Retail News Breaks
NACDS, NCPA drop Medicaid AMP lawsuit
December 14th, 2010
ALEXANDRIA, Va. – The National Association of Chain Drug Stores and the National Community Pharmacists Association are dropping their 2007 lawsuit that has blocked the implementation of the so-called "AMP rule" by the Centers for Medicare & Medicaid Services (CMS).
In a joint statement Tuesday, NACDS and NCPA said they have agreed with CMS on a motion to dismiss the Medicaid average manufacturer price (AMP) suit in the wake of the agency's withdrawal last month of the remaining provisions of the AMP rule, which had been halted by an injunction following their litigation.
The CMS final rule approved in early November removes provisions that define AMP, determine the calculation of federal upper limits (FULs) and define a "multiple-source drug." Those provisions relate to the reimbursement to pharmacies for generic Medicaid prescriptions and, in turn, affect patient access to pharmacies.
"Today marks a vital triumph for pharmacy and patients. The agreement of CMS to stop applying federal upper limits to all B-rated drugs after Dec. 15 and to refrain from publishing AMPs calculated under the old AMP rule are the final steps that will allow the AMP lawsuit to be dismissed," NACDS president and chief executive officer Steve Anderson and NCPA executive vice president and CEO Kathleen Jaeger said in the joint statement. "Also effective Dec. 15, CMS is formally withdrawing provisions of the AMP rule related to the definition of AMP, calculation of FULs and the definition of 'multiple-source drug,' which was another victory for patient care.
"Combined with withdrawal of most of the AMP rule, these victories eliminate the need for the injunction that halted implementation of the AMP rule," Anderson and Jaeger stated. "Now that all of the issues raised in our AMP lawsuit have been resolved, there is nothing left to challenge at this time, and we are pleased to have reached agreement with CMS on a motion to dismiss the lawsuit."
The retail pharmacy associations noted that the injunction prevented "crippling cuts" in Medicaid pharmacy reimbursement amounting of $5.5 million per day, totaling roughly $5.75 billion from Jan. 1, 2008, to the present.
"These devastating cuts would very likely have created serious impediments for patients in accessing their medications and other pharmacy services. Patients are the clear winners in today's victory," NACDS and NCPA said.
"We look forward to continue working with CMS in the implementation of the new AMP provisions," they added, "and we will continue advocating energetically for sound public policy that provides access to quality pharmacy services for patients, which prevent more costly forms of health care over the long run."
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