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Give local pharmacies a level playing field

July 08, 2007|By Leo Mallard

Decades ago, pharmacists were fondly referred to as "Doc," recognized as health care providers and respected for their tireless service to patients. Today, pharmacists still provide the same level of care to patients. Unlike other health care professionals, they are accessible without an appointment 24 hours a day, seven days a week. In rural parts of the country, where there is only one pharmacy per town, it is not unusual for a pharmacist to open his store in the middle of the night to fill a prescription for a sick child.

Yet for all the countless hours pharmacists devote to patient care, counseling them on taking their medication properly, or helping seniors understand their Medicare Part D plans, independent pharmacies are on the verge of extinction - because they are not being reimbursed fairly for their services. Over the past 20 years, pharmacy benefit managers (PBMs) that manage prescription health plans for private insurers and the government have ratcheted down reimbursement to pharmacies so low that they are virtually dispensing prescriptions at a loss. PBMs have removed care from this area of health care and replaced it with profits for their shareholders.

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When the Medicare prescription drug plan went into effect last year, the economic situation facing neighborhood pharmacies worsened. PBMs, which manage the drug plans, paid pharmacies below the cost they incurred to fill a prescription for Medicare patients. As a result, many pharmacists took out personal loans or closed their stores because they no longer could stay afloat.

Congress must level the economic playing field between pharmacies and the giant PBMs by giving pharmacies real negotiating power under antitrust law.

Typically, PBMs offer pharmacies take-it-or-leave-it contracts for the private and government-run drug insurance plans they manage. This means the PBMs dictate the terms; there are no negotiations on pharmacy reimbursement rates. A bill introduced by Rep. Anthony Weiner, Democrat of New York, and Rep. Jerry Moran, Republican of Kansas, would change the antitrust laws to allow independent pharmacies to band together and negotiate contract reimbursement rates as a group with PBMs.

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