Survey takes pulse of independent pharmacies

Monday, July 31, 2006

A self-described pharmacist by trade, Bill Popomaronis decries the assault on profit margins and the discounting of the value of community pharmacies brought on by Medicare Part D, reimbursement cuts and the proposed national competitive bidding (NCB) program. Popomaronis is the vice president of long term and home healthcare pharmacy for the National Community Pharmacists Association and serves on the Program Advisory and Oversight Committee. In June, he sent a survey to 1,000 independent pharmacies to gauge what will happen once NCB is implemented.
HME News: Are there many community pharmacies affected by NCB?
Bill Popomaronis: One of the first questions on the survey was, 'Do your pharmacies currently provide DMEPOS, and the overwhelming majority did, something like 97%. On the National Supplier Clearinghouse (NSC) Web site, under active suppliers, pharmacy is by far the largest group of suppliers, with close to 53,000 supplier numbers out of something like 150,000 total.
HME: Describe the typical independent community pharmacy.
Popomaronis: These are typical small businesses. Many of them average 10 employees but the median is six. I don't like the term mom and pop. Whether it's a dealer or pharmacy that's maintaining a billing number, they're using technology to be efficient providers. About 90% of them do less than $500,000 a year in sales and 60% say the bulk comes from diabetic testing strips.
HME: Did most of the survey respondents plan to participate in NCB?
Popomaronis: Over 60% said they will not participate in the program and another 11% were not sure. CMS believes that 90% of suppliers within a certain area will bid, either to maintain or grow their business. But what I'm reading here, basically about only 30% of pharmacies will participate. Remember, pharmacies represent one out of every three suppliers. It's going to be significant, but certainly not 90%.
HME: What were some of the reasons given for not participating?
Popomaronis: They said things that you would expect: bidding is going to lower the profits to unacceptable levels, obtaining accreditation is too expensive, it takes too long to bid.
HME: How many of the responding pharmacies are accredited?
Popomaronis: Less than 10% have obtained accreditation. Something that's a little bit more surprising is, ultimately, everybody has to obtain accreditation with the way the rule is currently proposed. About 70% of survey respondents said they will maintain their NSC supplier number. NCPA believes that pharmacy is already heavily licensed and accredited and regulated and frankly, we'd like to see pharmacies exempt from additional requirements.
HME: What is NCPA's position on the NCB proposal regarding mail order for certain items in 2010?
Popomaronis: CMS is requesting comments for items that could be delivered through the mail, typically ostomy and diabetic supplies. We're vehemently opposed to mail order as an only option. Nobody is suggesting that there shouldn't be mail order, but the big change is that it becomes mandatory rather than voluntary.