Magazine article Drug Topics

Walgreens Pushes Back

Magazine article Drug Topics

Walgreens Pushes Back

Article excerpt

MEDICAID REIMBURSEMENT

Walgreens executives have stated that they must withdraw about half their pharmacies from Washington State's Medicaid program, effective February 15.

Of Walgreens' 121 Washington pharmacies, 64 are pulling out because cutbacks to the state's Medicaid reimbursements have resulted in Walgreens receiving below its cost or break-even point on nearly 95 percent of brand-name medications, according to a statement from the retailer.

Walgreens' withdrawal is just the latest in state Medicaid reimbursement problems. Last fall the National Association of Chain Drug Stores (NACDS), the National Community Pharmacists Association (NCPA), and other pharmacy groups sued Washington, California, Minnesota, and New York over Medicaid reimbursements. The states did not adjust their reimbursements as a result of reductions in First DataBank and Medi-Span's average wholesale price (AWP) benchmark, as required by the Social Security Act, the groups said.

In addition, last fall a Massachusetts court ruling reduced the industry pricing standard, even though pharmacies' acquisition costs have not changed, according to Walgreens. "While many private insurance providers have adjusted pharmacy reimbursement rates to limit the impact of the court ruling, Washington's Medicaid program has yet to do so," said the Walgreens statement. …

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