Creation of Clear Regulatory Pathway Would Also Lower Total

Expenditures for Biologics by $25 Billion over Ten Years

 

(Washington, DC)— The Congressional Budget Office (CBO) today released a cost analysis finding that the creation of an abbreviated pathway for follow-on biologics—or biogenerics—would save the federal government $6.6 billion over ten years and lower total expenditures for biologics by $25 billion over the same time period.

“For a quarter century, generic versions of chemical drugs have saved consumers and payors billions of dollars.  Now, CBO has confirmed that giving FDA additional authority to approve generic versions of biologics will save billions more,” said PCMA President and CEO Mark Merritt.  “Even greater savings would be available if Congress simply applied to biologics the Hatch-Waxman standards that are currently used to approve generics for chemical compounds.  It would be helpful if some provisions in the bill—such as ‘evergreening’—which unnecessarily delay the entry of biogenerics were reconsidered.  CBO acknowledges that the ‘evergreening’ issue will present significant problems beyond the ten-year scoring window.”

 

CBO estimates that:

 

• Enacting S. 1695 would reduce total expenditures on biologics in the United States by $25 billion over the 2009- 2018 period.

 

• Enacting the bill would reduce budget deficits (or increase surpluses) by a total of $6.6 billion over the 2009-2018 period.

Unlike conventional drugs, there is no clear regulatory process where biogenerics can be approved by the FDA.  PCMA was joined by a number of influential consumer, employer, and insurer groups who endorsed the “Access to Life Saving Medicine Act of 2007,” bipartisan legislation that seeks to create a clear regulatory pathway for biogenerics. 

 

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PCMA is the national association representing America’s pharmacy benefit managers (PBMs), which administer prescription drug plans for more than 210 million Americans with health coverage provided through Fortune 500 employers, health insurance plans, labor unions, and Medicare Part D.

 

Accelerated Payment Cycle Would Create a ‘Stampede’ of Other Medicare Providers Demanding the Same Treatment Next Year

(Washington, DC)—As policymakers consider what to include in the final Medicare package, they face the decision of either supporting costly Medicare “prompt pay” requirements for pharmacies or postponing the Average Manufacturer Price (AMP) pharmacy reimbursement cuts in Medicaid which would ultimately harm both pharmacies and consumers, the Pharmaceutical Care Management Association (PCMA) said today. 

 

 

“Now that we’re in the endgame, Congress must choose between a reasonable AMP delay and a new policy to pay drugstores twice as fast as every other Medicare provider,” said PCMA President and CEO Mark Merritt.  “Delaying AMP is supported by a broad coalition of pharmacists, PBMs, and insurers.  ‘Prompt pay’ has no such support and would undermine the affordability and integrity of the Medicare program.”  

 

PCMA joined a group representing almost every segment of the pharmacy supply chain who signed a letter to Congressional leaders urging passage of legislation that will postpone the AMP payment reductions that threaten to devastate retail pharmacies and their low income patients.  Those signing the letter included:

 

• American Pharmacists Association
• Food Marketing Institute
• Generic Pharmaceutical Association
• Healthcare Distribution Management Association
• National Alliance of State Pharmacy Associations
• National Association of Chain Drug Stores
• Pharmaceutical Care Management Association

Medicare prescription drug plans (PDPs) pay pharmacy claims within 30 days, a standard consistent with Medicare Parts A & B, the federal employees’ health plan, and the private sector. The 30-day payment standard allows plans to batch claims for administrative efficiency and conduct audits to detect fraud and abuse.

 

The independent drugstore lobby partnered to create its own drug plan—Community Care Rx (CCRx)—which pays claims in 30 days—twice the length of time as the 14 day mandate in their own bill.  A link to the payment schedule for “one of the nation’s top Medicare Part D prescription drug plans” is provided. 

 

Three separate but remarkably consistent studies—including the drugstore lobby’s own study—highlight that PBMs are paying claims on time.

 

• Grant Thornton study (the drugstore lobby’s own study) that shows pharmacies are being paid within 30 days (See Page 15 for findings on average payment time).  
• Part D claims are being paid within 21-25 days, according to the Centers for Medicare & Medicaid Services. 
• Part D claims are paid within 23 days, according to a PricewaterhouseCoopers (PwC) study.

To highlight the costs associated with the independent drugstore lobby’s agenda, PCMA recently released a series of new prints ads.  One print ad warns policymakers that other Medicare providers—including doctors and hospitals—would likely demand the “same prompt-pay deal” next year if Congress requires pharmacists to be paid twice as fast in Medicare.   An additional print ad highlights how “finding the bad apples isn’t easy” in detecting fraud, waste, and abuse and that proposals mandating “prompt pay” would make it even tougher.

 

 

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PCMA is the national association representing America’s pharmacy benefit managers (PBMs), which administer prescription drug plans for more than 210 million Americans with health coverage provided through Fortune 500 employers, health insurance plans, labor unions, and Medicare Part D.

AMP Delay Coalition Letter to Capitol Hill

PCMA Medicare Fraud Letter to Capitol Hill

Doctors, Hospitals, and Other Providers Would
Likely Demand Similar Treatment Next Year

(Washington, DC)- The Pharmaceutical Care Management Association (PCMA) released a new ad today warning policymakers that other Medicare providers-including doctors and hospitals-would likely demand the “same prompt-pay deal” next year if Congress requires pharmacists to be paid twice as fast them in Medicare.

“Paying one group of Medicare providers twice as fast as all the others will create a ‘stampede’ of other providers demanding the same treatment next year,” said PCMA President and CEO Mark Merritt.  “This will lead to billions in new Medicare costs, make fraud, waste, and abuse tougher to detect, and offer no benefit whatsoever to seniors.”

Meanwhile, the drugstore lobby’s own study[1] confirms that they are already being paid within 30 days. Three separate but remarkably consistent studies highlight that PBMs are paying claims on time.

• Grant Thornton study (the drugstore lobby’s own study) that shows pharmacies are being paid within 30 days (See Page 15 for findings on average payment time). 
• Part D claims are being paid within 21-25 days, according to the Centers for Medicare & Medicaid Services. 
• Part D claims are paid within 23 days, according to PricewaterhouseCoopers (PwC).

Legislation that would make Medicare prescription drug plans (PDPs) pay drugstores twice as fast as Medicare pays other providers could cost the program and its beneficiaries at least $3.3 billion over the next decade according to a new study by PwC.   Medicare PDPs pay pharmacy claims within 30 days, a standard consistent with Medicare Parts A & B, the federal employees’ health plan, and the private sector. The 30-day payment standard allows plans to batch claims for administrative efficiency and conduct audits to detect fraud and abuse.

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PCMA is the national association representing America’s pharmacy benefit managers (PBMs), which administer prescription drug plans for more than 210 million Americans with health coverage provided through Fortune 500 employers, health insurance plans, labor unions, and Medicare Part D.

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[1] “National Study to Determine the Cost of Dispensing Prescriptions in Community Retail Pharmacies,” Grant Thornton, February 23, 2007 (Page 15 of 18).

Grant Thornton Study

New PCMA ‘Prompt Pay’ Ad

HHS Secretary Mike Leavitt, Senator John Kerry, and the founder of the Center for Health Transformation Newt Gingrich addressing PCMA/RxHub’s recent E-Prescribing Symposium.

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