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Associated Press
a day ago
- Business
- Associated Press
ASCP and NCPA Announce Joint Recommendations to Manufacturers to Effectuate Medicare's Maximum Fair Price (MFP)
ALEXANDRIA, VA / ACCESS Newswire / June 13, 2025 / The American Society of Consultant Pharmacists (ASCP) and the National Community Pharmacists Association (NCPA) have announced joint recommendations to pharmaceutical manufacturers aimed at helping to support pharmacies facing material cash flow concerns under Medicare's Drug Price Negotiation Program (MDPNP). The two organizations, both of which represent pharmacists committed to high-quality care for all patients including Medicare beneficiaries, expressed concerns about the impact of the MFP, which is part of the Medicare Drug Price Negotiation Program (MDPNP). This was included in the Inflation Reduction Act of 2022 and enables Medicare to directly negotiate the prices of certain single-source medications without generic or biosimilar competition. CMS selected 10 drugs for an initial round of negotiations in 2023. These included medications for diabetes, heart failure, and peripheral artery disease. These negotiated prices, the highest that a Medicare Part D beneficiary or plan sponsor will have to pay for targeted medications, are slated to go into effect on January 1, 2026. While ASCP and NCPA fully support ensuring fair medication prices for Medicare beneficiaries, an analysis conducted for NCPA found that under MFP, pharmacies may face manufacturer refund payment delays of more than 21 days, beyond the 14-day Medicare prompt pay standard. At the same time, pharmacies could lose nearly $11,000 in weekly cash flow and $43,000 annually. Over 93% of independent pharmacies surveyed by NCPA state they may not be able to stock some medications targeted for price reductions because of cash flow and reimbursement below cost; and most LTC pharmacies anticipate closures, staff layoffs, service reductions, and medications shortages stemming from the MDPNP. Pharmacists at greatest risk for these negative impacts include sole proprietors in rural and urban areas, pharmacies that heavily rely on prescription revenue, and long-term care pharmacies. To address these concerns, ASCP and NCPA made several key recommendations to manufacturers, including the following: 'Most independent pharmacies and long-term care pharmacies care for populations that are heavily dependent on Medicare. It's critical that they are compensated in a fair and timely manner. Otherwise, they will face massive cash-flow problems and not be able to provide prescription services to their Medicare patients. A recent NCPA survey found that 93 percent of independent pharmacists would consider opting out of the program unless those concerns are addressed. That would be a disaster for Medicare beneficiaries and the program itself,' said Doug Hoey, NCPA's CEO. 'The IRA presents unprecedented threats to long-term care pharmacy as well as new opportunities to build a constructive, transactional relationship between pharmacists and manufacturers,' said Chad Worz. 'In developing and presenting these recommendations, we are hoping to send a fair and equitable framework that rekindles the historical partnership between pharmaceutical manufacturers and pharmacies. This, first and foremost, benefits patients while also protecting the sustainability of pharmacies and innovators. We look forward to continuing our constructive conversations with impacted manufacturers.' ASCP and NCPA urge manufacturers to incorporate these recommendations into their MFP effectuation plans by September 1, 2025, ensuring pharmacies remain viable and patients retain access to essential medications. About ASCP: The American Society of Consultant Pharmacists (ASCP) is the only international professional society devoted to optimal medication management and improved health outcomes for all older persons. ASCP's members manage and improve drug therapy and improve the quality of life of geriatric patients and other individuals residing in a variety of environments, including nursing facilities, sub-acute care and assisted living facilities, psychiatric hospitals, hospice programs, and home and community-based care. About NCPA: Founded in 1898, the National Community Pharmacists Association is the voice for the community pharmacist, representing over 18,900 pharmacies that employ more than 205,000 individuals nationwide. Community pharmacies are rooted in the communities where they are located and are among America's most accessible health care providers. Contact Information Melissa Blacketer Senior Director of Communications [email protected] 703-739.1311 SOURCE: ASCP press release
Associated Press
30-01-2025
- Business
- Associated Press
New Analysis Finds the Medicare Drug Price Negotiation Program Threatens Financial Stability of American Pharmacies
Today, the National Community Pharmacists Association released a first-of-its-kind analysis, Unpacking the Financial Impacts of Medicare Drug Price Negotiation, conducted by 3 Axis Advisors. The report concludes that the Inflation Reduction Act's Medicare Drug Price Negotiation Program (MDPNP) exposes small and independent pharmacies to significant financial risk, potentially disrupting seniors' access to essential medications and services. The analysis warns that the implementation of the MDPNP represents a fundamental shift in pharmacy operations and reimbursement practices for many of Medicare's most widely used prescription brand medicines. Under the MDPNP, pharmacies face lost revenue and significant disruption in cash flow — without adequate protection to help absorb these changes. Findings from the analysis further revealed that these policy changes will result in: Payment delays: Pharmacies will face prescription payment settlement delays of at least seven additional days for negotiated drugs, exceeding current Medicare Part D prompt pay requirements. Weekly cash flow shortfalls: Each pharmacy stands to lose nearly $11,000 in weekly cash flow due to delayed payments. Annual revenue losses: Pharmacies could forfeit an average of $43,000 in annual revenue — roughly equivalent to a pharmacy technician's yearly salary. These financial impacts could lead to significant consequences, such as pharmacy closures, reduced medication availability and staffing cuts, ultimately causing disruptions for seniors at the pharmacy counter. The financial disruptions come at a time when community pharmacies are closing at an unprecedented rate. Over 7,000 pharmacies have closed in less than 10 years. Furthermore, as explored in the analysis, 340B covered entities may have less revenue available for charitable care or expanded health care services (i.e., dental care) as a result of the MDPNP. Additionally, while 340B contract pharmacies may receive a fixed amount per 340B prescription, the reduction in revenues may result in reduced dispensing fee payments or carveouts (i.e., removal of MFP drugs from 340B relationships between covered entities and contract pharmacies). 'Like many government programs, the intent is good, but the unintended consequences undermine the goal,' said NCPA CEO B. Douglas Hoey, pharmacist, MBA. 'That's exactly the case here. Everyone wants to reduce drug costs for seniors and taxpayers. But, as our research shows, the program is structured in a way that will force many independent pharmacies out of the Medicare Part D program. Drug costs may come down, but there will be a shortage of pharmacies to dispense medicine. Seniors will be stranded without a pharmacy, and they won't get the benefit of lower drug prices.' The MDPNP was introduced under the Inflation Reduction Act of 2022 with the stated goal of lowering Medicare prescription drug costs. The program grants Medicare the authority to directly negotiate prescription drug costs with drug manufacturers for a select number of high-cost drugs covered under Medicare Part D (outpatient drugs) and, later, Medicare Part B (physician-administered drugs). Medicare has already completed negotiation for the first 10 medications whose prices, known as the Maximum Fair Price (MFP), will take effect Jan. 1, 2026. As established by the Inflation Reduction Act, additional drugs will be subject to negotiation each year. Earlier this month, the Centers for Medicare & Medicaid Services announced the 15 drugs that will be subject to negotiation in 2027. However, expanding the list of MFP drugs is already raising concerns for pharmacies, as a recent NCPA member survey revealed that 93.2 percent of independent pharmacies are either considering not stocking or have already chosen not to stock one or more of the first 10 drugs included in the MDPNP. Unpacking the Financial Impacts of Medicare Drug Price Negotiation emphasizes that pharmacies bear significant financial strain under this policy. The analysis offers several recommendations for pharmacies to mitigate risks, including establishing short-term financing solutions, closely monitoring manufacturer settlement timelines, and proactively adjusting liquidity and financing strategies — none of which address the fundamental flaws in the program's design. With the program set to take effect at the start of 2026, implementation is already underway across all the implicated stakeholders, including pharmacies. Accordingly, NCPA strongly urges the new administration and Congress to immediately freeze implementation until robust safeguards are in place to protect both pharmacies' financial viability and seniors' access to essential medications. About Unpacking the Financial Impacts of Medicare Drug Price Negotiation Unpacking the Financial Impacts of Medicare Drug Price Negotiation was developed by 3 Axis Advisors, with funding from NCPA, to assess the financial and operational impact of the Medicare Drug Price Negotiation Program, as enacted by the Inflation Reduction Act, on pharmacies. The findings highlight the urgent need for reforms that protect pharmacies — especially smaller, community-based businesses — and ensure they can continue to provide critical health care services to seniors. You can read the full analysis here and executive summary here. Founded in 1898, the National Community Pharmacists Association is the voice for the community pharmacist, representing over 18,900 pharmacies that employ more than 205,000 individuals nationwide. Community pharmacies are rooted in the communities where they are located and are among America's most accessible health care providers. To learn more, visit About 3 Axis Advisors 3 Axis Advisors is an elite, highly specialized consultancy that partners with private and government sector organizations to solve complex, systemic problems and propel industry reform through data driven advocacy. With a primary focus on identifying and analyzing U.S. drug supply chain inefficiencies and cost drivers, 3 Axis Advisors offers unparalleled expertise in project design, data aggregation and analysis, investigative research, and public education. 3 Axis Advisors arms clients with independent data analysis needed to spur change and innovation within their respective industries. To learn more about 3 Axis Advisors LLC, visit. Copyright Business Wire 2025. PUB: 01/30/2025 11:25 AM/DISC: 01/30/2025 11:25 AM
