Low Medicaid Reimbursements Hurt Pharmacists

Raquel Maria Dillon's picture
By Raquel Maria Dillon on Wednesday, March 31, 2004.
listen: Listen with Windows Media Player

Pharmacists across the state say they won't dispense prescriptions to new Medicaid patients because the state is not reimbursing them enough, and it's hurting their business. They want to send a message to lawmakers in Concord and officials at the Department of Health and Human Services. Advocates for the poor say this could affect vulnerable populations, and people who already have trouble getting essential medical services. New Hampshire Public Radio's Raquel Maria Dillon reports.

Tomorrow/This morning, the pharmacist on duty at Sullivan Drug says he'll come in bright and early. It's the first of the month and that means the small drug store will be busy all day. His story on Main Street in Lancaster has been a pharmacy since 1856. Today, it's owned and operated by David Rochefort and his father. Rochefort say the reduction in Medicaid reimbursement rates is hurting their business.
ROCHEFORT :07 if you call me in a year, and I'm not here and the store is closed. That'll probably have something to do with decision…

The Rocheforts recently decided to continue serving Medicaid recipients. Even though they say they lose money on every Medicaid prescription they fill.
The state Department of Health and Human Services recently cut Medicaid reimbursement rates for pharmacists. And many independent pharmacies are turning away new Medicaid patients, to protect their bottom lines and to send a message to the state.
ROCHEFORT :22 we're not in the position that we could turn away people. We're up close to 40% Medicaid up here. we feel it'd be doing a greater disservice to our neighbors – people we see every day, go to church with, and our kids go to school with – it would be hurting them more than sending message to Concord.

Manchester Community Health Clinic director, Ed George, says pharmacies that won't take new Medicaid patients are hurting a vulnerable population that already has trouble getting access to good health care.
GEORGE :07 it's probably going to create more access problems for Medicaid patients, I don't see how it couldn't.

Many independent pharmacists say if they continue to serve new Medicaid patients, they'll go out of business.
In January, the state lowered the reimbursement rate for dispensing drugs to Medicaid patients by almost four percent. That rate used to be 12-point-5 percent below the average wholesale price, now it's 16 percent – and the dispensing fee went from two dollars and 50 cents to a dollar-75.
David Minnis of the New Hampshire Pharmacists Association says pharmacists were already getting reimbursed less than their colleagues in other states.
MINNIS :25 When that rate was put in in 1996, it was the lowest rate paid to pharmacies in the entire country. NH pharmacists were paid the lowest, the bottom, 50 out of 50 as far as reimbursement was concerned. That rate had been in effect for 8 years and 4 commissioners.

Minnis says Health Commissioner John Stephen changed the rates without consulting the legislature or negotiating with pharmacists – as is required by law. A couple weeks ago, three pharmacists' organizations filed suit against the Department of Health and Human Services. Because of the lawsuit, H-H-S officials wouldn't comment. Governor Craig Benson's spokesman, Wendell Packard, says the Administration stands behind the commissioner.
PACKARD :19 this is an issue that Commissioner John Stephen has been on forefront with. it's his contention that pharmacists have been over-charging the state and state law says NH should receive best rate available. So he's pushing to insure that's what happens.

But Minnis with the Pharmacists Association says prescription drug prices fluctuate, and Stephen shouldn't punish all 223 of New Hampshire's pharmacies.
MINNIS :18 he arbitrarily lowers the reimbursement rate to all pharmacies throughout the state based on a sample of 15 stores taken … in March of last year. So he waits 9 months and arbitrarily lowers rate saying we're cheating the state. That's just not true.

Pharmacists say dispensing medication to Medicaid patients takes more time. Rochefort says he works closely with his Medicaid customers so they can afford their medications. He has one regular customer who takes 12 different medications, and she needs a lot of help stretching her money to pay for them.
ROCHEFORT :26 the state will not pay for any of her stuff until she pays out of pocket $164. So I'll come in early 'cuz it's the first of the month, look at all Rx, add what she needs, figure out what she needs most. Add up quantities… to come up with $164.

Then Rochefort compiles all of this customer's receipts, faxes them to the State, and 3-5 days later she'll be eligible to purchase the rest of her medications. He says they've worked it out so she doesn't go without essential drugs for those few days.
Rochefort says many Medicaid patients have multiple chronic conditions, so he has to pay close attention to avoid adverse drug reactions.
ROCHEFORT :14 people on Medicaid require more services to get same outcomes. we have to deliver medications, because they can't pick them up. have to counsel them in depth.

Rochefort says the lower reimbursement rate from the state means he's losing even more money serving Medicaid patients.
ROCHEFORT :15 we got it figured out to minute how much time we can spend before losing money. it doesn't take long. As result of these cuts, we're providing a community service, not making any money on these patients.

Rochefort complained to his local lawmakers and to the governor's office. He says a staffer there told him the lower reimbursement rate was only temporary, and he could appeal to DHHS for a new rate for his pharmacy. But he's worried that independent pharmacies will be forced out of business, and those with the least resources – Medicaid patients – will have to travel farther to find someone to provide their medications.
For NHPR News, I'm RMD.

Related news:

Thursday, July 10, 2008
State Offers Consumers Little Protection When They Buy Their Own Insurance

Wednesday, July 2, 2008
Some New Hampshire Residents Turn to Massachusetts for Psychiatric Crises

Thursday, June 26, 2008
NH Vets Gripe About Traveling to Boston for some VA Healthcare, but Vets Elsewhere Travel Greater Distances

Related shows:

Thursday, July 24, 2008
Predicting Suicide

Tuesday, July 22, 2008
Tuesday's Show

Tuesday, July 15, 2008
Taking Our Daily Meds

NPR News