Strategies for Optimizing

Health Center Pharmacy Operations

The Role of PCAs and HCCNs

Why is pharmacy important to our health centers?

Nothing good can come out of failing to take a medication as prescribed. "Drugs

don’t work in patients who don't take them.”

Surgeon General C. Everett Koop

125,000 people with treatable ailments die annually in the United States because they

do not take their medication properly.

Poor adherence in CVD = $100 billion annually.

33-69% of hospital readmissions 2 poor medication adherence.

World Health Organization

“To diagnose but not be able to treat is always an exercise in futility, but sometimes

it’s a death sentence.”

Community Health Center physician

QualityAccess

Capacity

The goal is to optimize the value of pharmacy programs to the mutual benefit of:

patients access and quality

health centerssustainability and enhanced capacity

4 Core Strategies for Optimization:

Expand health center owned pharmacies

Optimize the use of 340B inventory

Clinic administered drugs and devices (CAD)

Eligibility around the continuum of care

Increase capture/improve margin

Bring pharmacy into the fold – models of clinical integration

Where are the barriers?

Awareness, knowledge, & priorities

Reimbursemento Discriminatory contracting

o DIR fees

Policy environmento Climate and clarity

o Limitations on clinical practice

System perspective

What can PCAs

and HCCNs do to move the needle?

Engage and Educate

o Develop a learning community

o Activate health center leaders

Advocate

o Tell the health center story

o Shape policy

Connect and Innovate

o Develop infrastructure for peer-

to-peer learning and be

Introducing our panelists:

Cheri Rinehart, CEO of the Pennsylvania Association

of Community Health Centers - PACHC

Cindy Stergar, CEO of the Montana Primary Care

Association - MPCA

Ben Browning, Vice-President, PCA Operations,

Programs and Policy Florida Association of

Community Health Centers - FACHC

Optimizing Value and Supporting Compliance in

Pennsylvania Health Center Pharmacy Programs

Cheri Rinehart, CEO Pennsylvania

Association of Community Health Centers

PACHC

Optimizing Pharmacy in PA

Community Health Centers :

- State Landscape

- Department of Human Services

- Health Centers & 340B

- Multipronged Strategy

- Pilot

- Baseline data

- Advocacy

- Education

Optimizing Pharmacy in PA Community Health Centers

5-Part Webinar Series

The Essential Framework for Optimizing Health Center Pharmacy Services and Maintaining Effective Oversight and Compliance

340B Program Integrity: External Audits and the Imperative for a Comprehensive and Effective Internal Audit Plan

Operational Strategies for Enhancing the Value of the 340B Pharmacy Program to the Mutual Benefit of the Patient and the Health Center

The Pharmacy Revenue Cycle: The Guidelines and Challenges in Establishing Charges and Reimbursement Policies

Demonstrating and Communicating the Value the Health Center 340B Pharmacy Program brings to the Patients and Communities Served

What have we

learned?

Where do we

go from here?

340B Savings and PBMs: Challenging

Discriminatory Reimbursement Practices

Raina White, R.Ph.

Co-Director of Pharmacy

Partnership Health Center

SHARED by Cindy Stergar CEO

Montana Primary Care

Association

What is a PBM?

Formed to help save insurance plans and their patrons money by: Building formularies;

Forming bargaining groups amongst the various health plans;

Contracting with pharmacies; and

Processing and paying pharmacy claims.

PBM Market Share:

CBS Caremark, owned by

Aetna

30%

Express Scripts, owned by

Cigna

23%

OptumRX, owned by United

Health Care

23%

Humana 7%

Prime Therapeutics, owned

by BC/BS

6

Note:

the top 3 insurers/PBMs as of 2018

control 76% of the prescription claims

market

**THE NUMBERS SHOWN HERE WERE DERIVED FROM Exhibit 76 in the 2019 Economic Report on U.S. Pharmacies and Pharmacy Benefit Managers, Drug Channels Institute, Available at http://drugch.nl/pharmacy**

How bad could it be?

Fees

Direct and Indirect Remuneration (DIR) Fees

oPenalty based on PBM/health insurer specified

Star rating System

• Based on criteria such as:

% of patients in compliance with maintenance drugs

fills for:

Diabetes meds

Blood pressure meds

Etc…

• The higher the rating the lower the fee

BUT THERE IS ALWAYS A FEE!

How bad could it be? Well, there’s more…

Generic Effective Rate

(GER) – defined as Average

Wholesale Price (AWP)

minus a percentage i.e.

AWP-18

Brand Effective Rate (BER) –

defined as AWP for brand

name meds minus a

percentage at a lower rate

the GER.

Claw Backs –

Example: XYZ pharmacy

submits a claim for $5.00. The

PBM processing the claim

debits the pharmacy $17.00

and sets the patient copay @

$22.00. What just happened?

Patient paid $22.00

Pharmacy received $5.00

PBM received $17.00

Audits–

Necessary step that keeps pharmacies honest, but

There is a cost to the pharmacy in terms of both

lost claims and defense of claims

Then they discovered the 340B

Program…

Translation:

- 340B covered entities

were/are making money

- They want it!

One of the largest

PBMs in the market

sent an addendum to

Partnership Health

Center noting:

Health center is a 340B

covered entity; and

The PBM plan to retract

previously agreed

contract pricing and

decrease each and

every claim by a stated

percentage.

What did we do?

Partnership Health Center’s

Executive Director started

contacting lawmakers and

turning to our partners –

such as the Montana

Primary Care Association

(MPCA) for help.

Through the partnership

with MPCA, legislation was

passed!

Where are PBMs in the Process?

PARTNER LEGISLATION

HB 344: Require transparency reporting

of pharmacy benefit managers (DIED)

Submit report to state’s Insurance Commissioner

Aggregate amount of rebates from

manufacturers

Aggregate amount of admin fees from

manufacturers

Aggregate amount of retained rebates not

passed through to insurers

PARTNER LEGISLATION SB 71: Regulate health insurers’ administration of

pharmacy benefits for consumers (VETOED)

Health insurance issuer shall monitor all activities carried out by or on behalf of the issuer and is responsible for ensuring all requirements are met.

Health insurance issuer shall not enter into any contract or agreement that prohibits a provider from:

Offering patient option of paying cash price

Providing information to a state or federal agency, law enforcement agency, or the insurance commissioner when disclosure is required by law.

Health insurance issuer shall provide an adequate retail pharmacy network

Health insurance issuer shall establish the amount a health benefit plan will pay a provider for a prescription drug covered by the plan.

All compensation that is directly or indirectly related to a health benefit plan must be remitted or retained by the health benefit plan and used to lower health benefit plan premiums.

PARTNER LEGISLATION SB 83: establishing allowable and prohibited practices

for pharmacy benefit managers (PASSED)

A PBM or third-party payer may not directly or indirectly

charge or hold a pharmacy responsible for a fee related

to the claim

A PBM or third-party payer may not charge a patient a

copayment that exceeds the cost of the prescription

drug.

A PBM or third-party payer may not prohibit a pharmacist

or pharmacy from:

Participating in a class-action lawsuit

Disclosing to the plan sponsor or the patient information regarding the

adjudicated reimbursement

Providing relevant information to a patient about the patient’s

prescription drug order, including but not limited to the cost and clinical

efficacy of a more affordable alternative drug

A PBM or third-party payer may not require pharmacy

accreditation standards or recertification requirements

inconsistent, or more stringent, than federal or state law

PARTNER LEGISLATION SB 270: Revise reimbursement conditions for certain

pharmacies, pharmacists (PASSED)

At the time of entering into a contract with a pharmacy, and subsequently upon request, a plan sponsor, and health insurance issuer, or a PBM shall provide the pharmacy with the sources used to determine the pricing for the maximum allowable cost list or the reference used for reference pricing.

Lists must be reviewed an updated every 10 days

Provide a process for each pharmacy to access lists in a searchable and usable format

A plan sponsor, health insurance issuer, or PBM may not:

Prohibit a pharmacist from discussing reimbursement criteria to a covered person

Penalize a pharmacy or pharmacist for disclosing reimbursement information or for selling a more affordable alternative to a covered person

Require a pharmacy or pharmacist to charge or collect a copayment from a covered person that exceeds the total charge submitted by the network pharmacy.

MPCA LEGISLATION SB 335: Revise insurance laws related to pharmacies &

certain health entities (PASSED)

Define 340b and 340b contract pharmacies in state statute

Health insurance issuer, a plan sponsor, or a PBM may not include in a contract with a 340b entity:

Payment for a prescription drug to a 340b entity or its contract pharmacy at less than the state rate determined by surveys used to develop a national average drug acquisition costs for CMS or a payment less than the wholesale acquisition cost

An additional fee or charge or other adjustment that is only imposed on 340b entities or 340b contract pharmacies

A patient eligible to receive drugs under an agreement covered by 340b may not be discriminated against through conditions imposed on a 340b entity or its contract pharmacy through which the patient is eligible to receive drugs

Fines not to exceed $5,000 for each violation, subject to maximum fine of no more than $100,000 in any year.

LOOKING AHEAD Reconsider SB 71: Regulate health insurers’

administration of pharmacy benefits for consumers

Network adequacy requirement

Co-payment reform for 340b entities (safety net)

Recent PBM contract prohibited dispensing if full copayment was not collected

Contact:

Cindy Stergar CEO

Montana Primary Care Association

cstergar@mtpca.org

406-438-6264

Building an FQHC Pharmacist Network

Collaboration on the Ground

Pharmacy Roundtable

More than a decade

Organically grown and Organizationally supported

Florida’s Community Health Center Members

Led by CHCs for CHCs

Best way to Assess the Needs (direct conversation)

Key Functions

Leadership (Volunteer and Elected)

Without a strong leader, nothing else matters (Roundtable and PCA)

Regulatory Issues

e.g. Federal 340B regulations, State licensure and reimbursement issues

Federal and State Legislation

Not advocacy, it’s information

Policy Issues

OPA, AHCA (Medicaid), 340B, etc.

Resource Sharing

Monthly Calls

Emails

“Wiki”

Boots on the Ground

Assist FACHC in our on the ground efforts

Inform educational materials

Streamline approach on complex issues

Provide data & personal stories

Ready-to-go army of advocates

Real-time input and feedback

Meet with State regulators

Present in Legislative Committee

Mutual Benefit

As much as we help them, they help us

Clear intent and roles

This is a labor of love for the CHCs – it’s not something that takes hold

overnight and lasts without significant effort

It is what they make it to be

If there is no value, there is no participation

Ben Browning, MPA

Vice President

Florida Association of Community Health Centers, Inc.

ben@fachc.org