NCPA: Latest FUL list from CMS a 'disaster in the making'

ALEXANDRIA, Va. — In response to a new second set of limits on generic drug pharmacy reimbursement that recently were proposed by federal Medicaid officials, the National Community Pharmacists Association on Tuesday reiterated its concerns with what the group characterized as the "flawed methodology" being used by the Centers for Medicare and Medicaid Services to determine the payment caps.

NCPA requested a meeting with CMS officials on the matter.
Last month, NCPA sent a letter to CMS about the average manufacturer price data the agency is utilizing to calculate new caps, known as federal upper Llimits, on Medicaid pharmacy reimbursement for many generic drugs. On Oct. 21, another set of draft FULs were published, but no adjustments were made to these cuts. In response NCPA earlier this month sent a second letter to CMS expressing a sense of urgency to address the issue before "irreparable harm" befalls the prescription drug benefit of Medicaid and possibly other health plans that follow suit.

"As was the case with the first list released by CMS in September, we continue to respectfully request that CMS not finalize the draft FULs due to serious shortcomings that would result in devastating economic consequences for small business community pharmacies that serve Medicaid patients," the letter reads. "AMP is not an accurate representation of the acquisition costs of small community pharmacies. This is evidenced by the fact that, even at 175% of the weighted average AMP, our cost of goods remains much higher than the FULs for many products on this list."

In an analysis of the latest FUL list, NCPA determined that on 62% of the medicines, reimbursements fell short of average pharmacy acquisition costs. What's more, the FULs that were lower than a typical independent's acquisition costs were for more highly utilized prescription drugs than those that were higher than their acquisition costs.

“These draft FULs are a disaster in the making for Medicaid recipients and the independent community pharmacists who serve them," NCPA CEO Douglas Hoey said. "In order to prevent a scenario whereby independent community pharmacies are forced to consider limiting their participation in Medicaid or leaving the program altogether, CMS should do three things. First, scrap the draft FULs. Second, produce a final AMP definition to serve as a guide for future FULs. Third, restart the implementation process with an understanding that low federal reimbursements, coupled with state Medicaid cuts, endanger Medicaid patients’ access to generic prescription drugs," he said. "Those objectives can be achieved while still following the intent of the Affordable Care Act, which mandates the revised reimbursement formula."

To view a copy of the letter, click here.

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