The Washington State Pharmacy Association (WSPA), in collaboration with the National Community Pharmacists Association (NCPA) and the National Association of Chain Drug Stores (NACDS), on March 31 sued the State of Washington to stop the rule that will pay pharmacies less than the actual cost for dispensing Medicaid prescription drugs.
The Medicaid pharmacy benefit is highly valued among Washington State residents. According to the Morning Consult survey, conducted in March and commissioned by NACDS, about 80% of voters in Washington State believed that Medicaid should cover pharmacy benefits for its enrollees.
Furthermore, about 88% of respondents in Washington State highly appreciate the convenience and easy access to pharmacies and considered it the highest among other healthcare providers such as specialist physicians, primary care physicians, emergency rooms, nurses, and other doctors.
The associations stated that the rule was procedurally and substantively flawed. This rule makes patients’ access to their prescription medications jeopardized and unreliable, and leads to other costlier healthcare services related to untreated health conditions.
In their motion filed on March 31 to the Superior Court of Washington (Thurston Country), NCPA, NACDS, and WSPA wrote that the motion sought to halt further reimbursement cuts until the State properly implements Medicaid reimbursement rates that would completely cover pharmacies’ expenses when they serve Medicaid enrollees as required by federal law.
The Washington State Health Care Authority’s rule (WSR 17-07-001) changes the basis of the agency’s determination of pharmaceutical cost pharmacies spend.
With the rule, the amount of money reimbursed to pharmacies for dispensing medications for Medicaid enrollees is reduced.
Violations
Unlike the U.S. Department of Health and Human Services’ Centers for Medicare & Medicaid Services (CMS) federal rule, the Washington State rule doesn’t make any adjustments to account for another expense paid by pharmacies called a professional dispensing fee.
This fee must cover the pharmacy’s actual costs to fill the prescription safely. Pharmacists’ professional services cost is included to the professional dispensing fee.
In Washington State, the dispensing fee is much lower than the cost that was calculated during the studies conducted by other states.
According to an independent study conducted under the supervision of NCPA and NACDS, the dispensing cost in Washington State was more than twice as high as the professional dispensing fee proposed by the Washington rule for Medicaid enrollees.
Furthermore, Washington state also violated rulemaking procedures besides failing to adjust the professional dispensing fees in order to cover pharmacies’ expenses for covering Medicaid prescriptions.
Pharmacies were informed by Washington state after the formal comment period that fees would not be adjusted after it had issued the final rule.
Because of late information and the final rule issue without the knowledge of the pharmacy associations, pharmacies did not have any opportunity to comment on the rule as was required by the State’s Administrative Procedure Act.
In the motion, pharmacy associations told the State that its new rule was flawed procedurally as well as substantively. They added that it should be stayed because it continued the agency’s action that violated federal law. On top of that, the State failed to follow the clear directives that should be applied when a rule is amending.
