Month: January 2016

Changing Tides

The paradigm change occurring in the practice of pharmacy has been a regular topic of this blog. But the Thriving Pharmacist is not the only one talking about the importance of pharmacists participating in a new care centered model. Randy Dotinga, with Drug Topics echoes many of the same themes in his recent article : Care delivery key to nex-gen pharmacy success.

Independent pharmacies are not the only ones looking to differentiate themselves to prepare for this new model. A recent article in Chain Drug Review: 2016 Retail Outlook: Pharmacy’s reach to expand,  reports the thoughts of several leaders in a variety of chain drugstores on the same topic.

Change is coming. Be ready. Start now, and make every encounter count.

The Flip Side of Access to Lives

Previously, we have written that access to lives is important to any pharmacy, and the narrow, preferred networks that have become vogue in Medicare Part D are an example of an outside influence that can impact this access. The theory, of course, is that being in a narrow network will drive patients to a participating pharmacy, thereby increasing its business. The decrease in reimbursement that accompanies preferred status is theoretically offset by the pharmacy’s ability to generate the revenue from these new patients. But does this theory withstand scrutiny? Continue reading The Flip Side of Access to Lives

Pharmacy Street Blues

It may not be at the top of the list of things people consider when they think about what a pharmacist does all day, but one important, and over-looked aspect of the profession is a form of law enforcement. Specifically, pharmacists are constantly on the look-out for drug seekers and forged controlled substance prescriptions. Criminals are becoming more and more sophisticated in their attempts to secure controlled substances without a valid prescription, and today’s blog is going to describe some of the challenges pharmacists need to be ready to embrace.

Drug Seekers

One of the more common problems encountered is the drug seeker. Most of the time, these present as a patient with an otherwise valid prescription for a controlled substance. The problem is that the person is using many different doctors and many different pharmacies. Spotting a drug seeker is generally not very difficult as long as the pharmacy has proper training and policies in place. These often present as new patients to a pharmacy who request a cash price for the controlled substance.

When presented with a potential seeker, pharmacists and pharmacies should check the state registry for a controlled substance dispensing history (sometimes called a PMP for Prescription Monitoring Program). These lists, while often a week or so behind, quickly reveal multiple pharmacies, physicians and insurance / cash histories.

Once a problem is identified, however, pharmacists are confronted with an even more difficult task: what do you do? The answer is far from trivial, because there is likely a real medical issue being treated alongside physical dependence to the controlled substance(s). A pharmacy may elect to refuse to fill a prescription in this cases, but that does not address the underlying problem. It just moves the patient to a different pharmacy or pharmacist. A better approach is to speak with the patient about their issue and then send a short clinical note to each of the recent prescribers alerting them to issue, directing them to the PMP for details. The goal is to get all of the prescribers on the same page and have one prescriber and pharmacy manage the patient. Addressing the root of the problem takes effort and fortitude.

Criminals

Less common, and far more difficult, are forged prescriptions. Criminals are becoming amazingly sophisticated with their tactics, making the job of the pharmacist recognizing an invalid controlled substance prescription increasingly difficult every day. The criminals plan carefully, usually targeting a pharmacy at a busy time or just before closing, trying to catch the staff in a hurry. Spotting a forged prescription is an art. The pharmacist relies on many different pieces of information to spot a fake, but don’t look for me to publish a list. The last thing we want to do is make it easier for criminals to fool the pharmacist. Instead, I will detail several common tactics:

  • A out of town or out of state doctor.
  • Trying to fill the prescription after the physician’s office is closed, making contacting the prescriber inconvenient or impossible
  • Coupled prescriptions: presenting one controlled and one non-controlled prescription together to make them both appear more legitimate.
  • Someone other than the patient on the prescription presents the prescription and wants to pick it up.

If a prescription is not passing the sniff test, the pharmacist has to make a choice of what to do next. My first advice is to trust your gut. When it doubt, consider the prescription suspect and do not fill it.

The law does not necessarily cover what a pharmacist can, and cannot do in these circumstances: we are generally left to figure this out on our own. The advice of the thriving pharmacist is this:

  1. Request the identification (photo ID) of the person requesting the prescription to be filled. Make a photocopy of this information in case the prescription is determined to be fake.
  2. Stall. Tell the person the pharmacist needs to verify the prescription and it will not be released until that has been complete. This may not be possible until the next business day when the prescriber’s office opens.
  3. Do not risk your safety. Starting with the items below, the situation could become risky. It is in your best interest to call the police now and alert them to a possible situation. It cannot hurt to have the local law enforcement nearby or even at the store.
  4. Do not relinquish the suspect prescription to the patient until it is verified as valid by the prescriber. If the patient demands the prescription back before this, suggest the local law enforcement stop by to discuss the problem. (They may even be outside by this time if you followed step 3)
  5. If the person actually waits for the police to arrive and discuss, the prescription may actually be real, and you should follow the advice of the officer(s), returning the prescription if directed to do so.
  6. Provide all information to the police, including information obtained from a verification check and any video surveillance if available.
  7. Report the incident to your local PMP or state board. Many states maintain a mailing list alerting pharmacies to current threats.

The Rubber and the Road

Neither of the above scenarios are easy to handle, and either can become dangerous. Physical dependence and criminal intent can be a tricky combination. Each issue presents its own set of challenges, and successfully foiling a scam may mean the pharmacist has to testify in court. This is an important part of the profession: a part that does not involve any reimbursement–but should.

In the words of Sergeant Esterhaus (Hill Street Blues):  Let’s Be Careful Out There. Make every encounter count.

Down Under

When a pharmacy loses money on a drug because the PBM’s MAC price is below the pharmacy’s best available product acquisition cost, it is generally described as “underwater.” Often today, generic drugs see abrupt and unexpected price increases. These increases are sometimes unbelievable, with a product’s acquisition cost potentially increasing by hundreds of percent overnight. When this occurs, and the MAC price does not represent a reasonable acquisition cost, the pharmacy requests a MAC price review. In some states (like Iowa), the PBM has a finite amount of time (just a few days) to address the problem.

A person not familiar with the inner workings of a pharmacy might underestimate the significance of this issue. I thought it might be interesting to publish a few numbers from my Pharmacy Services Administrative Organization (PSAO). Any given drug product (with a unique NDC) can be underwater with one or more PBMs. Our PSAO, on behalf of all the pharmacies it represents, submits claims it deems significantly underwater to each PBM. Note that this does not represent all underwater claims, just those that lose a significant amount of money for a significant fraction of all of the pharmacies represented by the PSAO. In other words, the reported number below is on the low side.

By the Numbers

  • Underwater MACs reported to PBMs by our PSAO for 1 week: 5593
  • Responses received from PBMs (any response at all): 188
  • Responses that decreased the MAC price: 2
  • Responses that specified an increase the MAC price: 104*
  • Responses without specifying an increase: 82
*It should also be noted that an increase in MAC does not necessarily guarantee that the new price is actually profitable for the pharmacy.

The response rate for the week is about 3%, and is very disappointing. Pharmacies expect a better response rate from PBMs. Without an ability to act together, pharmacies are at the mercy of the PBMs to police their own MAC lists fairly.

About 2 years ago, many states began contemplating rules to regulate the PBM industry. In Iowa, these rules passed both the houses of the legislature unanimously. The rules, however were not sufficient, as they did not have significant consequences for the PBMs if they were non-comlpliant. Since that time, the rules in Iowa have been stiffened and several other states have added their own legislation. I am not aware, however, of any real positive outcomes from any of these State rules. The PBM industry continues to operate in a business as usual manner.

Unfortunately for pharmacists and pharmacies, the general public has difficult time comprehending the complicated relationship between the PBM industry and their pharmacy. Recently, however, there has been significant scrutiny from the US House of Representative and some media outlets on the business tactics of the PBM industry. The House Judiciary Committee Hearings shed some much needed light on the practices.

What is needed is federal rules to hold the PBM industry accountable, especially with respect to MAC pricing. These rules should be simple and the consequences for failing to abide to them should be significant. Rules might include:

  1. MAC price should be based on current, actual acquisition prices available to pharmacies in a given region. Prices should be updated daily.
  2. Contracts between PBMs and Pharmacies should be required to allow the pharmacy to make a reasonable profit. This means that either:
    • MAC price includes a real profit component that reflects the actual cost of dispensing in a region [1] or…
    • An additional professional fee for service be associated with each prescription claim. This is not the dispensing fee already being paid (ranging from as low as $0 to a high of $1.50).
  3. PBMs that also run pharmacies cannot give different contract terms to pharmacies they own or run.

States have found that consequences for non-compliance to be the problem with enforcing their rules: PBMs claim that that State rules don’t apply for Medicare Part D plans. By making federal rules regulating the PBM industry, this argument becomes moot. Consequences for non-compliance could, for example, put the PBM at risk of disqualification from future participation in Medicare Part D.

Pharmacy needs to come together and form a grass-roots campaign to bring PBM reform to congress. It will not be easy. The PBM industry has a lot of money and influence. Recent revelations during the House Judiciary Committee have given pharmacy an opening to press forward. Now is the time. Make your voice heard!

[1] Notes on the cost of dispensing: In the Iowa, the State Medicaid program leverages a state-wide survey of pharmacy expenses (essentially Profit / Loss balance sheets from pharmacies across the state are provided to a third party consultant firm) to determine the actual cost to dispense a prescription in the state. Currently, the fee paid by this program is $11.73/rx, which includes a margin for profit.