Pharmacy direct and indirect remuneration fees not included in point-of-sale ‘negotiated rates,’ known as DIR pharmacy fees, have continued to rise at an unprecedented pace. This growth has impacted patient healthcare costs and the profitability of small business community pharmacies for many years. According to CMS, DIR fees applied against pharmacies involved in Medicare Part D Programs rose by 1,600% since 2015. The rise in cost is unsustainable for the community pharmacies that patients rely on for their Part D prescription medications.

The National Community Pharmacists Association (NCPA) filed a federal lawsuit against the Department of Health and Human Services regulations. The case, NCPA vs. BECERRA, argues that:

  1. The rule’s definition of “negotiated price” violates the plain language and intent of Congress when they passed legislation creating the Medicare Part D program.
  2. The rule is invalid as arbitrary and capricious and unsupported by substantial evidence.
  3. The Final Rule was not adopted through proper notice-and-comment rulemaking.

The complaint also presents an exception found in a provision of the Centers for Medicare & Medicaid Programs that specifies that all negotiated rates must include price discounts from network pharmacies, except for those contingent price concessions that cannot be reasonably calculated at the point of sale. PHSL will continue to monitor for outcomes of the NCPA lawsuit and any impact to Medicare Part D programs.




Posted: May 2021

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