Taking its case to state lawmakers, pharmacy works to ease Medicaid cuts
CINCINNATI The new Medicaid pharmacy payment model has arrived, and pharmacy leaders fear its long-term impact could be a severe drop in profitability as the Centers for Medicare & Medicaid Services adopts a new reimbursement formula. In response, the National Association of Chain Drug Stores and other stakeholders have shifted many of their efforts to stave off the worst effects of the new regulations to the states.
Those efforts are showing results. Working through its state government affairs division, NACDS is helping to conduct “value of pharmacy” tours of local pharmacies for state legislators as part of a broad grass-roots campaign to spotlight the importance of the profession and the potential damage that could be wrought by the Deficit Reduction Act, and by the new Medicaid reimbursement regulations CMS adopted in response to the DRA.
One official spearheading those efforts is Dale Masten, NACDS regional government affairs manager for Ohio and the Southeast. Working with the Ohio Pharmacy Association, Masten and other pharmacy representatives invited state Rep. Lynn Wachtmann to tour two drug stores operated by Walgreen Co. and Meijer in Defiance, Ohio.
“At a briefing we were doing on the Deficit Reduction Act, I mentioned it to him and he was very interested … and we set it up,” Masten recalls. “I think it was very beneficial. It makes a huge difference to see pharmacists delivering patients drug therapy management, or advising them at the counter on how to take their medications.
“There’s so much that a pharmacist does that a lot of times a general assembly member just doesn’t know about,” he added. “It’s just a whole broad education for them on the impact the Deficit Reduction Act can have, on the role pharmacists can play, and on the technologies that are out there in the pharmacy.”
As a result of the Wachtmann visit, Masten continued, “I think he has a much better understanding of what a pharmacist goes through, and that it’s not just counting pills.”
Wachtmann is former chairman of the Senate Health Committee and is now vice chairman of the House Health Committee, so is influential in advancing a health policy agenda.
Wachtmann’s interest in pharmacy affairs—an interest promoted by his tours of Walgreens and Meijer—may make a big difference in the way the new Medicaid payment model plays out for Ohio pharmacies. In June, following his visit, the state legislature passed a bill to ease the impact of the Medicaid cuts to pharmacies when the new regulations take full effect next year. The governor quickly signed the bill into law as part of Ohio’s budget process.
“Rep. Wachtmann spoke out quite loudly on the ‘hold harmless’ legislation that was passed with the budget,” said Masten. That legislation, he added, requires the state’s Medicaid program to study the effects of the Deficit Reduction Act within 30 days of the CMS rule implementation next Jan. 30.
Within 10 days of that study’s completion, Masten said, Medicaid in Ohio will be required to boost dispensing rates to offset the impact of the new federal payment guidelines for pharmacies, pending approval of the state’s reimbursement plan by CMS.
“It’s budget neutral, because whatever savings Medicaid incur as a result of these lower reimbursements, that amount is used to increase pharmacy funding,” he said.
NACDS, Masten added, “worked very closely with the Ohio Pharmacists Association and the Ohio chain drug companies” to enlist the support of lawmakers. “It was a great coalition…in working with the [state] Medicaid [office] and helping to draft this legislation,” said Masten.
“I’ve already talked to another state representative who’d like to do the same thing” by seeing pharmacies in action face-to-face, he added. “Clearly, Rep. Wachtmann … is educating his colleagues on the importance of pharmacy.”
Pharmacy groups like NACDS and NCPA, along with state pharmacy associations, local pharmacy retail operators and other groups, are also finding some success in other states in convincing state lawmakers to help close the payment shortfall most pharmacy leaders anticipate once the new Medicaid payment regulations go into effect. “A glaring example is in North Carolina, where chains and independents mustered up 9 or 10,000 letters and e-mails that went to the North Carolina General Assembly, and that helped avert a 5 percent reimbursement reduction for Medicaid,” said Masten. “So I think working closely with legislatures can really help.”
Cardinal Health bolsters clinic program
INDIANAPOLIS —Many industry observers may not be familiar with Corner Care Clinic, but that is likely to change as Cardinal Health has formed an alliance with, and is a minority investor in, the clinic operator.
Cardinal Health teamed up with Indianapolis-based clinic operator MindGent Healthcare Clinic’s Corner Care Clinic to open in October 2006 the first retail-based clinic. Today, there are 27 walk-in clinic locations.
Corner Care Clinic operates locations in Indiana, Ohio, Connecticut, New Jersey, Pennsylvania, North Carolina, South Carolina, Illinois and New York.
The clinics are located within select Medicine Shoppe, Medicap and independent Leader pharmacies, as well as two Kerr Drug stores and, coming in September, two Drug Fair locations.
The goal: to open an additional six to 12 clinics by year’s end. Going forward, Corner Care Clinic would like to open between 60 and 100 clinics a year.
“When we first made the decision to throw our hat into the ring…we wanted to find a partner whom we felt shared the same vision and mission that we had,” health care veteran and president and chief executive officer of Corner Care Clinic, Julie Beckner, told Drug Store News.
Signifying not only a shift in the health care industry toward convenient health and wellness offerings, but also signifying the key role Corner Care Clinic will play in the Cardinal Health portfolio, Corner Care Clinic participated in the Cardinal Health Retail Business Conference held last month at the Hynes Convention Center in Boston.
As is common of the acute care retail clinic model, Corner Care Clinics are staffed by nurse practitioners that treat such common ailments as strep throat and pink eye, and also provide vaccinations, physicals and screenings for such conditions as diabetes and blood pressure. The average cost ranges between $55 and $75.
Aiming to educate its independent pharmacies on the opportunity, Cardinal Health introduced the clinics, as well as other offerings, at the 18th annual RBC. Touted as the latest addition to Leader Total Pharmacy Manager, Cardinal’s suite of services to help independent pharmacies bolster revenue and drive productivity, the in-store clinics provide yet another way for its retail pharmacy customers to expand their health care reach and better serve their communities. Currently, more than 3,000 independents are part of Cardinal’s Leader pharmacy network.
Meanwhile, Corner Care Clinic has been working to bolster its management team, last month announcing two key executive moves.
Assuming the role of corporate director of marketing for Corner Care Clinic is Mike Milakis. Previously, he served as owner, president and creative director for M&M Advertising for 11 years. During his career, Milakis has worked with more than 50 different hospital, insurance, pharmaceutical and health care-related clients, including Eli Lilly,I.U. Medical Center and University of Chicago Hospitals.
Corner Care Clinic also has promoted Mark Rollins to chief medical officer of the company. Previously, he served as Corner Care Clinic’s medical director.
Prior to joining Corner Care Clinic, Rollins, a board-certified physician, served as chief of medicine at Marion General Hospital in Marion, Ind.
In a recent interview with Drug Store News, Keith Cook, who joined Medicine Shoppe International in late 2006 as vice president of pharmacy solutions, said the partnership is important to Cardinal Health’s MSI division because there is a real “need in the community” for convenient and affordable acute care.
“There are some counties where there is not even a hospital within a 30-mile radius of our store. So ER visits are very difficult for some of our regular patients that we see every day. And there’s also the current health care situation in America. It isn’t easy to get in and get an appointment immediately when you need minor care. So the need was there, and it fit very nicely into our business model,” Cook said. “The reason we like [Corner Care Clinic] as a partner is that they do a very good job of working with the local physician community, and that was really important to us.”
Added Beckner, stressing the importance of working with the local medical community, “[Corner Care Clinics] addresses a real need, but we also are a physician advocate.”
Respiratory drug sales climb as asthma, COPD cases rise
The global respiratory drug market is projected to exceed sales of $44 billion by 2010, according to market research firm Kalorama Information.
As the incidence of lung and breathing-related illnesses climb around the world, drug sales in the segment have continued to rise as well. Kalorama researchers report that sales have increased at the rate of 11 percent annually, from $19 billion in 2000 to $32 billion in 2005.
Asthma, a leading respiratory disease, was diagnosed in 19.8 million people in the United States in 2003, with 11 million experiencing an asthma attack in the previous year, according to the most current statistics from the Centers for Disease Control. In 2002, asthma accounted for 12.7 million doctor visits, 1.2 million hospital outpatient visits, 1.9 million emergency room visits and 484,000 hospitalizations.
An illness that affects the lungs, asthma is the most common long-term disease of children. Symptoms include wheezing, breathlessness, chest tightness and nighttime or early morning coughing. Asthma always is present, but a patient will suffer attacks only when the lungs are stimulated. Triggers include: tobacco smoke, dust mites, air pollution, cockroaches and their droppings, furry pets and mold. Also, physical exertion, high emotional states or extreme temperatures can lead to an attack.
Treatments fall into two categories: long-term control drugs and quick-relief drugs, such as inhalers. Asthma cannot be cured.
Meanwhile, another respiratory disease that often is confused with asthma is chronic obstructive pulmonary disease, and that afflicts another 20 million Americans.
Top-ranked treatments for asthma and COPD posted strong global sales results last year. Advair grew 11.7 percent to $6 billion, Singulair climbed 20 percent to $3.6 billion, Zyrtec rose 12 percent to $2.5 billion, Spiriva shot up 48.5 percent to $1.6 billion, Pulmicort rose 11.2 percent to $1.3 billion and Flixotide increased 4.5 percent to $1.2 billion, according to market research firm Wood Mackenzie.