HHS: Medicare pharmacy pay lower than Medicaid

A new report from the HHS Office of Inspector General has given pharmacies ammunition in their fight for better reimbursement under the Medicare prescription drug benefit. According to the report, which was requested by 33 senators in response to pharmacy industry complaints, pharmacies charge health insurers an 18 percent surcharge on the cost of medications, and get a dispensing fee of about $2.27 per prescription under the Medicare drug benefit system. That's about $2 less than what they get in dispensing fees for Medicaid prescriptions, the OIG report concluded. The Association of Community Pharmacists says that this level of reimbursement is inadequate, as it doesn't cover all of its members' costs. The ACP says that pharmacies would have to charge a premium of more like 20 percent to 21 percent to stay in business.

At this stage, it's not clear what will happen next, as the report doesn't make any specific recommendations. But it seems likely that the senators will seek to gather more information, perhaps at a future hearing.

To learn more about this issue:
- read this Kaiser Daily Health Policy Report item

Related Articles:
Medicare Part D, healthcare play out in an election year. Report
'Mixed successes' of Medicare Part D. Report

Suggested Articles

The profit margins and management of Community Health Group raise questions about oversight of managed care insurers.

Financial experts are warning practices about the pitfalls of promoting medical credit cards to their patients.

A proposed rule issued by HHS on Tuesday would expand short-term coverage, a move Seema Verma said will have "virtually no impact" on ACA premiums.