AWP rollback...

[Doctor M]

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Im interested to know if anyone knows about this AWP rollback and how it will impact pharmacy. Im mostly interested in the opinions of pharmacy students...but pharmacists, please do chime in...

Dr. M

 

[Aznfarmerboi]

Im interested to know if anyone knows about this AWP rollback and how it will impact pharmacy. Im mostly interested in the opinions of pharmacy students...but pharmacists, please do chime in...

Dr. M

I have read about it a few weeks ago. I believe the story goes along the lines of something like this. The government found drug companies and wholersalers artificially manipulating and raising AWP. Now that the companies are fined... they want to lower the AWP by a few percent since they argued it was artifically high by that few percent to begin with.

Long story short... regardless of what AWP is and its irrelevance, pharmacy profit margins are 2-3 percent and lowering AWP by 3-4 percent can translate to independent pharmacies doing business at a loss. This always impact pharmacy some how... and as a part time independent... my wage (30 cash) means it might be lower since the business is already paying me to work at a loss.

 

[Doctor M]

I have read about it a few weeks ago. I believe the story goes along the lines of something like this. The government found drug companies and wholersalers artificially manipulating and raising AWP. Now that the companies are fined... they want to lower the AWP by a few percent since they argued it was artifically high by that few percent to begin with.

Long story short... regardless of what AWP is and its irrelevance, pharmacy profit margins are 2-3 percent and lowering AWP by 3-4 percent can translate to independent pharmacies doing business at a loss. This always impact pharmacy some how... and as a part time independent... my wage (30 cash) means it might be lower since the business is already paying me to work at a loss.

Well, only brand name drugs are impacted...but this is significant when your profit on brands is 6-7%. One insurance company is reimbursing at WAC - 0.6%! Most wholesalers sell at WAC so yeah, your operating at a loss...What do you think should be done about this?

 

[Doctor M]

Wow, really, only 1 response? I figured students would be interested in topics that will impact their future...cause anyway you look at it, it will impact all of us.

 

[meister]

Wow, really, only 1 response? I figured students would be interested in topics that will impact their future...cause anyway you look at it, it will impact all of us.

Lol, pharmacy students have like zero clue on AWP and the business aspect of pharmacy. They don't train them to run pharmacies, they train them to be clinical pharmacists and then the new grads have to fend for themselves afterward. Pretty much exactly like medical school.

That's been my experience at least.

 

[Praziquantel86]

It's crappy, but what else is new? Reimbursement rates have been getting cut to razor-thin margins over the last decade, so its not surprising that its happening again. Business models are going to have to change if independent pharmacies are going to remain viable.

I see the problem as a lack of lobbying power. Pharmacy reimbursement rates are a fairly obvious way to cut overall healthcare costs (along with physician rates) but the pharmacy lobby is doing absolutely nothing to stop it. NCPA puts up a fight at a national level, but its absurd to think that they have any real influence. Maybe if APhA pulled their heads out of their asses and started worrying about issues that actually matter, this wouldn't be such a problem.

Being a UB grad, I'm sure you know how much people care about this up here. I just don't think other schools are the same way.

 

[Doctor M]

It's crappy, but what else is new? Reimbursement rates have been getting cut to razor-thin margins over the last decade, so its not surprising that its happening again. Business models are going to have to change if independent pharmacies are going to remain viable.

I see the problem as a lack of lobbying power. Pharmacy reimbursement rates are a fairly obvious way to cut overall healthcare costs (along with physician rates) but the pharmacy lobby is doing absolutely nothing to stop it. NCPA puts up a fight at a national level, but its absurd to think that they have any real influence. Maybe if APhA pulled their heads out of their asses and started worrying about issues that actually matter, this wouldn't be such a problem.

Being a UB grad, I'm sure you know how much people care about this up here. I just don't think other schools are the same way.

This is the response i was hoping to get. yes, being a UB grad i know first hand how much they lobby in upstate NY. It's really the only way. Living here in florida, i havent seen much of anything in terms of lobbying or any word of pharmacies fighting back. My partner and I sat down yesterday and discussed ways of how to combat this...Very tough to do when no one really cares...But as soon as salaries start to bottom cause the profits arent there at all, then it will be a fight...My partner and I will find a away to fight this, cause getting reimbursed what you paid for the drug or worse yet, less than what you paid is absurd...Most of us just accept the contract and say "oh well"...enough is enough...

And the excuse that schools dont teach this...well, start learning it on your own...join your state association and be informed...

 

[womp]

cause getting reimbursed what you paid for the drug or worse yet, less than what you paid is absurd...

Welcome to the life of Medicaid and Medicare for physicians: reimbursements below cost.

 

[Doctor M]

Welcome to the life of Medicaid and Medicare for physicians: reimbursements below cost.

I emphathize..but we accept whatever they throw at us...at least most pharmacies do...the big chains will accept it usually cause they have the volume...

 

[MountainPharmD]

I emphasize...but we accept whatever they throw at us...at least most pharmacies do...the big chains will accept it usually cause they have the volume...

.....and there is your answer on why this happens. The big chains figure they can make up for it in volume. It is a business plan destined to fail. There will come a time when even the big chains will not be able to make up the loss with volume. By the time we get to that point we are all screwed.

 

[Doctor M]

.....and there is your answer on why this happens. The big chains figure they can make up for it in volume. It is a business plan destined to fail. There will come a time when even the big chains will not be able to make up the loss with volume. By the time we get to that point we are all screwed.

It will only fail if we let it fail...When i was in school, my pharmacy manager would tell me that I have to get involved with the state, lobby, be a leader in pharmacy and fight for our rights...blah blah blah...that is what i thought...but now im seeing the dark side...it's upsetting...instead of accepting it, we should be thinking of ways to fight back...any ideas? I ask this because although many of you work for chains, sooner or later they will not be able to keep up and wages will be slashed...and like MountainPharmd said, we are all screwed...

Dr. M

 

[Praziquantel86]

And the excuse that schools dont teach this...well, start learning it on your own...join your state association and be informed...

Student activism on issues like this is hard to come by. Most students just don't care yet, because it doesn't directly affect them. They see no immediate benefit from actively lobbying and otherwise trying to change the status quo, but get immense immediate benefit from studying more or just plain old relaxing with their friends.

What's the saying, 5% of the students will account for 95% of the involvement? I'm pretty active in a few groups here, and we've been trying to figure out ways to get students more involved. It hasn't been an easy process at all.

 

[Doctor M]

Student activism on issues like this is hard to come by. Most students just don't care yet, because it doesn't directly affect them. They see no immediate benefit from actively lobbying and otherwise trying to change the status quo, but get immense immediate benefit from studying more or just plain old relaxing with their friends.

What's the saying, 5% of the students will account for 95% of the involvement? I'm pretty active in a few groups here, and we've been trying to figure out ways to get students more involved. It hasn't been an easy process at all.

I was one of those students back in school...I wanted to kick back and relax...Been there...but i guess what im saying is get involved now, cause in 3 years who knows what the salary/job outlook will be...perhaps it will be the same as today...perhaps it wont...Either way, keep up your work on your groups...AWP will be gone soon and these ins will reimburse based on WAC...Not good...

 

[MountainPharmD]

There is nothing we can do. It falls squarely on the big corp. chains to get some balls and stand up to the insurance companies. Fat chance of that happening since CVS merged with one of the largest PBM's. Its sort of like the saying if ya can't beat 'em join 'em. How the government ever allowed this to happen is a mystery.

A great place to start is getting involved with your State Board of Pharmacy. Right now most boards are filled with retail pharmacy corporate stooges. This is how programs like POWER and work at home technicians get passed through. If more regular staff pharmacists got involved with the State Boards it would be a lot harder to pass this kind of BS.

 

[Doctor M]

There is nothing we can do. It falls squarely on the big corp. chains to get some balls and stand up to the insurance companies. Fat chance of that happening since CVS merged with one of the largest PBM's. Its sort of like the saying if ya can't beat 'em join 'em. How the government ever allowed this to happen is a mystery.

A great place to start is getting involved with your State Board of Pharmacy. Right now most boards are filled with retail pharmacy corporate stooges. This is how programs like POWER and work at home technicians get passed through. If more regular staff pharmacists got involved with the State Boards it would be a lot harder to pass this kind of BS.

But dont you think that is exactly why nothing can be done...cause we all think nothing can we done...It "can't" be done...I believe something can be done...but it has to be united...🙄

 

[MountainPharmD]

But dont you think that is exactly why nothing can be done...cause we all think nothing can we done...It "can't" be done...I believe something can be done...but it has to be united...🙄

What can individual pharmacists do? Reatil pharmacists have nothing to do with accepting the ****ty PBM contracts. Those that do are the corporate idiots that are responsible for this mess. You and I can gripe and cry all we want. You are an independant pharmacy owner and I am a retail chain pharmacy manager. Why would a PBM care what we think?

 

[Doctor M]

What can individual pharmacists do? Reatil pharmacists have nothing to do with accepting the ****ty PBM contracts. Those that do are the corporate idiots that are responsible for this mess. You and I can gripe and cry all we want. You are an independant pharmacy owner and I am a retail chain pharmacy manager. Why would a PBM care what we think?

A PBM would not and does not care what you and I think...I am griping cause i have no where else to gripe...🙂 Anyway, I hope that these PBM's hit the chains so hard that the chains will one day say enough is enough...

 

[Aznfarmerboi]

Actually, this is where you are wrong. Retails are definitely fighting and lobbying against this. They too understand that every year... reembursements has been going down and that sooner or later, they got to draw a line. Every percent counts since there is only so much discount they can get from volume buying. For example, chains threaten to pull out of medicaid in Washington a few months ago. I know several chains mass e-mailing their workers to write to their representives.

Anyway, the cuts that went into affect today wasnt too bad...

 

[Doctor M]

Actually, this is where you are wrong. Retails are definitely fighting and lobbying against this. They too understand that every year... reembursements has been going down and that sooner or later, they got to draw a line. Every percent counts since there is only so much discount they can get from volume buying. For example, chains threaten to pull out of medicaid in Washington a few months ago. I know several chains mass e-mailing their workers to write to their representives.

Anyway, the cuts that went into affect today wasnt too bad...

Did you see H-u-m-a-n-a ??

 

[MountainPharmD]

A PBM would not and does not care what you and I think...I am griping cause i have no where else to gripe...🙂 Anyway, I hope that these PBM's hit the chains so hard that the chains will one day say enough is enough...

I am with ya!!!! It will eventually get so bad the chains will have had enough. I wonder how much worse things will get before we get to that point. Walgreens and CVS are big enough they could have done something about this years ago. Instead CVS merges with one of the largest PBM's. I am not hopefull things will change any time soon.

 

[Aznfarmerboi]

I am with ya!!!! It will eventually get so bad the chains will have had enough. I wonder how much worse things will get before we get to that point. Walgreens and CVS are big enough they could have done something about this years ago. Instead CVS merges with one of the largest PBM's. I am not hopefull things will change any time soon.

Hah merge??? more like take over. We paid for Caremark in cash...