In the News: Advocates Urge Senate to Act on DIR Fees

Monday, July 16, 2018

As the U.S. Department of Health and Human Services (HHS) focuses its attention on drug pricing, a pharmacy advocacy group is urging HHS leadership not to ignore the issues presented by direct and indirect remuneration (DIR) fees.

In a July 11 article, “NACDS RxImpact calls on Senate to support action on DIR fees,” Drug Store News reports that, following Capitol Hill lobbying efforts in March, the pharmacy advocacy group NACDS RxImpact recently asked Senators to sign a letter urging HHS to consider the potentially negative effects of DIR fees on patients. The letter is receiving bipartisan support.

The Senators who signed the letter “are sharing the real-world jeopardy to patient care when pharmacies learn well after a transaction occurs that some of the payment that they received must be returned to a health plan,” said NACDS president and CEO Steve Anderson.

In a 2016 RxPerts Academy blog on the subject, contributor David J. Fong, PharmD, gave this assessment of DIR fees:

“The Centers for Medicare & Medicaid Services (CMS) created Direct and Indirect Remuneration, or DIR, fees as a way to track the annual amount from manufacturer rebates and price adjustments applied to prescription drug plans that are passed on to CMS to offset the cost for operating the Medicare Part D program. The issue is that any variance from the budget spend is retroactively charged by CMS back to health plans and PBMs … who then charge it back to the pharmacy, potentially impacting adversely on its financials.

“The root cause for the stress on pharmacy over the retroactive DIR fee “clawback,” as it is known, is the lack of transparency on the accountability of the fees applied to pharmacies and how they ultimately help CMS stay on budget. In a recent op-ed criticizing DIR, the CEO of the National Community Pharmacists Association (NCPA) revealed that, according that a study performed by his organization, 67% of pharmacies said PBMs provided no information on the amount or timing of DIR fees and 87% said DIR fees were significantly affecting their pharmacy’s ability to provide care and stay in business.”

The current advocacy efforts of NACDS follow CMS’s recent statement in the Final Medicare Part D Rule that it is has the authority to regulate DIR fees without requiring legislative action.

Read the full article.

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