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National LTC Pharmacy Group to HHS: Eliminate All POS and Post-POS Fees, Charges, Adjustments Paid by Pharmacies to PDPs/PBMs

July 20, 2018

WASHINGTON–In response to the Trump Administration’s initiative seeking comprehensive stakeholder ideas and input to address soaring consumer drug prices and general pharmaceutical market dysfunction, The Senior Care Pharmacy Coalition (SCPC) submitted policy recommendations to Health and Human Services (HHS) Secretary, Alex Azar, based upon a foundational premise that Medicare Part D market “has become an oligopoly, corrupting the free market predicate for the program.”

In offering their recommendations, Alan G. Rosenbloom, president and CEO of SCPC, said, “We offer a unique, constructive perspective on many of these issues since the LTC patient population is distinct from either the general or Medicare Part D populations—and because LTC pharmacy distribution and clinical engagement differs substantially from other types of pharmacies.”

SCPC is the only national organization exclusively representing the interests of LTC pharmacies. SCPC represents 75% of all independent LTC pharmacies whose members serve about 750,000 residents daily in skilling nursing facilities (SNFs) and assisted living facilities (ALFs) across the country.

SCPC’s cited four core premises upon which the submission is based and nine specific policy recommendations:

Key Premises

  • Medicare Part D no longer operates in a free market;
  • LTC patients are distinct from the general population or the Medicare Part D patient population;
  • LTC Pharmacy is distinct from other pharmacy types; and
  • A comprehensive set of solutions is essential to success.

Policy Recommendations

  • HHS should eliminate All POS and Post-POS fees, charges and adjustments paid by Pharmacies to PDP/PBM;
  • HHS should require PDPs and PBMs to provide full, complete and timely information to CMS concerning any manufacturer rebates they earn sufficient to assure that CMS sets benchmarks and payment rates to PDPs based on their net drug costs;
  • HHS should assure that any incentive payment programs that PDPs or PBMs use under Part D are based on independently developed and validated metrics; all PDPs and PBMs should use the same metrics to evaluate and modify payments to network LTC pharmacy performance and all such metrics used to evaluate and modify payments to network LTC pharmacies should be specific to the LTC patient population;
  • HHS should assure that pharmacy metrics used to evaluate PDP performance are independently developed and validated and are specific and relevant to the LTC patient population if used to evaluate the performance of LTC pharmacies under Part D;
  • HHS should eliminate gag clauses in PDP/PBM contracts with pharmacies, but also recognize that gag clauses are a symptom rather than a disease and address the underlying market conditions that allowed them to come into use;
  • HHS should recognize that LTC pharmacists and pharmacies have limited ability to assure that consumers have access to complete cost information regarding their purchase of drugs.
  • HHS should require that PDPs and PBMs treat affiliated corporations operating retail, mail order, specialty or LTC pharmacy the same as unaffiliated pharmacies;
  • HHS should require complete transparency from PDPs, PBMs and affiliated corporations, particularly pharmacy companies; and
  • HHS should impose an explicit fiduciary duty to consumers on PBMs.

The Senior Care Pharmacy Coalition (SCPC) is the only national organization exclusively representing the interests of LTC pharmacies. Its members operate in all 50 states and serve 750,000 patients daily in skilled nursing and assisted living facilities across the country. 

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