Washington, DC – As Sen. Charles Grassley (R-IA) assumes the Senate Finance Committee Chairmanship, the Senior Care Pharmacy Coalition (SCPC) today praised his longtime focus on health care sector pricing transparency and said a new Wall Street Journal report finding Medicare Part D providers overestimated their potential production costs by at least 5% — leading them to upcharge CMS by roughly $9.1 billion overly nearly a decade — is a ripe target for scrutiny.
“Among the many hallmarks of Senator Grassley’s congressional career is a devoted, dogged commitment to transparency in the health care marketplace,” stated Alan G. Rosenbloom, President and CEO of the Senior Care Pharmacy Coalition (SCPC), the only federal advocacy organization devoted exclusively to the interests of the nation’s long-term care (LTC) pharmacies and the patients they serve.
“The Wall Street Journal reporting on Part D plans’ routine ‘overestimates’ of product costs and subsequent CMS overcharging cries out for objective scrutiny — and we hope Chairman Grassley looks into this and the lengthy ledger of other taxpayer abuses at the hands of prescription drug plans (PDPs) and pharmacy benefit managers (PBMS),” Rosenbloom said.
The insurers told the WSJ the drug cost overestimates in the bidding process were a result of unpredictable pricing by manufacturers — and a concern that lowballing their forecasts would lead to financial losses. But the consistency suggests otherwise, according to researchers at Memorial Sloan Kettering Cancer Center — who said the probability of overestimating costs so frequently is “one in a million.”
“In the 116th Congress, SCPC will continue to advance the viewpoint that abuses like those detailed in the new reporting undermine the nation’s commitment to free and fair markets, and ultimately places unaffiliated pharmacies – like a majority of the nation’s LTC pharmacies – at an unfair and exploitative competitive disadvantage, benefitting neither elderly consumers nor taxpayers,” the SCPC President and CEO continued.
LTC pharmacies, a distinct subset within the pharmacy community, serve a specialized population of seniors in skilled nursing centers, assisted living facilities and other residential care settings. The typical patient suffers from multiple chronic conditions, significant impairments in daily living activities, mild to moderate dementia, and takes 12-13 prescription medications daily – making drug prices and access to needed medications an essential variable in maintaining vulnerable seniors’ health and well-being.
Rosenbloom said SCPC looks forward to working with Chairman Grassley and the Committee to further investigate what he characterized as “mystery reimbursement rates that change daily, added fees and discriminatory treatment that benefits corporate affiliates to the detriment of independent competitors, and the spate of PDP/PBM mergers and the impact on elderly consumers.”