Long-Term Care Pharmacies Gear Up To Lobby With New Trade Group

Independent long-term care pharmacies hope to exert a strong lobbying force in 2015 after having formed last fall the first-ever trade group focused on policies specific to their industry, including daily dispensing fees, maximum allowable costs and drug-abuse policies. Other pharmacy trade groups already lobby on similar issues, but Senior Care Pharmacy Coalition President and CEO Alan Rosenbloom tells Inside Health Policy that he hopes the group will be more effective than others by only working on legislative and regulatory interests of pharmacies that provide services to seniors in nursing homes.

“Until now, no other organization has been dedicated exclusively to representing the interests of independent LTC pharmacies,” the group states in a release. “Unfortunately, we are living with the consequences, with such policies as MAC pricing and daily dispensing fees.”

The National Community Pharmacists Association established a long-term care division a few years ago that works on the same issues. A spokesperson for that group says the two trade groups are likely to have overlapping goals.

“In 2015, that is likely to include the pro-rated dispense fees associated with short-cycle dispensing fee problem as well as MAC (maximum allowable cost) reimbursement and pharmacy audit issues,” NCPA Vice President of Public Affairs Kevin Schweers says, adding that last year NCPA got CMS to require Part D plans to update rates every seven days to reflect market costs of pharmacies buying drugs. “In 2013-2014, our work in this area included the above topics plus vocal opposition to hydrocodone rescheduling and the DEA disposal of controlled substances final regulation (which incorporated NCPA suggestions to mitigate the impact on LTC pharmacies and residents).”

The Senior Care Pharmacy Coalition includes 16 long-term care pharmacies, and Rosenbloom says he expects to rapidly add more members. Rosenbloom is the former CEO of the Alliance for Quality Nursing Home Care, which represented for-profit nursing homes until in 2013 it merged with the American Health Care Association. The alliance originally was formed by chain nursing homes as an AHCA subgroup, and in 2005 many alliance members dropped out of AHCA in part because they believed their policies weren’t getting sufficient attention from the rest of the nursing home industry.

Congress is expected to at least override Medicare physician-pay cuts by the end of March, and Rosenbloom says the Senior Care Pharmacy Coalition will take advantage of the opportunity to lobby for favorable daily dispensing fee legislation while potentially defending against efforts to block implementation of transparency regulations for maximum allowable costs. When Congress overrides the pay cuts scheduled by the Sustainable Growth Rate formula, they’re often paid for by cuts to other Medicare providers — the last SGR patch included a nursing home sector offset, although nursing homes lobbied for that readmissions measure.

Michael Bronfein, chair of the Senior Care Pharmacy Coalition and co-founder of Baltimore-based NeighborCare and Remedi SeniorCare, tell Inside Health Policy that the group also could pursue its policy goals in the courts and in negotiations with pharmacy benefit managers.

Long-term care pharmacies are angry that some pharmacy benefit managers have started prorating dispensing fees. Pharmacy benefit managers typically have paid pharmacies a flat fee to cover the cost of dispensing drugs. The Affordable Care Act requires that pharmacies dispense certain Part D drugs to nursing home residents in amounts no greater than two week supplies. Some pharmacy benefit managers have started paying pharmacies for only a portion of the dispensing fee when patients stop taking medications before the end of the two-week cycle. Bronfein says pharmacies have a fixed cost to dispense medicine, and if they’re paid for only part of the fee, they lose money. Unlike retail pharmacies, long-term care pharmacies must work closely with nursing homes to adjust dosing and to keep up with the ever-changing drug regimens of nursing home residents, he adds.

A related policy that long-term care pharmacies are fighting over with PBMs is the maximum allowable cost list, which is a list of products that PBMs generate that includes the maximum amount that they pay for generic drugs and brand-name drugs with generic competition. Long-term care pharmacies complain that PBMs reimburse their contracted pharmacies low, based on the MAC list, then sell to their clients or plan sponsors at a higher cost and pocket the difference.

The trade group also plans to urge changes to the Drug Enforcement Agency’s controlled substance policies. Although well intentioned, some DEA policies impede pharmacies from quickly delivering pain medications to nursing home residents, Bronfein says.

“Congress must work with stakeholders to bridge the growing gap between the goals of DEA drug enforcement policies, Centers for Medicare and Medicaid Services (CMS) regulations, high standards of patient care, and market realities,” according to a Senior Care Pharmacy Coalition statement.

A spokesperson for the Pharmaceutical Care Management Association, which represents pharmacy benefit managers, defends the practices that pharmacies are trying to change and warns against CMS meddling in negotiations between pharmacies

and pharmacy benefit managers.

“Public and private programs have long relied on Maximum Allowable Cost (MAC) reimbursement lists to ensure pharmacies don’t overcharge for generic drugs,” PCMA Vice President of Strategic Communications Charles Coté says. “Furthermore, long- term care pharmacies should be paid like all other pharmacies–in real time, and only for the specific prescriptions they dispense.”

“For CMS to interfere in contract negotiations between plans and long-term care pharmacies would inflate taxpayer costs, do nothing to improve quality, and violate CMS Administrator Tavenner’s pledge to avoid such controversial changes to Medicare Part D,” Coté adds. — John Wilkerson (jwilkerson@iwpnews.com)!