Government Affairs Update - Week Ending August 28th, 2010

National Community Pharmacists Association (NCPA)

PBM Reform: The Next Steps: H.R. 5234, the PBM Audit Reform and Transparency Act of 2010 was recently introduced by Reps. Weiner (D-NY) and Moran (R-KS).  This legislation expands the new PBM transparency requirements included in the health care reform bill to all plans both public and private plans.  It is also the first federal legislation to try and reform PBM’s abusive auditing practices. 

DME Accreditation Exemption and Competitive Bidding: H.R. 5235, the Medicare Access to Diabetes Supplies Act was recently introduced by Reps. Welch (D-VT) and Rogers (R-MI).  This legislation would exclude diabetic supplies provided by small pharmacies from DME competitive bidding.  The bill defines small pharmacies using the SBA definition of $7 million or less in annual sales. Excluding these supplies from competitive bidding is important for small pharmacies because they will unlikely be able to effectively participate in the competitive bidding program. That will reduce beneficiaries' access to diabetes testing supplies.

Pharmacy Exemption from DME Competitive Bidding Program: This week a bipartisan group of U.S. Representatives - Mike Rogers (R-MI), Zack Space (D-OH), Lee Terry (R-NE) and Peter Welch (D-VT) – sent a letter to the Centers for Medicare and Medicaid Services (CMS). The letter urges them to keep retail pharmacies out of the competitive bidding program for diabetes test supplies and asks them to keep prices for its national Competitive Bidding Program (CBP) for Medicare Part B mail order diabetes testing supplies (DTS) separate from similar supplies offered by retail pharmacies.  Retail pharmacies were exempted from the latest round of competitive bidding, but NCPA continues to work to get this exemption into permanent statute. A copy of this letter can be found on the NCPA website. NCPA also met with senior staff of the House Ways and Means Committee and Senate Budget Committee about this issue.

Senate action on Elimination of 1099 Tax Requirements: NCPA continues to work closely with NFIB and its coalition stakeholders to repeal or narrow the expanded 1099 reporting requirements for small business under the new health care reform legislation.  The provision would require businesses to provide a 1099 form to any entity from which they purchase more than $600 in goods and services, starting in 2012.

Two bills were introduced earlier this year that would eliminate the new 1099 requirement.  The Small Business Paperwork Mandate Elimination Act has 23 cosponsors in the Senate (S. 3578, introduced by Senator Johanns, R-NE) and 160 cosponsors in the House (HR 5141, introduced by Representative Lungren (R-CA).

Senator Johanns’ legislation will be voted on as an amendment to a Small Business Jobs Bill when the Senate returns in mid September. Another amendment offered by Senator Bill Nelson (D-FL) will also be voted on. This amendment would exempt payments made by credit or debit card.  It also increases the payment threshold to $5,000 (up from $600) for the year for payments made for property (i.e. goods). Second, small businesses with 25 or fewer employees would not have to issue a form 1099 for payments made for property, regardless of the payment amounts.

The efforts to repeal this requirement appear to be picking up steam as Senate Democrats acknowledge this issue will have to be addressed when Congress returns in the fall. NCPA is supporting a repeal of the 1099 requirements because of the burdens they will place on small pharmacies.   

Meeting on TRICARE Generic Drug Reimbursement: NCPA leadership and staff met this week with the chief of DoD’s TRICARE pharmacy program to voice concerns about the recent cuts to TRICARE prescription reimbursements.  DoD is very interested in this issue and have promised that they will closely look into this matter.  They were also interested in hearing suggestions on more efficient, cost effective model.  NCPA is still interested in hearing if pharmacies have seen a recent sudden drop in generic reimbursement. We do not want specific reimbursement rates, just information about whether rates have changed.

Medicare Part D MTM Changes: NCPA had a call this week with CMS officials regarding the Medicare Part D MTM program and changes for 2011.  We also discussed CMS plans for implementation of the Part D MTM provisions in health care reform legislation, including a standardized documentation format for patients to better understand how to take their medications, and the utilization of telehealth MTM services.  CMS clarified for NCPA that the HCR MTM provisions go into effect on January 1, 2013 and proposed regulations (expected in a few weeks) are required to implement HCR changes. These will include proposed clarification of how beneficiaries would qualify for MTM if they don’t necessarily meet the MTM eligibility requirements but have experienced a transition in care.  MTM programs for 2011 are already reviewed and approved and changes that were first implemented in 2010 related to the dollar threshold (i.e. likely to incur $3,000 or more in Part D drug spending), etc still apply for 2011 and have not been altered. 

Medicare Part B Changes: On August 24, NCPA submitted comments on CMS’s proposed rule regarding the Medicare Part B program for 2011.  In our comments, NCPA is requesting that CMS incorporate a number of changes to its final rule governing the Part B program.  More specifically, NCPA is requesting that CMS continue its plan to exclude community pharmacists from all current and future competitive bidding programs (CBP) for diabetic testing supplies (DTS), as well as exclude community pharmacists from future CBP’s for off-the-shelf (OTS) orthotics and all other durable medical equipment (DME) supplies.  Not only is NCPA asking CMS to continue to exclude our members from CBP, but we are also asking CMS to promulgate regulations protecting NCPA members from the cut-rate pricing resulting from the CBP.