Bill To Reduce Medicare Payments Fails

Although the House of Representatives approved HR 6331, a bill that would, among other things, reduce Medicare payments to physicians by 10%, by a lopsided vote of 355 to 59, the bill failed to pass the Senate by a large enough majority to override a threatened Presidential veto.

While the reduction in payments to physicians has been the most obvious provision in the bill, other parts directly affect pharmacy. One provision would require insurance companies to pay valid claims within 14 days of when they’re received. Another part of the bill would change the way the costs of drugs are calculated. Medicare and other insurers pay for prescriptions by paying an estimated price for the drug, plus a fee for the dispensation. These fees, which have to cover the expenses of running the pharmacy – salaries, rent, utilities – have always been low, but there was enough excess in the estimated cost of the drugs to allow pharmacies to operate at a profit. By changing the way the cost of the drugs is calculated, many small and low volume pharmacies, particularly those in rural areas, are expected to become unprofitable. The American Pharmacists Association has estimated that these cuts could force as many as 11,000 pharmacies to close.

The Senate will reopen discussion of the bill when it returns from its Fourth of July recess.