CMS proposes guidelines for DIR data reporting
In early June, CMS released proposed guidance for Medicare Part D reporting for DIR data for 2016. Plan sponsors are now required to report price concessions from pharmacies and incentive payments provided to pharmacies, making it easier for CMS to verify the accuracy of reported data and for pharmacies to determine how fees break out.
The guidance also updates the definition of “negotiated price” so that only payments not determined at POS can be considered DIR fees.
NCPA would like guidelines to go a bit further, requiring Part D plan sponsors to explain why certain fees cannot be determined at POS. “PBMs say fees cannot be approximated at POS but we disagree; anything can be,” Hauser says.
NCPA anticipates that CMS guidance will require plans/PBMs to reflect the fees in the adjudication process so that pharmacies will know their real reimbursement rate. “We are advocating for greater transparency so we will know how fees are determined when contracts begin and when they are actually assessed,” Hauser says.
Specialty pharmacy adds fuel to fire
Community pharmacies are not the only ones expressing strong objections to DIR fees. “Each year, PBMs have increased the price they pay to pharmacies for a drug at the time of dispensing and then applied performance-based metrics, which are not based upon measures relevant to specialty pharmacies or that we can impact,” says Rebecca Shanahan, CEO of Avella Specialty Pharmacy and president of the National Association of Specialty Pharmacy (NASP).
“Seventy-five percent of performance fees are based upon metrics related to cholesterol, diabetes and hypertension—commonplace disease states for which we do not dispense medications. These ‘clawbacks’ are equal to or greater than the upfront reimbursement increases,” she says.
PBMs set the reimbursement they will pay pharmacies for the drugs they dispense and over the past three years, they have created performance-based pharmacy fees that were initially $1 or $2 per prescription but that have ratcheted up to 10% discounts off the cost of specialty drugs, says Shanahan.
She contends that PBMs retain 30% of discounts they apply at the point of dispensing and 65% of discounts they collect after dispensing drugs—even for patients who have not received drugs for cholesterol, diabetes or hypertension. She says PBMs often apply DIR fees six months to 12 months after a drug is dispensed.
“This incentivizes PBMs to apply more discounts after dispensing, when they can retain the 65% of the discounts, and call these ‘savings,’” she says. She also questions the way metrics are tracked—often through an entire contracting network rather than by providing specific information about each patient.
Shanahan finds this process “unsustainable,” forcing Medicare Part D beneficiaries into the donut hole more quickly and making it difficult for specialty pharmacies to provide services while already riding on razor-thin margins.
“This means that for many drugs there is a negative margin before we even deliver a specialty drug and offer our services, such as helping patients navigate the system, manage their medications, get the right drug in the right dose at the right time and dispensing,” she says.