Bartell Drugs plans to discontinue filling Medicaid prescriptions at 15 of its 57 stores, citing recent reductions in compensation from Washington state.


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Bartell to stop filling Medicaid prescriptions at some stores

January 7th, 2010

SEATTLE – Bartell Drugs plans to discontinue filling Medicaid prescriptions at 15 of its 57 stores, citing recent reductions in compensation from Washington state.

The drug store chain said Thursday that it will stop providing Medicaid prescriptions in 12 King County and three Snohomish county, effective February 1.

Bartell Drugs noted that on September 26, 2009, the industry pricing standard was cut following a court decision in Massachusetts in the First DataBank and Medi-Span case. The decision meant that effective on that date, average wholesale prices (AWPs) of drugs paid to pharmacies would be reduced to 120% of the wholesale acquisition cost (WAC).

George Bartell, chairman and chief executive officer of Bartell Drug, explained that unlike most other insurance providers including other states, the Washington State Department of Social and Health Services (DSHS) has made no effort to offset that reduction, resulting in sizable reductions in payments to pharmacies.

Bartell said lengthy discussions between pharmacy industry leaders and DSHS, along with subsequent legal actions, have failed to resolve the pharmacy reimbursement issue and that the intent is merely to return to the established level of compensation before the September 26 court action.

"We want to fill prescriptions. Bartell Drugs is here to serve our customers — to fill their prescriptions and meet their health care needs, and we feel we do a good job offering outstanding patient care," he said in a statement. "Accordingly, this is a painful decision and one we do not take lightly. We want to be clear that the decision has nothing to do with our DSHS customers but only with the state. We look forward to serving these customers any other way we can."

"I can't speak for other pharmacies across the state, but we hope that the state will reconsider their reimbursement and meet its responsibility to provide access to all Medicaid recipients," Bartell added. "Our sincere hope is that this issue will be resolved so we do not need to expand our exclusion of DSHS prescription services to additional locations."

The National Association of Chain Drug Stores and the Food Marketing Institute (FMI) were among the retail pharmacy groups warning that the Medicaid pharmacy reimbursement cuts could have devastating consequences for drug retailers.

In comments to Chain Drug Review on the 2010 retail outlook for the chain drug industry, Bartell cited the reimbursement issue as one of the big concerns for the pharmacy sector.

"Our state [Washington] is one where NACDS, in conjunction with the state pharmacy association, has filed a lawsuit to stop a Medicaid reimbursement rate cut," Bartell told Chain Drug Review. "Right now we're filling Medicaid prescriptions below our operating cost, and we can't continue to do that."

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