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Jun 11 2024 KFF Health News

Months into a new Biden administration policy intended to lower drug costs for Medicare patients, independent pharmacists say they're struggling to afford to keep some prescription drugs in stock.

"It would not matter if the governor himself walked in and said, 'I need to get this prescription filled,'" said Clint Hopkins, a pharmacist and co-owner of Pucci's Pharmacy in Sacramento, California. "If I’m losing money on it, it's a no."

A regulation that took effect in January changes prescription prices for Medicare beneficiaries. For years, prices included pharmacy performance incentives, possible rebates, and other adjustments made after the prescription was filled. Now the adjustments are made first, at the pharmacy counter, reducing the overall cost for patients and the government. But the new system means less money for pharmacies that acquire and stock medications, pharmacists say.

Pharmacies are already struggling with staff shortages, drug shortages, fallout from opioid lawsuits, and rising operating costs. While independent pharmacies are most vulnerable, some big chain pharmacies are also feeling a cash crunch — particularly those whose parent firms don't own a pharmacy benefit manager, companies that negotiate drug prices between insurers, drug manufacturers, and pharmacies.

A top official at the Centers for Medicare & Medicaid Services said it's a matter for pharmacies, Medicare insurance plans, and PBMs to resolve.

"We cannot interfere in the negotiations that occur between the plans and pharmacy benefits managers," Meena Seshamani, director of the Center for Medicare, said at a conference on June 7. "We cannot tell a plan how much to pay a pharmacy or a PBM."

Nevertheless, CMS has reminded insurers and PBMs in several letters that they are required to provide the drugs and other benefits promised to beneficiaries.

Several independent pharmacists told KFF Health News they'll soon cut back on the number of medications they keep on shelves, particularly brand-name drugs. Some have even decided to stop accepting certain Medicare drug plans, they said.

As he campaigns for reelection, President Joe Biden has touted his administration's moves to make prescription drugs more affordable for Medicare patients, hoping to appeal to voters troubled by rising health care costs. His achievements include a law, the Inflation Reduction Act, that caps the price of insulin at $35 a month for Medicare patients; caps Medicare patients' drug spending at $2,000 a year, beginning next year; and allows the program to bargain down drug prices with manufacturers.

More than 51 million people have Medicare drug coverage. CMS officials estimated the new rule reducing pharmacy costs would save beneficiaries $26.5 billion from 2024 through 2032.

Medicare patients' prescriptions can account for at least 40% of pharmacy business, according to a February survey by the National Community Pharmacists Association.

Independent pharmacists say the new rule is causing them financial trouble and hardship for some Medicare patients. Hopkins, in Sacramento, said that some of his newer customers used to rely on a local grocery pharmacy but came to his store after they could no longer get their medications there.

The crux of the problem is cash flow, the pharmacists say. Under the old system, pharmacies and PBMs reconciled rebates and other behind-the-scenes transactions a few times a year, resulting in pharmacies refunding any overpayments.

Now, PBM clawbacks happen immediately, with every filled prescription, reducing pharmacies' cash on hand. That has made it particularly difficult, pharmacists say, to stock brand-name drugs that can cost hundreds or thousands of dollars for a month's supply.

Some patients have been forced to choose between their pharmacy and their drug plan. Kavanaugh Pharmacy in Little Rock, Arkansas, no longer accepts Cigna and Wellcare Medicare drug plans, said co-owner and pharmacist Scott Pace. He said the pharmacy made the change because the companies use Express Scripts, a PBM that has cut its reimbursements to pharmacies. Related StoriesCovid and Medicare payments spark remote patient monitoring boomAn Arm and a Leg: Attack of the Medicare machinesYour doctor or your insurer? Little-known rules may ease the choice in Medicare Advantage

"We had a lot of Wellcare patients in 2023 that either had to switch plans to remain with us, or they had to find a new provider," Pace said.

Pace said one patient's drug plan recently reimbursed him for a fentanyl patch $40 less than his cost to acquire the drug. "Because we’ve had a long-standing relationship with this particular patient, and they’re dying, we took a $40 loss to take care of the patient," he said.

Conceding that some pharmacies face cash-flow problems, Express Scripts recently decided to accelerate payment of bonuses for meeting the company's performance measures, said spokesperson Justine Sessions. She declined to answer questions about cuts in pharmacy payments.

Express Scripts, which is owned by The Cigna Group, managed 23% of prescription claims last year, second to CVS Health, which had 34% of the market.

In North Carolina, pharmacist Brent Talley said he recently lost $31 filling a prescription for a month's supply of a weight control and diabetes drug.

To try to cushion such losses, Talley's Hayes Barton Pharmacy sells CBD products and specialty items like reading glasses, bath products, and books about local history. "But that's not going to come close to making up the loss generated by the prescription sale," Talley said.

His pharmacy also delivers medicines packaged by the dose to Medicare patients at assisted living facilities and nursing homes. Reimbursement arrangements with PBMs for that business are more favorable than for filling prescriptions in person, he said.

When Congress added drug coverage to Medicare in 2003, lawmakers privatized the benefit by requiring the government to contract with commercial insurance companies to manage the program.

Insurers offer two options: Medicare Advantage plans, which usually cover medications, in addition to hospital care, doctor visits, and other services; as well as stand-alone drug plans for people with traditional Medicare. The insurers then contract with PBMs to negotiate drug prices and pharmacy costs with drug manufacturers and pharmacies.

The terms of PBM contracts are generally secret and restrict what pharmacists can tell patients — for example, if they're asked why a drug is out of stock. (It took an act of Congress in 2018 to eliminate restrictions on disclosing a drug's cash price, which can sometimes be less than an insurance plan's copayment.)

The Pharmaceutical Care Management Association, a trade group representing PBMs, warned CMS repeatedly "that pharmacies would likely receive lower payments under the new Medicare Part D rule," spokesperson Greg Lopes said. His group opposes the change.

Recognizing the new policy could cause cash-flow problems for pharmacies, Medicare officials had delayed implementation for a year before the rule took effect, giving them more time to adjust.

"We have heard pharmacies saying that they have concerns with their reimbursement," Seshamani said.

But the agency isn't doing enough to help now, said Ronna Hauser, senior vice president of policy and pharmacy affairs at the National Community Pharmacists Association. "They haven't taken any action even after we brought potential violations to their attention," she said.

This article was reprinted from khn.org, a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF – the independent source for health policy research, polling, and journalism. Source:

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Any Given Saturday: New college football paradigm brings chaos, huge buyouts

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Any Given Saturday: New college football paradigm brings chaos, huge buyouts

Any Given Sunday. That’s pro football’s mantra about how even the league’s worst team is capable of beating its best.

The NFL’s average margin of victory this season: 10.8 points.

The average margin of victory in Southeastern Conference games this season? Try 10.03.

Parity — at least a measure of it — has come to college football. It’s a byproduct of the transfer portal, NIL and direct revenue-sharing. Anybody can be good these days … or at least good enough for one game.

Any Given Saturday.

Ancient Heismans in a trophy case and conference championship banners on the wall won’t hurt a program’s recruiting, but they sure don’t matter as much as they used to. This is about transactions, not tradition. The talent has spread.

In the top 10, the Associated Press poll features Indiana (2), Georgia Tech (7) and Vanderbilt (10).

Meanwhile, Penn State, Florida, Arkansas and UCLA have each already fired their coach this season. The mood also isn’t great at Florida State, Auburn, LSU or Wisconsin. There are even grumbles at 3-3 Clemson (among many others).

College football has never been this competitive, this wild — or this interesting. The fun isn’t being hoarded by a few super powers. The good teams aren’t as good and the bad teams aren’t as bad. The chase for the playoff now runs dozens of teams deep. Seasons can swing on a dime.

Two Saturdays ago, Arizona State lost to Utah by 32 points. Last Saturday, a sold-out stadium of Sun Devils stormed the field to celebrate beating then-No. 7 Texas Tech 26-22 and keeping ASU’s playoff hopes alive.

It’s fantastic.

It also has left college football in a strange place, caught between two eras.

In an earlier era, major programs that have invested heavily for generations are expected to beat the teams they have always beaten. Losses to non-name brands have traditionally been a sign of a failed operation with no hope for the future.

For example, two weeks ago Penn State should have handled a 3-2 Northwestern team the way the Nittany Lions once defeated 34 consecutive unranked opponents under James Franklin.

But we’ve entered a new day when just about any team can put together a strong roster on the fly. Even if those schools don’t surge up the polls as Indiana and others have, they can at least be competitive enough to beat you.

A new, active dollar, with money sent directly to players (or invested in top-line scouting) is more valuable than the old, passive dollar that paid for fancy locker rooms.

The result: Northwestern 22, Penn State 21. One of the difference-makers for Northwestern wasn’t a former five-star recruit, but Griffin Wilde, who caught seven passes for 94 yards and a touchdown. He arrived this season as a transfer … from South Dakota State.

Compounding everything is that programs of all sizes have asked their boosters to fund rosters, and that brings new expectations. It’s one thing to absorb a perceived bad loss when you’ve paid for a ticket to the game. It’s another when you’re helping to pay the quarterback. Rolled heads are demanded, ASAP.

Hence, Penn State fired Franklin despite his 104-45 record at the school.

Was Franklin’s dismissal justified? Or Billy Napier at Florida, or Sam Pittman at Arkansas, or Mike Gundy at Oklahoma State, or so on and so on thus far?

Sure. You get paid like these guys, you have to deliver. High salaries, high stakes. There is no such thing as “fair.”

Part of what makes college football great is that it is hardwired to reject patience and perspective, even if patient might be the exact thing programs need to be. No one was calling for Andy Reid’s job in Kansas City when the Chiefs started 0-2.

Yet here in late October, almost anyone not still in the playoff chase is thinking about canning their coach. Even a few who clearly can win the national title aren’t far removed from such discussions — do we have to fire up “The Paul Finebaum Show” from last month after Alabama lost to Florida State?

Regime change costs a fortune, yet it happens anyway. Penn State is on the hook for as much as $49 million for discarding Franklin. If Florida State cuts Mike Norvell, it owes $50 million-plus. He led the Seminoles to a 13-0 regular season in 2023. They are 5-15 since. Norvell is 44 years old. The last time Florida State won an ACC game, he was 42.

Castles crumble that fast these days.

Not everyone can win, but everyone thinks they should.

Not only are there not enough great coaches out there, and no one, in this system, can even say what makes a great coach. Old attributes such as recruiting charm or multiyear program development matter less. In-game strategy and talent identification matters more.

The margins are thin. The buyouts are huge. Half the sport is upside down.

Welcome to the chaos. Enjoy the show.

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Clemson WR Wesco out remainder of season

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Clemson WR Wesco out remainder of season

Clemson leading receiver Bryant Wesco Jr. will miss the rest of the season after sustaining a back injury against SMU this past weekend.

Coach Dabo Swinney said Monday that Wesco had a “very serious” back injury but did not disclose more details. Wesco was injured on a punt return, when he landed almost directly on his head/neck area after a low tackle sent him somersaulting in the air upside down.

Though he got up and walked to the sideline on his own, he never returned to the field and was taken to the hospital in Greenville, South Carolina, for further evaluation.

Swinney said Wesco was released from the hospital Monday and was resting at home, and that the injury could have been far worse.

“It was a very, very scary injury, and the doctors did an amazing job,” Swinney said in a teleconference with local reporters.

“The doctors are very confident he’ll make a full recovery. Definitely something that’ll keep him out the rest of this season, but thankful that all indications are he’s going to be OK. Just a real blessing for that.”

Wesco leads Clemson with 31 catches for 537 yards and six touchdowns. He thanked those who sent him prayers on his Instagram stories Monday.

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Saban: High-profile firings product of pay-for-play

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Saban: High-profile firings product of pay-for-play

Former Alabama coach Nick Saban said he isn’t surprised by the recent string of high-profile firings in college football because fans and alumni who donate money to programs now are more influential than ever because of name, image and likeness, and revenue sharing.

There have already been nine in-season firings at FBS schools this season, including six at programs in Power 4 conferences.

“You know, I’m not [surprised] because everybody’s raising money to pay players,” Saban said. “So, the people that are giving the money think they have a voice and they’re just like a bunch of fans. When they get frustrated and disappointed, they put pressure on the [athletics directors] to take action, and it’s the way of the world.”

On Sunday, Florida fired Billy Napier, who was 22-23 in four seasons. The Gators owe Napier about $21 million, with half of that buyout due within 30 days. The remainder will be paid in three annual installments starting next summer.

Penn State owes former coach James Franklin roughly $49 million after it fired him on Oct. 12. It’s the second-biggest buyout in college football history behind only Jimbo Fisher’s $76 million buyout from Texas A&M following his firing in 2023.

It’s unfair as hell,” Saban, now an ESPN analyst, told Franklin during the fired coach’s appearance on “College GameDay” last Saturday. “For you to go to the Rose Bowl, Fiesta Bowl, get to the final four [of the CFP], come out being ranked [No. 2] this year — an expectation that you created by what you accomplished at Penn State — and for those people not to show enough appreciation for that and gratitude for all the hard work that you did, I’m saying it’s unfair.”

Some of what the Nittany Lions owe Franklin, whose teams had a 104-45 record in his 11-plus seasons, might be offset by his salary at his next coaching job.

Sam Pittman (Arkansas), Mike Gundy (Oklahoma State), DeShaun Foster (UCLA) and Brent Pry (Virginia Tech) also were let go this season.

Foster, Gundy, Pittman and Pry were fired before October.

Stanford fired Troy Taylor on March 25 after two outside firms had found he bullied and belittled female athletic staffers and sought to have an NCAA compliance officer removed.

According to reports, the nine schools who have fired their head coaches are on the hook for about $116 million in buyout money, some of which will be offset if they get new jobs.

“It’s really different,” said Saban, who retired from Alabama in January 2024.

“Not in a good way from a developmental standpoint; a good way from a quality-of-life standpoint [for the players]. But we need to find a system that improves the quality of life of players but still focuses on the right stuff — development, getting an education, all those kinds of [things].”

Nine weeks into the 2025 season, the coaching carousel seems far from over. On Monday, Florida State AD Michael Alford said in a statement that a comprehensive review of the football program will occur after the season.

The Seminoles dropped their fourth straight game 20-13 at California on Saturday, to fall to 0-4 in the ACC. FSU has dropped nine straight ACC games going back to the 2024 season.

The Seminoles would owe embattled coach Mike Norvell about $54 million in buyout money. It would cost FSU about $72 million to pay off Norvell and his staff, sources told ESPN’s Andrea Adelson.

Wisconsin‘s Luke Fickell, who has a 15-18 record in his third season with the Badgers, received a vote of confidence from athletics director Chris McIntosh on Monday.

In a letter to Wisconsin fans, McIntosh wrote that the athletics department would make a stronger commitment to the football program and would move ahead with Fickell, who would be owed more than $25 million if he were fired this season.

Auburn‘s Hugh Freeze, Kentucky‘s Mark Stoops, Maryland‘s Mike Locksley, Clemson‘s Dabo Swinney and LSU‘s Brian Kelly are also catching heat after disappointing starts this season.

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