October 21, 2017  Last Update: December 21, 2016, 11:10 pm

Pharmacies Fill Medicaid Scripts at a Loss?

Pharmacy print published by retail pharmacists "RxMan" showing costs and losses associated with Medicaid reimbursement for a 25 day supply (150 tablets)  of 15mg Oxycodone.

Pharmacy print published by retail pharmacists “RxMan” showing costs and losses associated with Medicaid reimbursement for a 25 day supply (150 tablets) of 15mg Oxycodone.

For our awareness, a retail pharmacist highlighted how a 25 day prescription for 150 tablets of 15mg Oxycodone at his pharmacy, had a “cost” of $40.88. That is the “acquisition cost” meaning the cost to buy it for resale. “RxMan” tells us that cost does not include additional costs for covering the pharmacists, the tech staff, the bottling and labeling, etc.

Medicaid pays the pharmacists a mere $31.40 for filling that prescription. In other words, the pharmacy takes a loss of nearly $10 for that 25 day supply, in addition to providing the labor and materials (and taking on the risks, I assume).

To suggest this is not “sustainable” would be ridiculous. No business could afford to subsidize every sale like that. But the situation deserves a little more thought. Who is paying the cost of Medicaid (and other such unsustainable systems, of which we have many)?

American taxpayers assume that “the government” pays the bill for Medicaid (using taxpayer money). Now we see that the government is paying part of the bill, and forcing the pharmacy to contribute what in this Oxycodone example is roughly 25% before the added costs of running the pharmacy. That is a quite significant percentage. The pharmacy will recover that loss by marking up other products, which means we all pay for the additional cost. Of course the example is much more controversial when it is Oxycodone, an addicting opioid pain killer.

If you imagine the possible diversion of the Oxycodone tablets into the many channels we’ve seen for diversion of such addicting drugs to the black market, the costs to society mushroom. And this is just one example, using one drug, from one pharmacy.

Some pharmacist complains that the big drug distributors (the ones selling that Oxycodone to the pharmacy for $40.88) and “middlemen” benefit management companies are making all the profits, while not providing the services nor taking on the risk. There is now an activist group trying to shine light on that issue.

Resources:

  • RxMan” anonymous retail pharmacy blogger
  • the fight against unreasonable Medicaid reimbursements goes way back
  • Current organized opposition to “middlemen” in the system

 

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