ARLINGTON, Va. — NACDS is urging the federal Centers for Medicare & Medicaid Services (CMS) to fix yet another unworkable situation for pharmacies and for the patients who rely on them.  

In a letter, NACDS explains that while prescription drug discount cards help to reduce patients’ out-of-pocket costs, states are using data from these transactions in a way that is inconsistent with federal law and policy, and that drives down reimbursement to pharmacies for prescriptions that they fill in the Medicaid program. Without a remedy, NACDS says pharmacies may be financially unable to continue to accept third-party discount cards. 

At issue is the concept of “usual and customary pharmacy charges” – a measure of the prices charged to uninsured, cash-paying patients. State Medicaid programs rely on this measure of “usual and customary pharmacy charges” to ensure that they do not pay pharmacies more than cash-paying customers do for a drug. However, states have been using the evaluation of “usual and customary pharmacy charges” in ways not allowable under current laws and policies. Among them, states are including in the calculation of “usual and customary” the amount that users of third-party discount cards pay for a drug, which artificially lowers pharmacy reimbursement. 

NACDS President and CEO Steven Anderson explains in a letter to CMS, “Although consumers pay out of pocket when using third-party discount cards, the price returned to the pharmacy by the third-party discount-card operator during adjudication is not the price that the pharmacy usually charges the general public. The pharmacy only facilitates the lower prices made available by the third-party card operator to customers who present the card. Indeed, the pharmacy stands operationally and financially in the exact same position as it does with beneficiaries of other third-party payors, such as health insurers and governmental entities.” 

NACDS’ letter details federal laws, regulations and guidance that stand in direct opposition to the inclusion in “usual and customary” the pharmacy charges related to third-party discount cards. It also details the negative effects on patients of this practice. 

“Critically, if state Medicaid programs include third-party discount cards in calculations of [usual and customary], pharmacies may be financially unable to continue to accept third-party discount cards,” NACDS states. “For consumers on tight budgets who rely on third-party discount cards to pay for their medications, the potential loss of access to these discounted medications would be devastating. Elimination of an option that provides lower-priced medication to the underinsured and uninsured would directly contravene the Administration’s policy to promote affordable access to prescription drugs.” 

More information about NACDS’ pursuit of pro-patient and pro-pharmacy policies is available on the “Access Agenda” website.