Inside This Issue - Opinion
High court ruling on health reform only one step on journey
July 16th, 2012
The Supreme Court’s decision to uphold the Affordable Care Act provides a greater degree of certainty for retail pharmacy operators and other health care providers, but it is far from the final word on the legislation’s ultimate impact.
Don Bell, senior vice president of legal affairs and general counsel at the National Association of Chain Drug Stores, who has closely followed the progress of the Affordable Care Act as it moved through Congress and the courts, says many questions related to the legislation are yet to be answered. While the high court upheld the central funding mechanism of health care reform, the so-called individual mandate that requires people to obtain health insurance coverage or face a financial penalty, it decided states cannot be forced to participate in the expansion of the Medicaid program envisioned by the act.
“The Medicaid ruling creates a lot of unknowns,” notes Bell. “If a number of states should choose not to implement the provisions, millions of people who would otherwise have had coverage could fall through the cracks and, as a result, community pharmacies may not dispense as many prescriptions to those patients.”
On the plus side of the ledger, the action by the Supreme Court left intact the Affordable Care Act’s provisions related to average manufacturer price (AMP) and medication therapy management (MTM). The former promise to bring community pharmacy a more equitable system of remuneration for prescriptions filled under Medicaid (a critical consideration since the formula adopted by the Centers for Medicare and Medicaid Services, or CMS, is likely to influence the private sector), while the latter should bring the profession additional compensation for cognitive services.
The degree to which the law succeeds in achieving those goals depends on how the provisions are applied by CMS and other federal agencies, according to Bell.
“The statute itself is in the early phases of implementation,” he says, “and it’s not clear how most of the provisions in this massive and very complicated legislation will be put into practice. There are a lot of moving parts that the industry has to watch carefully, and when the need arises we have to be ready to respond.”
AMP is a good example. Retail pharmacy and the government have been engaged in a protracted battle, including a successful lawsuit filed in federal court by NACDS and the National Community Pharmacists Association over the definition of AMP.
Under the Affordable Care Act, CMS has issued a proposed AMP rule and draft federal upper limits (FULs). “There has been quite a bit of fluctuation in the FULs month to month, which is troubling,” notes Bell. “NACDS has submitted comments about how we think the rule can be improved. We’re now waiting to see what CMS does.”
Retail pharmacy will have to be watchful across a broad range of issues that could impact its future prospects. In addition to AMP, other parts of the Affordable Care Act that will affect the industry include plans to step up efforts to curb fraud and abuse, creation of a pathway for biosimilar medications, and a bid to bring greater transparency to the pharmacy benefits management market.
“We’re very engaged with policy makers at the federal and state levels,” says Bell. “At the end of the day, how legislation is implemented can have as big an effect as the legislation itself. NACDS is committed to being a forceful advocate for pharmacy every step of the way.”