Pharmacy leaders welcome latest rule on military prescription pricing for retail
ALEXANDRIA, Va. Chain and independent pharmacy groups are applauding the government’s release of final rules on how prescription drugs are purchased and priced by the Department of Defense for its TRICARE health benefit program.
TRICARE’s pharmacy benefit covers more than 9 million active duty members of the military, retirees and their families. The huge potential size of that pharmacy market makes the issue of where TRICARE beneficiaries obtain their prescriptions a critically important one for retail pharmacy.
The new regulations from the DoD – which governs Federal Supply Schedule pricing for TRICARE prescriptions – will help level the playing field between retail and mail-order pharmacies by allowing the military to obtain pricing discounts for retail prescriptions. In turn, those discounts, generated through direct negotiations between federal procurement officials and pharmaceutical companies, will lower the costs military beneficiaries incur when they fill prescriptions in local community pharmacies.
Historically, retail pharmacies have operated at a competitive disadvantage vis-a-vis mail-order and military-base pharmacies because prescription costs were higher for military members and their families, if they chose to fill their scripts in a community pharmacy setting. The discounts provided through direct price negotiations will lower retail prescription costs for TRICARE and, pharmacy leaders hope, restore some of the competitive balance.
The new pricing regulations will also save taxpayers money. According to Congressional Budget Office projections, negotiated pricing discounts will yield more than $12.6 billion in savings for the TRICARE pharmacy program in fiscal years 2010-2015.
Leaders for the National Association of Chain Drug Stores and the National Community Pharmacists Association hailed the new policy.
“Our nation’s brave men and women in the armed forces and their families deserve a choice when it comes to healthcare services,” said NACDS president and CEO Steven Anderson, and NCPA EVP Bruce Roberts in a joint statement.
Both pharmacy leaders also foresee longer-term savings and health benefits for the military by keeping open the retail option for its members.
“In addition to their convenience and accessibility, through personal interaction with beneficiaries, retail pharmacists can help to increase medication compliance, resulting in overall better health outcomes for patients, and a potential reduction in spending in other parts of the TRICARE program,” Anderson and Roberts stated.
The final rule also requires preauthorization before TRICARE beneficiaries can obtain non-formulary drugs from retail pharmacies. Both NACDS and NCPA have long argued that the preauthorization requirement should also apply to TRICARE’s mail-order pharmacy benefit.
“NACDS and NCPA will continue to work with DoD to structure a preauthorization program that is not overly burdensome to TRICARE beneficiaries or pharmacies, and continue to advocate for an extension of the current freeze on increases to TRICARE retail pharmacy co-payments,” Anderson and Roberts added.