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NCPA, NGA and NACS together file a ‘friend of the court’ brief in support of suit v. American Express

BY Michael Johnsen

ALEXANDRIA, Va. — In an effort to quell the significant sway creditors wield in dictating terms with retail vendors, the National Community Pharmacists Association, the National Grocers Association and the National Association of Convenience Stores on Monday submitted a joint brief to the Supreme Court as amici curiae, or "friends of the court," in the case of American Express vs. Italian Colors Restaurant. 

“Too often, independent community pharmacists are forced into take-it-or-leave-it contracts with large corporations," noted NCPA CEO Douglas Hoey. "NCPA filed this brief because independent community pharmacists deserve more leeway to challenge anticompetitive, anti-consumer conduct by dominant suppliers, including health insurance and credit card companies.”

“Most small business members have no choice but to enter into arrangements with credit card payment networks, health insurance companies and other suppliers of goods and services that wield substantial market power,” the associations stated. “In many of these current and prospective arrangements, these suppliers, like American Express, are insisting that our small business members waive their ability to privately enforce antitrust law via a class action — a procedure that has necessarily been and must often been utilized by our small business members to remediate losses caused by suppliers’ anticompetitive conduct and to enjoin such illegal conduct from continuing. If these class action waivers that have been forced upon our members are held to always be enforceable, even where our members would be deprived of effectively vindicating their rights under antitrust law, our members will suffer substantial harm.”

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Spartan Stores inks distribution deal with Chief Super Market

BY Antoinette Alexander

GRAND RAPIDS, Mich. — Spartan Stores, a regional grocery distributor and retailer, has entered into a distribution agreement with Chief Super Market under which Spartan Stores will be its primary wholesale grocery supplier.

Chief operates 12 stores in Northwest and West Central Ohio under the Chief and Rays banners. Spartan Stores stated that it will assume distribution to all of Chief’s banners for grocery, dairy, frozen, bakery and other products in March.

“We are pleased to welcome Chief to our distribution network of independent grocers,” said Dennis Eidson, Spartan’s president and CEO. “Chief is known for having strong grocery selections and well-merchandised stores, and we look forward to supporting their continued success with our broad selection of private brand and national brand products, as well as value-added services. We also are very excited about our expansion into Ohio, as securing new business in contiguous states is one of our key strategic business growth initiatives.”

Spartan Stores distributes more than 40,000 private and national brand products to approximately 375 independent grocery locations in Michigan, Indiana and Ohio, and to 100 corporate owned stores located in Michigan, including Family Fare Supermarkets, Glen’s Markets, D&W Fresh Markets, VG’s Food and Pharmacy, and Valu Land.
 

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Plaintiffs in Medi-Cal reimbursement case request rehearing

BY Antoinette Alexander

SACRAMENTO, Calif. — Plaintiffs in CMA et al. v. Douglas et al. have filed a request for a rehearing of the case on the heels of a reversal of the Federal District Court’s decision by a three-judge panel of the Ninth Circuit Court of Appeals.

The plaintiffs in the case — the California Medical Association (CMA), California Hospital Association (CHA), California Dental Association (CDA), California Pharmacists Association (CPhA), National Association of Chain Drug Stores (NACDS), California Association of Medical Product Suppliers (CAMPS), AIDS Healthcare Foundation (AIDS) and American Medical Response (AMR) — had 45 days from the day of the three-judge panel’s decision to ask for an en banc review. During that time, the injunction issued by the Federal District Court has remained in place.
 
“Cutting payment to Medi-Cal providers by 10% will have a huge impact on patient access to care,” stated Paul R. Phinney, CMA president. “The state is in much better fiscal shape now than when these cuts were initially proposed in 2011, and with millions of new Medi-Cal patients entering the program under the Affordable Care Act, the elimination of the Healthy Families Program and the shift of dual-eligible patients, we simply cannot continue to cut resources and expect successful implementation of health reform in California.”
 
Plaintiffs in CMA et al. v. Douglas et al. argue that reducing payments in the Medi-Cal system will force providers out of the program at a time when millions of new patients will be diverted into the Medi-Cal system.
 
CHA president and CEO C. Duane Dauner noted that the state’s acute care hospitals face an even more severe payment cut than other providers because the reductions are based on rates in effect in 2008-2009.
 
“Hospitals that operate skilled nursing units are facing a 25% cut in their Medi-Cal reimbursement,” Dauner stated. “These units provide complex medical care for elderly patients that is not available in any other care setting. If these cuts are implemented, access to care for thousands of elderly, frail patients will be compromised, and some rural or safety net hospitals may be forced to close.”
 
Tom Hayes, CEO of Eastern Plumas Health Care, noted that the Medi-Cal cuts would decimate hospital services in rural Plumas and Sierra Counties.
 
“These cuts will amount to a $2.4 million loss to our hospital if state officials go ahead with retroactive recoupment,” Hayes added. “To put this in perspective, over the past five years, our hospital’s average net income was $439,950. If we are required to pay this amount of money, it would not only cause us to close our skilled nursing facilities, it would cause the demise of our entire organization.”
 
CMA, CPhA and CDA successfully sued in the past to enjoin prior Medi-Cal cuts and expect to once again demonstrate that federal law, which ensures that Medi-Cal patients have equal access to health care, was not followed. That decision was made by the Ninth Circuit Court of Appeals.
 
“With the shift of 875,000 children from the Healthy Families Program to Medi-Cal as well as the implementation of the Affordable Care Act that will cover an additional 1.2 million children, the state’s attempt to cut reimbursement rates would harm patients’ oral health and their ability to access care,” stated CDA president Lindsey Robinson, a pediatric dentist. “California has among the lowest reimbursement rates in the nation, and this is not the time to make further cuts.”
 
"California is working hard to implement the Affordable Care Act, which includes moving 5 million Californians into the Medi-Cal system, plus another million children from Healthy Families into Medi-Cal," noted Jon Roth, CEO of the California Pharmacists Association. "If the Medi-Cal provider cuts are implemented, it will have a disastrous effect on real healthcare reform and will cause irreparable damage to California’s most vulnerable citizens. The California Pharmacists Association and other providers will continue to fight these cuts in order to protect access to care for all Californians."
 
Of added concern, the California Department of Health Care Services has repeatedly given numbers of practicing Medi-Cal physicians that are higher than the number of total physicians practicing in California. Plaintiffs raise this as a point of distress because it further shows that the state is unaware of the number of providers that patients are able to see.
 
“Cutting rates to Medi-Cal providers will impact the ability of Medi-Cal beneficiaries to access needed healthcare services,” stated Bob Achermann, CAMPS executive director. At the same time California is moving to implement the Affordable Care Act and transition existing beneficiaries to managed care plans they are endangering the ability of exiting Medi-Cal providers to participate in these programs.
 
“If affirmed, this decision will have a terrible impact on the health of Californians with HIV/AIDS,” added Tom Myers, AIDS Healthcare Foundation General Counsel. “Much of healthcare reform rests on expanding the number of people, including those with HIV/AIDS, on Medicaid, which due to these cuts will have even fewer doctors participating. This will further limit access, make people sicker, increase HIV infections in California, and undermine the very goals and purpose of healthcare reform.”
 
The injunction on the Medi-Cal cuts will remain in place until the full Ninth Circuit Court of Appeals has ruled.
 
“This is an important public policy issue that the 9th Circuit should review,” added Thomas R. Wagner, AMR Region CEO. “Reductions in Medi-Cal reimbursements for 911 emergency ambulance services may force municipalities to lower the high standards of EMS that Californians currently receive.”
 
The Federal District Court’s ruling in February of 2012 stated that, “California’s fiscal crisis does not outweigh the serious irreparable injury patients would suffer absent the issuance of an injunction.”
 
"Many Californians rely on services provided by community pharmacies, such as flu shots, medication counseling and health screenings. If implemented, these devastating Medi-Cal cuts could compromise patient health and access to pharmacy services, which also would drive up healthcare costs,” noted NACDS president and CEO Steve Anderson. "We are hopeful the Court will rule in favor of preserving patient access to pharmacy care."

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