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NACDS backs bill encouraging generics in Medicaid
July 25th, 2011
ALEXANDRIA, Va. – The National Association of Chain Drug Stores is supporting legislation that would give states incentive to use generic drugs for Medicaid patients to achieve savings.
NACDS said Friday that it has sent a letter of support to the sponsor of the Affordable Medicines Utilization Act of 2011 (S. 1536), Sen. Scott Brown (D., Mass.) and the co-sponsors of the bill, Ron Wyden (D., Ore.) and John McCain (R., Ariz.). The legislation would give states 50% of the share of generated savings in cases where a state has a rise in the generic utilization rate for fiscal years 2012, 2013 and 2014.
The association noted that community pharmacy has the best track record when it comes to fostering the use of generic medications.
"Pharmacies have long promoted generic drugs as safe, cost-effective alternatives for many patients. Substituting generic pharmaceuticals for their brand-name equivalents or other brand name drugs within the same drug classes is a cost-effective way of achieving Medicaid savings," NACDS stated in the letter.
"Community pharmacies are leading the way to maximize the appropriate use of generic
drugs. Community pharmacy has a higher rate of generic dispensing — 71% — than any
other practice setting, including mail order pharmacy. In calendar year 2010, the generic
dispensing rate increased by 3.8% from 2009. For every 1% increase in generic utilization, the Medicaid program could save approximately $809 million," the letter said.
Still, NACDS cautioned against evaluating spending on prescription drugs in a vacuum. The association stressed that pharmacist-patient interaction can help prevent more costly forms of health care in other areas.
"We believe that there are many best practices that could be put in place to reduce Medicaid spending, while at the same time allowing Medicaid patients to continue to use the pharmacy of their choice. Medicaid programs generally have a good generic dispensing rate, but greater savings could be achieved by encouraging or mandating more aggressive prescribing of generic drugs," NACDS said in the letter.
"The Affordable Medicines Utilization Act of 2011 will provide incentives that will encourage state programs to efficiently use their health care dollars through increased use of more cost-efficient generic drugs while at the same time generating savings for not only the state but for the patient as well."
On Thursday, NACDS submitted comments to the Senate Special Committee on Aging that highlighted the value of the pharmacist-patient interaction in helping improve health care outcomes and reducing costs in Medicare, particularly through better medication adherence. The association submitted its comments for the committee's hearing, "A Prescription for Savings: Reducing Drug Costs to Medicare."
"Pharmacists play a key role in helping patients take their medications as prescribed and offer a variety of pharmacist-delivered services, such as medication therapy management (MTM), to improve quality and outcomes while reducing overall costs at the same time," NACDS stated in its comments.
"Pharmacists help patients every day by counseling on proper use of medications, checking for possible side effects, drug interactions or allergies, and helping to coordinate insurance benefits," the association explained.
NACDS urged the committee to support the Medication Therapy Management Empowerment Act of 2011 (S. 274), which aims to boost access to pharmacy services for Medicare beneficiaries. The comments also noted how greater use of generic medications could promote cost savings in Medicare.
"Increasing the rate at which generic pharmaceuticals are substituted for their brand-name equivalents or other brand-name drugs within the same drug classes is a cost-effective way of achieving Medicare Part D savings," NACDS said in its comments. "By providing medication therapy management, increasing medication adherence and promoting and increasing the use of generic medications, pharmacies and pharmacists continue to increase the health care quality and outcomes for Part D beneficiaries while at the same time reducing overall program costs."