and programs that could help Delaware fill its Medicaid budget gap.
“Many of these alternatives were rejected, despite their successes in other states. None of these methods would adversely impact patient care, unlike the reimbursement cut.”
Majority of swine flu victims predisposed to illness
NEW YORK A preliminary analysis of 152 hospitalized patients due to H1N1 influenza found that at least 82% have belonged to one or more groups at higher risk of severe illness or complications from traditional influenza, such as seniors, the very young and those with upper respiratory diseases, the New York City Department of Health and Mental Hygiene announced Wednesday.
So far, the most common risk factor in New York City has been asthma – an underlying risk factor among 41% of the New Yorkers hospitalized for H1N1 flu. Other important risk factors included being less than 2 years of age (18% of hospitalized patients), having a compromised immune system (13%), having heart disease (12%) or being pregnant.
The New York City Health Department also linked two more deaths to H1N1 influenza on Wednesday. The latest fatalities – both in adults in their early and mid 40s – bring the total number of deaths in New York to seven.
Emergency room visits have declined somewhat after spiking dramatically during the third week of May, the agency reported. More than 300 New Yorkers have been hospitalized with H1N1 flu since late April.
FDA issues warnings to companies claiming to cure H1N1 virus
ROCKVILLE, Md. The Food and Drug Administration last month issued 35 warning letters to companies promoting a product for the treatment or prevention of the novel H1N1 influenza virus, suggesting that the agency is paying close attention to Internet marketers who may be hoping to capitalize on consumer fears of the “swine flu.”
Marketers were given 48 hours to respond to the warning letters.
“Firms that fail to take corrective action may also be referred to FDA’s Office of Criminal Investigations for possible criminal prosecution for violations of the FFDC Act and other federal laws,” the agency warned.
For those companies located outside the United States, the agency promised to intercept and refuse entry of their products at the border.
“This is to advise you that the United States Food and Drug Administration reviewed your web site at the Internet address http://www.fitura.com/ on May 15, 2009,” the agency stated in its most recent letter emailed to Fitura. “The FDA has determined that your web site offers a product for sale [Power Immune] that is intended to diagnose, mitigate, prevent, treat or cure the H1N1 Flu Virus in people. This product has not been approved, cleared, or otherwise authorized by FDA.”
The agency noted it is paying close attention to the marketing and sale of unapproved H1N1-related products partly on the request of the Centers for Disease Control and Prevention. However, the agency also noted that these products are “a potentially significant threat to the public health.”