Health & Medical Guide

Medicare D challenges continue, local pharmacists say

By Ivan Raconteur, Staff Writer

Despite some claims to the contrary, the Medicare D prescription drug program is hurting both consumers and the small pharmacies that serve them, according to some local pharmacists.

Kelly Keaveny is a third-generation pharmacist, and owns pharmacies in Cokato, Winsted and Annandale.

The very design of some programs has already caused some consumers to stop taking needed medications, according to Keaveny.

“A lot of people are already hitting their gap,” Keaveny said.

Some plans are designed with a gap in coverage, so that once a patient spends $2,250 on prescription drugs, the plan does not pay anything until the total reaches $3,600. Patients must pay 100 percent of the drug costs incurred in the gap.

Some customers either cannot afford the out-of-pocket expense, or are electing to go without needed medications because of the high price tag, Keaveny explained.

This creates a health-care issue, because the patient’s physician may have helped the patient get a condition under control, and then the patient stops taking the medication because of the cost, Keaveny said.

In spite of this, Keaveny said that the people who did sign up for a Medicare D plan prior to the May 15 deadline are getting some benefit from it.

However, there are still a lot of people who have not signed up for a plan. Some people did not sign up because they thought it was a scam. Others did not see the benefit of the program, he explained.

The end of small pharmacies?

Another danger with the Medicare D program is that it could put small, local pharmacies out of business, according to Keaveny.

“On every prescription we fill, we lose money. The government is forcing us to sell below our cost,” Keaveny said.

He noted that the government has strict regulations in place to prevent gas stations from selling gas below cost, but at the same time, it is forcing some pharmacies to sell below cost.

This could drive small operators out of business. The large chains are not affected, because of their tremendous buying power.

“The Wal-Marts and Targets and K-Marts can dictate what they will pay for the drugs. We are a small fish in the sea, so we pay more. If a patient needs it (a drug), I am going to get it, even if I lose money,” Keaveny said.

“Some of the large chains also own some of the insurance companies that administer the Medicare part D prescription cards. They are receiving payments for filling prescriptions on the front end, and for administering the program on the back end, which is another reason they are willing to accept the lower reimbursements,” Deb Keaveny said. Deb is Kelly’s wife, and a pharmacist at their Annandale pharmacy.

The government says that a patient can drive up to 50 miles to buy his drugs, so as long as there is a large pharmacy within that distance, there is no incentive for the government to protect the small operators.

As bleak as this picture is, it could get worse.

“The government has already spent more than it expected to support the program,” Kelly said. He predicts that this will lead to further reductions in compensation.

“They did not expect to pay this much, so they will probably pay even less in the future, and they are down to the bare essentials now,” he commented.

The third party providers are making money from the program, which makes it difficult for the pharmacists who are being hurt by the program to get the attention of legislators, according to Kelly.

“They (the plan providers) have one of the largest lobbies in the country, and they are making money for pushing paper. They are collecting fees from the government, and they are telling the government that everything is going great,” Kelly said.

“We were discussing this over a cup of coffee, and laughing; laughing sadly, because we kept reading how wonderful everything was,” Deb commented.

She explained that in February, the government asked plan administrators how the program was working. “They asked the people who were making the profits how the program was working, and of course they said things were going great. Now, the government is starting to send out surveys to pharmacies and consumers, and we hope that they will start to get the message that everything is not so rosy,” Deb commented.

Despite the fact that they are faced with serious challenges, Deb expressed hope for small pharmacies.

“Independent pharmacies have done a wonderful job of adapting and surviving. We just have to find ways to sell more greeting cards, and to do more with less,” she commented.

The Medicare part D prescription drug program does provide some benefits, but it is a program in need of reform, according to the Keavenys.

“This is a system that was set up to fail,” Kelly commented.

Published August 2006

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