New Year, New Tricks

Numerous legislation and regulations have been implemented across a variety of states, creating an entirely new field of options that have yet to be discovered.  Historically, this means a new funding method, audit recoupment policies, “updated” procedures, or entirely new practices that had not been seen or interpreted prior…  There are a variety of factors playing into these new regulatory changes, so it will be interesting to see how these affect your local healthcare access.

One interesting new component that has arisen this year for Medicare recipients includes your pharmacy being paid directly through Medicare a portion of reimbursed items for medications as part of rebate structure.  In the past, all rebates were afforded to Medicare (CMS) directly, and then utilized to offset PBM invoices for the medications.  However, as an attempt to include direct payments for the medication(s) included in this negotiation, it has been determined that PBM’s and patients will pay a specific portion of the medication cost (patient up front, PBM anytime in the coming week to month after picking up your medication), and prayerfully this new program operates well and the rebates are paid to the pharmacy within the couple of weeks to couple of months following the pickup.

A few concerns exist, however, with this model.  First, nobody knows exactly how it is going to work…  This is an entirely new concept that has never been operated before.  How long will it take to enact the policies, work out any “kinks” and ensure proper payment to pharmacies in a timely fashion to keep them from bankrupting due to the extreme costs involved with the current medication list on this program…  Secondly, if we experience another government shutdown like we had the end of 2025, since the agreed budget was only approved through January 2026, will the program continue to function and pay pharmacies appropriately, or will that potential shutdown also show no payments to pharmacies (who have to pay for the medications within 2 weeks on average of purchase date, not prescription processing date).  Thirdly, as prices change on these medications (which commonly occurs on average 2 to 3 times every year), how long will these negotiations take to reflect those changes with either the PBM or the CMS rebate system?

These sort of intricacies are what drive the business of retail pharmacies today – constantly chasing the payments for medications to sit on our shelves to ensure we have it ready when somebody is prescribed new prescriptions or if something happens and somebody forgets to order ahead of time.  In other words, an average pharmacy has hundreds of thousands of dollars of medication sitting on the shelf at any given time, paying for all of it within 2 weeks of ordering, and praying for PBM’s and government programs paying for the processed prescriptions to pay in a timely fashion that covers the costs of purchasing medications, much less payroll and the numerous overhead expenses…