Pharmacy Group Wants CMS To Distinguish LTCs From Retailers Through RFI

DATE: September 17, 2026

Lauren Brensel // Inside Health Policy – September 16, 2026

A trade association representing long-term care pharmacies (LTCs) is hoping CMS will use an upcoming request for information to establish guidance on contracting issues like reimbursement rates and network adequacy standards that could differ for retail pharmacies.

The group has met with CMS to discuss its requests and anticipates the RFI, a draft of which the agency sent to the White House last month, could be issued before the April 2027 statutory deadline.

The Senior Care Pharmacy Coalition (SCPC), which oversees about 325 LTC pharmacies, wrote a letter to CMS last month requesting that the agency’s RFI on pharmacy contract terms for Medicare Part D plans include questions about the impact to LTCs, which the group argues may need different payment frameworks compared to retail pharmacies because of the different services they provide, like coordinating with nursing and assisted-living staff.

“One of the issues that we had raised to CMS that they encouraged us to bring up in this RFI is that the cost of long-term care pharmacy — which is the packaging, the hand-to-hand delivery, the oversight by the pharmacists going into the facility and doing the drug remediation — all of that is often overlooked,” SCPC President and CEO Esmé Grewal told Inside Health Policy.

SCPC wants the RFI to ask stakeholders about tactics LTCs feel are used to drive unfair practices, differing costs LTCs take on as opposed to retailers, and how LTCs’ process for delivering medications differs from retailers. The group also asked CMS to include questions about whether LTCs providing assisted care and living facilities should be subject to separate and sometimes lower reimbursement rates.

CMS is required to issue the RFI under the Consolidated Appropriations Act of 2026, which introduced new reporting mandates and rebate policies for pharmacy benefit managers (PBMs). The act, which lawmakers passed in February, directed CMS to enforce “reasonable and relevant” contracts between PBMs and Medicare Plan D sponsors.

HHS is mandated to publish its RFI on contracting by April 2027, though some stakeholder groups expect the department to pose its questions before then. The RFI is pending at the White House Office of Management and Budget, indicating it could arrive earlier than expected.

“CMS is working to develop these contract terms and will soon release a Request for Information seeking input on items that constitute reasonable and relevant terms,” the National Community Pharmacists Association wrote in a press release earlier this month, announcing the group had met with CMS to discuss implementation.

SCPC is asking CMS to act on what the group describes as inadequate reimbursements from PBMs by establishing a minimum payment standard or clarifying that low reimbursements aren’t reasonable. The group said CMS should also clarify that Part D plans are required to reimburse prescriptions based on their brand or generic status at the time of dispensing them, writing that some plans opt to reimburse for the price of a generic if it comes into market after an LTC pharmacy purchases a brand-name drug.

“As CMS is aware, Part D dispensing fees range from $1 or less for generics (90% of the drugs dispensed) and around $4.50 for branded drugs. Yet, the true cost to dispense for long-term care pharmacies, measured before additional economic pressures went into effect from the Inflation Reduction Act, was approximately $17.65,” the group wrote in its letter.

SCPC also outlined a list of unfair contracting practices its member pharmacies have reported, including efforts from PBMs to limit an LTC pharmacy’s ability to join a pharmacy services administrative organization (PSAO), which negotiates reimbursement rates with PBMs on behalf of smaller or independent pharmacies.

One of the biggest reforms SCPC asked for is implementing statutory authority to hold PBMs and sponsors accountable for maintaining proper contracts throughout the entire term. SCPC’s letter follows a policy refresher the group released in June, recommending CMS implement an audit review process and new open enrollment requirements after one of the three largest PBMs, Optum, cancelled its contract with a PSAO mid-term.

SCPC wrote CMS could require all LTC pharmacies to be in network by a certain date, allowing pharmacies to use a special enrollment period to switch if plans don’t comply.

“CMS should also set parameters around when it is reasonable for a Plan to notify a beneficiary about a possible disruption in their pharmacy service; often Plans exploit beneficiary notices to pressure pharmacies into signing unfavorable contract terms to avoid notices being sent to facilities or patients regarding their network status,” SCPC wrote.

LTC pharmacies are also subject to audit processes SCPC said are designed to “generate recoupments rather than identify true fraud, waste, or abuse,” which leads to many cases in which a pharmacy must repay an entire claim for a prescription that’s medically necessary and dispensed appropriately but was reported with an administrative error.

“A reasonable and relevant audit process should focus on identifying fraud, waste, and abuse while recognizing the difference between intentional misconduct and harmless administrative errors. Ensuring that audit practices are transparent, consistent, and proportionate would reduce unnecessary administrative burden and waste,” SCPC wrote.

Read the article in Inside Health Policy HERE.