NEW YORK CITY PHARMACISTS SOCIETY
VOLUME 25, ISSUE 2 PSSNY helpline 1-800-632-8822
The Voice of Pharmacy in the Big Apple
MARCH 2016
www.NYCPS.org
President’s Message
Happy spring everyone! Actually there
are signs of a bright
spring for us already.
That is thanks, in part,
to the active involvement of over 200 of
our members -- pharmacists and
pharmacy owners -- who showed up
in Albany for Lobby Day on March 1.
Suddenly that day, our members
sprang up like daffodils in the offices
of our elected senators and legislators. There, on behalf of our profession and the patients we serve,
we urged legislators one-on-one to
tell their conference leaders to reject
the Pharmacy Reimbursement cuts
to Medicaid that we’ve been battling
for quite some time. And now good
news: our efforts found fertile ground.
Both the Senate and the state Assembly rejected the administration’s
Medicaid “specialty” drug proposal
in their one-house budget positions.
As Elizabeth Lasky has pointed out,
once again the legislature stood up
on behalf of pharmacy interests and
against these deleterious Medicaid
proposals.
As we baby boomer pharmacists
are reaching retirement age, some
issues arise in what you would think
would be an easy transition in the sale
of your pharmacy to a new owner who
wants to keep the pharmacy operating
in place. I will highlight three areas of
concern which have evolved over the
past few years. The three issues are:
(i) an uncooperative or greedy landlord;
(ii) ongoing or serious issue with a
PBM/OMIG/MFCU audit/investigation
of your pharmacy and (iii) a union shop
that the new owner is not interested in
maintaining.
Landlord Issues
First issue, your landlord refuses to
cooperate with the sale of your pharmacy
to a new owner. You may think you have
PSSNY Pharmacists (and Ms. E. Lasky) with
Senator John DeFrancisco (red tie)
continued on page 3
Page 4
IN THIS ISSUE
President’s Message.......................1
Issues That May Arise.....................1
PSSNY Legislative Update
Page 6
Page 19
Chairman’s Report..........................3
Treasurer’s Report...........................4
A Message & Greetings from
PSSNY Exeuctive Director................4
A Message from PSSNY
President Roger Paganelli................6
Secretary’s Report...........................8
NPCA...........................................10
ISMP............................................11
PAAS...........................................11
News from Around the
Pharmacy World............................12
PSSNY Legislative Update..............19
ADDRESS SERVICE REQUESTED
Ideas for Beating Margin Pressures
with Innovation in Community
Pharmacy.....................................21
The New York City Pharmacists Society
111 Broadway, Suite 2002, New York, NY 10006
OFFICERS
Ron DelGaudio, President
718-230-3535
Parthiv Shah, President Elect
718-292-4244
Aniedi Etuk, Vice-President
212-222-3652
Bill Scheer, Treasurer
917-805-4207
Jim Schiffer, Secretary
212-616-7069
BOARD OF DIRECTORS
Alex Perchuk, Chairman
718-835-2000
Charles Catalano 718-358-1300
Mike Agovino718-543-3116
Charlie Ciaccio718-452-3261
Vito Columbo718-418-9700
Jim DeTura718-292-1856
Aneidi Etuk212-222-3652
Russell Gellis212-877-3480
Carol Georgiadis718-762-7111
Roy Greif718-363-3300
Robert Hopkins
516-852-1405
Ray Macioci718-823-1085
Boris Mantell 347-276-5566
John Navarra212-213-5570
Joseph Navarra212-213-5570
Boris Natenzon718-720-3710
Roger J. Pagenelli718-364-6100
Dhiren Patel212-281-0488
Richard Schirripa646-590-1154
PSSNY REGIONAL REPS
Parthiv ShahBronx
Dhiren Patel
Manhattan
Boris Natenzon
Brooklyn, Staten Island
Robert HopkinsQueens
RECORDING SECRETARY, ACTING
Mike Agovino
718-543-3116
NEWSLETTER
Jim Schiffer, Senior Editor
212-616-7069
Designed, Printed & Mailed by:
PPM 631-231-7300
PSSNY
President’s Message
continued on page 24
If there is a “d” or “VD” on your label...
you’re deliquent or Very Deliquent. please remit.
For further information call 1-800-632-8822
Greetings from PSSNY
Executive Director
Issues that May Arise
in the
Sale of your Pharmacy
to a New Owner
RX and the Law............................23
page 2 MARCH 2016
For over 60 years, Kinray has been the full-line, full-service
pharmaceutical wholesaler for independent pharmacies.
877.857.9881 | www.kinray.com | email us at [email protected]
© 2014 Cardinal Health. All rights reserved. KINRAY and the Kinray LOGO are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners.
NYCPS NEWSLETTER
NYCPS NEWSLETTER
MARCH 2016 page 3
Chairman’s
Report
Greetings,
I hope that the warm weather reminds all of you that
Spring is here and it will be soon enough, summer is upon
us again. As you all know that we just have just concluded
our very successful annual Pharmacy owners Lobby Day
on March 1st. I would like to report to you my personal views
of this year’s Lobby Day. As I was getting on the bus at exit
14 on the NYS Thruway, I was thinking that every year we
go to Albany and we just spend an entire long day there and
see friends and colleagues. This year was no different, as we
went up in an organized, well prepared group of pharmacists.
Those in attendance included many seasoned by years of
knowledge of the pharmacy business and practice. This
year was no different even though we do have a brand new
PSSNY executive director and we do have great leadership
at PSSNY. Again this year we were well prepared and we
had 2 short messages to bring to our elected officials in
Albany. They were a PBM Audit Reform Bill and our request
to reject the governor’s proposed Medicaid Budget cuts to
Pharmacy again (any surprise?) As we got off the bus and
gathered at the Egg meeting room ,I realized that I have been
to Albany lobby visits for many many years. It was great to
see all my friends and colleagues and also great to see the
organizational skills of PSSNY staff. Even on our captain’s
call on Sunday prior to Lobby Day, I realized on how far we
have come as an organization. It’s just great to see that we
are united and ready to fight back and storm those PBMs.
As united we present ourselves in a much stronger sense
in front of the Albany legislators. We sat and listened to the
President’s Message
From page 1
Next comes the negotiations with
the Governor’s office on the annual state
budget which is due to go into effect on
April 1st. All signs point to an on-time
budget again this year, which means
finalization by April 1. So the next few
weeks represent the most intense work
on the state budget that affects us.
To those of you who did not join
us on Lobby Day, you can still make a
difference! Put pressure on your legislators at their District offices. Send a
letter now. Send an email now. It is essential to reject Medicaid fee-for-service
cuts, so please speak up loudly and say
so. There is strength in numbers if we
instructions and procedures for the day and then we went
off to our assignments. I must admit in my personal opinion
that this year’s Lobby Day was most organized and most
successful ever .So with our folders in hand we stormed the
floors of the Legislative building. All in all we had over 150
united pharmacists with 2 major and simple messages for
the legislators please protect us as pharmacy owners from
any further cuts even in the amounts that are considered
by the DOH as miniscule. We have no more room for any
more cuts. Please support the legislature that PBMs cannot
have unfair audits for anything and have to follow simple
rules for those audits. The legislators were very receptive
and understanding. This year they received us with an
understanding and respect. The legislators, many of them
our friends by now after so many years, do get the message.
Most if not all do want to carry it to their respective leaders
and these legislators have the know-how on the curvy and
difficult Albany ways. Again time will show as always, but in
my own view we had a great Albany Lobby Day 2016.Thank
you to all those that helped out and those that joined us as
PSSNY members presented our beloved profession and
asked for the possibility of survival.
Just a reminder that our state regulations regarding
electronic prescribing fully takes effect on March 27, 2016
and the MAC appeal process now is in effect you can check
with the PSSNY office for the procedure. And as always be
careful in your billing practices making sure you bill for the
precise product be it pharmaceutical or medical supply such
as blood glucose strips being dispensed. Recoveries by the
PBMs are at an all time high, and as Jim Schiffer reported
at our March 9th, CE event, the PBMs are looking for any
reason to terminate your participation. Be alert and stay
tuned and in touch.
~ Alex Perchuk
Chairman, NYCPS
make all our voices heard! There’s also
new legislation sprouting up this spring.
In our Lobby Day visits, we urged the
establishment of Pharmacy Audit Standards that are fair and reasonable. Thirty-four state, already, have these standards and procedures in place. Without
them, New York pharmacists are being
force to take away from critical patient
care time in order to address the many
unreasonable requests these audits demand. The bill we want passes allows
for Fair Notification, Fair Documentation, and Fair Results
In pressing for clear audit standards,
I was happy to serve as one of our Team
captains persuading legislative leaders.
We had a great meeting, for example,
with our Assembly sponsor, Charles
Pharmacy Day Activity
Lavine. He’s from Long Island and is
very aware of the importance of the bill.
He’s urging many of his colleagues to
sign on for its passage.
Stay well and stay informed.
~ Ron Del Gaudio, R.Ph.
NYCPS President
page 4 MARCH 2016
Treasurer’s
Corner
THE FUTURE IS AROUND THE CORNER
As discussed in previous articles changes are coming to
healthcare providers ,we are hearing about it in New York as part
of DSRIP (Delivery System Reform Incentive Payment ) ,which
is a prototype for the Value Based payment model Centers for
Medicare and Medicaid Systems is looking to bring out as the
standard for service payments. This is the switch from service
oriented payment to patient outcome based payment.
This is already being implemented in hospitals with the
yardstick being reducing the amount of readmissions to
hospitals post surgically. CMS, Health Insurance Plans and
the AMA have recently come up with a set of clinical quality
measures for the major medical disciplines and for Accountable
Care Organizations. These will encompass everything from
medication compliance the hypertensive control to adequate
A1C control in diabetics.
We are already positioned to ensure compliance with the
current MTM certifications we are utilizing in our practices. As
pharmacy pushes federally to become recognized as providers,
we will become part of the Value Based payments as well.
Increasing our value as true healthcare providers has and will
continue to raise the expectations for our ability to affect patient
quality issues. Medication Adherence programs are on the rise
,we are being drawn into the paradigm of payments, whether we
like it or not, it will no longer how many prescriptions you can fill,
but how many of your patients are compliant and maintaining or
A Message & Greetings
From PSSNY
Executive Director
March 1 Lobby Day
Makes an Impression
Thank you to everyone that participated in the Independent
Pharmacists and Pharmacy Owners’ Lobby Day. It was an
incredible show of force for pharmacy. There were nearly
200 pharmacists in the halls of the Legislative Office Building
and the Capitol educating their representatives on our issues,
specifically: Medicaid fee-for-service specialty drug price cuts
and fair audits for pharmacy. The group was very well-prepared
with their talking points and personal anecdotes on the impact of
reimbursement cuts and unfair and onerous auditing practices.
Before everyone headed out to their meetings, we were
addressed by Senator John Flanagan, Senate Majority Leader,
and Senator Martin Golden, one of our staunch supporters. They
reinforced the importance of joining together to create one voice
for pharmacy, the importance of forging relationships with your
legislator, and the importance of the pharmacist in the delivery of
healthcare.
It was an exciting day, where you ran into another group of
pharmacists every time you turned the corner, where cramming
too many people into an elevator became a running joke, and
NYCPS NEWSLETTER
showing improvements in their hypertension,diabetes,asthma,
etc. The future is here and becoming a part of the way we must
practice going forward.
While we strive to assimilate these changes we are very
much concerned with practical issues we face in our practices
daily. Having come back from Albany for Pharmacy Owners
Day after yet another successful day of lobbying for legislation to
regulate our vulnerability to these capricious audits from PBMs, I
cannot but be buoyed up by the wide acceptance by legislators
for this issue. The issue was straightforward and didn’t involve
any mention of AWP, manufacturers’ rebates or MAC pricing to
make their eyes glaze over. The issue was presented as truly
what it is, unfair, burdensome audit practices skewed at enriching
the PBM, not the payer. Already 35 states have now passed fair
audit bills in their state legislatures. We do need to follow up on
the calls we made, and those unable to attend need to pay a visit
to the local assemblyperson’s or senator’s office to keep up the
pressure to secure we become the 36th state on that list.
May 24-26 2016 brings back the NCPA Congressional
Summit ,which is the chance all pharmacists have lobby
collectively for the MAC transparency legislation, provider
status legislation, and “any willing” provider legislation. It is
a time to hear from pharmacists across the country and from
our national leadership about key legislation that is proposed
to correct current problems and bring us to the future and the
changes I spoke about before. As I said before the future is upon
us, being involved and part of the process is essential as we
see the face of pharmacy changing to assimilate into the new
healthcare paradigm. This conference will enlighten you to all
that is happening in our chosen profession. Your future livelihood
depends on your participation.
- Bill Scheer, R.Ph.
©2016 Bill Scheer
where the important business of educating your Senators and
Assembly members was the top priority.
Our concerns with Medicaid fee-for-service specialty drug
price cuts were received well—both the Senate and Assembly
budget bills removed this proposal and they will now begin
negotiations with the Governor to convince him to cut it from
his Executive budget. At the end of negotiations, the ‘three men
in a room’ will have one unified budget so it is great news that
we have two of the three in our corner, but the Governor is very
adept at these negotiations.
Fair audits for pharmacy needed a little more time and
attention. PSSNY’s proposal to hold PBMs accountable for their
auditing procedures is a new subject for our representatives and
the pharmacists did a phenomenal job explaining the tactics
frequently used in audits. Some legislative offices requested
more information, others expressed interest in co-sponsoring
our bill and many were shocked at what actually occurs in these
audits.
We have more work ahead, but PSSNY will keep you
informed of what you can do to help as the session progresses.
A special thanks to the Westchester-Rockland Pharmacists
Society for sponsoring the day and thanks to our bus sponsors:
HD Smith and the Indo-American Pharmacists Society. We
could not have had such an impact without them.
Respectfully yours,
- Kathy Febraio, CAE PSSNY Executive Director
NYCPS NEWSLETTER
MARCH 2016 page 5
page 6 MARCH 2016
A Message FROm
pssny president
roger paganelli
On March 1, PSSNY conducted its annual
“Independent Pharmacists and Owners Lobby Day”,
during which about 200 of us participated in speaking
with well over 100 legislators advocating for our
profession. Our lobby day was successful because
we were able to effectively state our case and make
our points to the senators and assembly members. I
thank all of you who took the time and made the effort
to learn the issues well enough to intelligently advocate
on behalf of all pharmacy owners and pharmacists.
As we all know, pharmacy is being besieged on
many fronts; and being successful on Lobby Day is like
an army winning a single battle, but not the entire war.
What it takes to defeat the enemies we face (PBMs,
onerous regulations, reimbursement reductions, mail
order) is for our PSSNY “army” to be INFORMED,
ENGAGED, CONNECTED and COMMITTED, far
beyond just for the two annual lobby days we have.
PSSNY is the source to keep us all INFORMED as
NYCPS NEWSLETTER
to the important issues we face on a daily basis. During
our lobby days, our focus is on the one or two most
pressing current challenges; we have experienced
greater success utilizing this method, rather than a
“scattershot” approach that covers far too many items
for legislator to deal with. We are armed with the
information that we need—for the next step—being
ENGAGED.
We need more people to be ENGAGED in our
projects, taking the information provided by PSSNY
and learning what the issues are so that we can
intelligently explain our positions. There are plenty of
ways to maintain engagement; viewing the information
on the PSSNY website (PSSNY.ORG), reading the
weekly “e-SCRIPT” which is emailed to members each
Friday, and by participating in our regional affiliate and
CE meetings. The information is there; however it
goes nowhere if we are not engaged with it. Once we
are INFORMED and ENGAGED, being CONNECTED
is the next piece of the puzzle.
What I mean by being CONNECTED is for all of
us to personally know who are the state legislators
(NYS senator and assembly members) that represent
us where we live and work. Personal connections are
incredibly valuable when we are lobbying on behalf of
pharmacy. Legislators more often respond positively
when they have connections with constituents who
come to see them, whether in their (home) district
offices, in their Albany offices, or at political fundraisers.
Pharmacy is represented at those fundraisers by our
lobbyist and practicing pharmacists; with our pharmacy
PAC (RxPAC of NY) providing contributions for those
events.
Contributions to our PAC are important, because
PAC funds are used to facilitate pharmacists’ ability to
attend functions to potentially get some face-time with
the legislators, thereby strengthening the connection.
What we need now from our pharmacy community
is for us all to be more COMMITTED in the future.
Often, too many of us leave it up to the “other guy”
to do the work. That cannot continue is we are to
be successful in our endeavors. Our profession and
businesses are dependent on all of us advocating for
Pharmacy—not just on Lobby Days but whenever the
opportunity arise. The PSSNY “army” has all the tools
to be successful—we just need to be INFORMED,
ENGAGED, CONNECTED AND COMMITTED—to win
more battles in a war that will be unending.
Stay well and stay in touch and stay informed.
~ Roger Paganelli , PSSNY President
NYCPS NEWSLETTER
MARCH 2016 page 7
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page 8 MARCH 2016
NYCPS NEWSLETTER
Secretary’s
R eport
MAR
CH
2016
Here we are as we just passed the Ides of March
and pushed our clocks ahead an hour. What exactly
is the “Ides of March”? The Ides of March is the day
on the Roman calendar that corresponds to 15th of
March. The ides of March has been marked by several
religious observances and the date March 15th has
become notoriously remembered as the date of the
assassination of Julius Caesar in 44 BC. The word
Ides derives from a Latin word which means “to divide.”
The Ides were originally meant to mark the full moon,
but because calendar months and lunar months were
different lengths, they quickly got out of step. The
Romans also had a name for the first day of every
month. It was known as the “kalends.” It’s from this
word that our word calendar is derived.
Enough for history lessons. We have a new political
agenda for saving pharmacy in New York State and
that agenda includes an aggressive attempt to pass
into law a Pharmacy Benefit Managers audit reform
statute. We should all realize more and more that if
we as a profession will survive in this strange health
care business model, we MUST be proactive at our
state government and we MUST educate our elected
state senators and assembly representatives of our
value to the citizens of our state. We need legislation
passed in Albany to protect our ability to service our
patients. With that end in mind PSSNY and NYCPS
have drafted model legislation to be signed into law
to create a balanced and fair Pharmacy Benefit
Manager procedure on pharmacy audits. You will
read about this initiative elsewhere in this newsletter.
I encourage one and all to reach out to your state
assembly representative and state senator to support
this important legislation. We need to remain vigilant
and active to protect our profession from elimination.
I now turn to a very interesting meeting at my New
York law office, in which I was involved in, and which
took place on March 10th. I had previously received
a call from a liaison for the United States Department
of State. There were three officials from the Serbian
Government who wanted to meet and discuss a
pharmacist perspective on health care in the United
States and the government administrative oversight.
I spent 90 minutes with three Serbian government
Left to right Pavle Zelic,PharmB; Nebojsa Despotovic; Jim SCHIFFER ;and Dragan
Penezic, officials of the Republic of Serbia
officials, a pharmacist, an antitrust policy maker
and a member off the Serbian energy commission
all interested in how our good old United States of
America handles the profession of pharmacy under the
regulatory scheme and business operations. As one
member of this Serbian visitors actually is a pharmacist
back in Serbia and he specializes in pharmaceutical
regulations, the others are interested in the mechanics
and the issues relating to antitrust and general effects
of regulations, for good or ill, in all fields. These officials
had already visited various cities in the United States,
specifically Washington, D.C., Seattle, Des Moines,
and Philadelphia before arriving in New York City. Due
to language concerns, the visitors were accompanied
by a State Department Liaison Officer, to serve as a
translator. From what I was told after the meeting, the
Serbian officials left very impressed with our meeting. I
did cover issues of generic competition, and the process
used by generic pharmaceutical manufacturers to get
FDA approval, I discussed Medicare and Medicaid
program activity, and I discussed my favorite topic,
pharmacy benefit managers, and the strong influential
role they play in American healthcare.
I discussed the CVS Caremark operation with
particular detail and how the pharmacy chain morphed
into a monster pharmacy benefit manager. I also
discussed government oversight of our profession with
the federal powers to levy huge fines for violators of
the federal regulations. I did leave these professionals
with one favor, I asked if pharmaceuticals were allowed
to be mailed to patients back home in Serbia. They
answered that Mail Order is not authorized in Serbian.
I strongly urged these officials to keep it that way.
Speak to everyone next month. Stay well,
- Jim Schiffer, Secretary NYCPS
NYCPS NEWSLETTER
MARCH 2016 page 9
continued on page 19
►
page 10 MARCH 2016
NYCPS NEWSLETTER
New Medicare Standard—
Does Your Pharmacy Stack Up?
In just about 11 months (Nov. 8, 2016 to be specific)
the United States will elect a new president, and there will
be countless predictions about who the nominees will be
and who will win the election. I don’t have a crystal ball for
who will win, but I do have a vantage point of talking with and
seeing national pharmacy trends. And, there are some clear
indicators for the direction for the future of pharmacy.
The biggest drivers in health care by far are the massive
policy changes that the federal government has taken in just
over a decade. It was just 12 years ago that Medicare Part
D was pushed through the Republican controlled Congress
and the Bush Administration, changing community pharmacy
forever. Similarly, the Affordable Care Act (“Obamacare”) was
pushed through a Democratic controlled Congress, and its
impact is rippling through all of health care.
The Centers for Medicare and Medicaid Services (CMS)
has recently made two major announcements that are going
to be an advantage or disadvantage for your pharmacy,
depending on your response. First, earlier this fall they
announced an expansion of the Part D MTM program.
Also this fall, CMS announced its “cut rates” for
comprehensive medication review (CMR) completion rates.
Earlier in the year, CMS reported that only 11 percent of Part
D beneficiaries currently participate in the MTM program,
and that 25 percent of beneficiaries could benefit from the
program. CMS clearly wants more patients to benefit from
CMRs. That’s why they added CMR completion rates as a
quality measure for Part D plan star ratings starting Jan. 1,
2016.
The “cut rates” (think of them as thresholds) are as
follows:
TYPE 1 STAR 2 STAR
3 STAR
4 STAR
>13.6% to < 36.2% >36.2% to <48.6% >48.6% to <76.0%
MA-PD <13.6%
PDP<8.5%>8.5% to <16.6%
>16.6% to <27.2% >27.2% to <36.7%
One way to think about the star ratings is like grades on a
report card, with 5 stars being an “A” and 1 star being an
“F”. Part D Plans with 4 or 5 stars get rewarded with higher
placement on planfinder.gov and year round enrollment (for 5
star plans). Plans with less than 3 stars get penalized and are
in danger of a plan “death penalty.” Score less than 3 stars
three years in a row and CMS can tell the plan to turn out the
lights—no more plan.
So, finally, Part D Plans will be motivated to do more than
just go through the MTM motions as most plans do today.
Instead, if your pharmacy contributes to a Plan achieving a 4
or 5 star rating, it has more value to the plan. The converse is
also true.
Keep in mind that the 2016 CMR completion rates will be
based on 2014 data. In other words, there is a latency period
between performance and star ratings; in other words, how
your pharmacy performs this year will be how it is judged in
2017.
There are precious few days left in this year’s calendar to
affect your 2017 CMR completion rates as well as other star
measures such as adherence to make your pharmacy more
attractive to plans. I can tell you that the large mega chains
have gotten this message and are doing an end of the year
push to improve their CMR completion rates to better position
themselves for 2017 networks. Even though your patient
service is vastly superior, you could be “out-starred” by the
competition. Don’t let that happen.
There is a lot going on at the end of the year and business
is often busier with cold and flu season starting, but whether
your MTM cases come from Mirixa, Outcomes, or another
source, make it a point to do them. Keep your CMR completion
rates as high as possible to position your pharmacy for the
future. That prediction is a sure bet.
- B. Douglas Hoey, RPh, MBA
National Community Pharmacists Association CEO
NYCPS NEWSLETTER
MARCH 2016 page 11
Medication Safety • Preventing Errors
By the Institute for Safe Medication Practices
“Have you experienced a medication error or close call? Report such incidents in confidence to the ISMP National Medication Errors
Reporting Program (ISMP MERP) at 1-800-FAIL-SAF(E) or online at www.ismp.org to activate an alert system that reaches manufacturers, the medical community, and FDA. ISMP guarantees confidentiality of information received and respects reporters’ wishes as to the
level of detail included in publications.”
Sig code shortcut to error. Upon reviewing the refill
of a prescription for HYDROcodone and acetaminophen
5 mg/500 mg, it was discovered that the directions printed
on the pharmacy label were “Test 4 times daily” instead
of the intended “Take 4 tablets daily.” The patient had
been receiving the prescription at the same dosage for
over a year without any changes so he continued to take
the prescription correctly. The pharmacy’s investigation
revealed that the error likely occurred because of a mixup of Sig, or short codes, used to enter directions for
use into the pharmacy computer system—“T4TD” was
used instead of “T4TDA.” Pharmacists should routinely
run reports of system Sig codes in use. Evaluate the Sig
codes being used in their computer systems and remove
ones at risk for error. At the point-of-sale, pharmacy
staff should review each prescription container with the
patient, even if this means opening up the bag.
Prevent unintentional medication overdoses. An
outreach worker visited the home of a patient with active
tuberculosis to administer a dose of the oral antitubercular
agent isoniazid to the patient’s 2- and 4- year-old
children. After administering approximately one-half of
the dose to the 2-year-old, the child vomited. The syringe
containing the remainder of the dose was laid down on a
table while the child was cleaned. The 4- year-old child,
who had already received his dose of medication, picked
up the unsecured syringe and ingested the remainder of
the medication. As a result, he received approximately
800 mg of isoniazid total. Thankfully, the child was not
harmed. This case should serve as a strong reminder to
keep all medications secured and out of the reach and
sight of children, even if the caregiver is in the same
area as the child. It is also important to teach children
about medication safety, to tell them what medicine is,
and why their parent or caregiver must be the one to
give it to them. More than 60,000 young children end
up in EDs every year because they got into medicines
while their parent or caregiver was not looking. For
more information and strategies to protect children from
unintentional medication overdoses, visit the Up and
continued on page 25
Proof of Proper Diagnosis for Transmucosa
Immediate Release Fentanyl (TIRF)
Transmucosa Immediate Release Fentanyl (TIRF)
is only indicated for cancer pain and must not be used
for other pain purposes. Recently pharmacies have
received letters from various health plans seeking to
recoup payment for TIRF (e.g. Subsys 200mcg Spray)
drugs where no proof of proper diagnosis or use has been
verified prior to dispensing. At CMS’s direction, some
PBMs have initiated a “deletion of the Prescription Drug
Events (PDEs) which will result in reversal and recovery of
the identified claims previously payable to the pharmacy.”
This can result in a recovery of as much as $5500 or more
per event!
Additional warning was given to the pharmacy for not
following DEA regulation 21 CFR 1306.04, stating that
“pharmacists have a corresponding responsibility (with
prescribers) to ensure that controlled substances are
used for a legitimate medical purpose.”
§1306.04 Purpose of issue of prescription.
(a) A prescription for a controlled substance to be effective
must be issued for a legitimate medical purpose by an
individual practitioner acting in the usual course of his
professional practice. The responsibility for the proper
prescribing and dispensing of controlled substances is
upon the prescribing practitioner, but a corresponding
responsibility rests with the pharmacist who fills the
prescription. An order purporting to be a prescription
issued not in the usual course of professional treatment or
in legitimate and authorized research is not a prescription
within the meaning and intent of section 309 of the Act
(21 U.S.C. 829) and the person knowingly filling such a
purported prescription, as well as the person issuing it,
shall be subject to the penalties provided for violations
of the provisions of law relating to controlled substances.
Humana states, “use of TIRF medications for indications
other than FDA approved indications is counter to FDA
approved labeling and prescribing information, as well
as the TIRF REMS ACCESS Education Program and
Knowledge Assessment provided to and completed by all
pharmacies who dispense TIRF products, and represents
a serious safety concern for Humana’s members.”
PAAS National® reminds pharmacies to follow the
law in dispensing these products by verifying that they
are used for cancer pain only and to document such
verification on the face of the hard copy prescription.
If you have any questions email PAAS National® at
[email protected] or call 888-870-7227.
page 12 MARCH 2016
NYCPS NEWSLETTER
2016
H
RC
A
M
Jim Schiffer Reporting...
News from Around
The Pharmacy World
MARCH 2016 EDITION
Presidential Politics
As we watch the various state primaries take place we
are getting to see the dwindling list of presidents to follow
President Barack Obama. Who will it be? Ted Cruz, Hillary
Clinton, Bernie Sanders, or Donald Trump? Will John Kasich
stand a chance against the Donald? It is a very strange time
for politics in this country. There is definitely a resentment of
the do nothing Congress we have had in place for the past
few years. The voters are fed up, but will the electorate put a
newcomer such as Donald Trump in the White House? How
would the Donald act as President Trump? Well let us take
apart his discussions on health care so far. Mr. Trump got
confused during one debate and did not know the distinctions
between Medicare and Medicaid. (Not a good sign). Mr.
Trump is also anxious to bring competitive bidding to the
Medicare Prescription Drug program in order to ratchet down
the costs of the medications. Mr. Trump also appears to be
interested in the legalization of prescription drug importation
from European countries. (I do not think that will be helpful to
our pharmacy profession- but will President Trump actually
do that?) Who knows?
We all know that Secretary Hillary Clinton has experience
with health care reform from her days as First Lady and her
days with President Obama as Secretary of State. Secretary
Clinton is well aware of the problems we pharmacists face with
limited access networks, as well as the short supply of certain
medications thus driving the price up even. If Mr. Trump
wins the Republican nomination and Secretary Clinton wins
the Democratic slot, it will put two polar opposites in position
for the highest office of the land. Which would be better for
independent pharmacies? I would have to bet on Secretary
Clinton because of the nature of Mr. Trump’s business behavior.
Mr. Trump has already appeared to be someone who is not
worried about small business interests and instead is worried
about the big picture. On the other hand, Secretary Clinton
has experience with mom and pop pharmacies when she was
first lady of Arkansas while her husband, former President Bill
Clinton was in the governor’s mansion in Little Rock. Arkansas
is a somewhat strong base of independent pharmacies and
during the Clinton administration in Arkansas there was initially
a cold relationship between independent pharmacies and the
governor’s office. Former President Clinton served as governor
in Arkansas with a gap in his re-election as he was spanked
out of office in his first term. He had to come back with some
humble pie on winning that office back. Arkansas pharmacists
took credit as part of that rehabilitation of Bill Clinton. All of this
is of course speculation but it makes for interesting discussion.
Keep watching the news stations for developments.
Pharmaceutical Industry Issues
It seems that there is an increased focus on the brand
name pharmaceutical industry based on the pricing issues
and related scandals of Turing Pharmaceuticals, Valeant
Pharmaceuticals and Horizon Pharma. The concept of
grabbing “worn out” brand name products and rehabilitating
them into new-fangled uses with much higher prices is
catching quite a bit of adverse publicity. Valeant’s troubles
began late last year when issues were brought out about its
drug pricing and allegations that it was using a pharmaceutical
distributor Philidor RX Services (a private mail order pharmacy
operation) to inflate revenue in its dermatology business.
Valeant is located in Quebec and since this scandal broke,
Valeant has broken off any relationship with Philidor, which
incidentally has gone out of business. It is public knowledge
that Valeant is under investigation by the U.S. Securities and
Exchange Commission over its relationship with Philidor.
Valeant is also the subject of U.S. state investigations for steep
price increases on some drugs. The price of Valeant stock
has dropped significantly in the past few months from a high of
$262.25 back on August 5th 2015 to a current price on March
16th of $33.54 due to all of the baggage which has been
exposed. Moving onto Horizon Pharma, on March 15, 2016 it
was announced that Horizon Pharma gave their CEO Timothy
Walbert a nice $93.4 million pay package for 2015, which
represented a 10-fold increase from the previous year even
as the company came under fire for their distribution practices.
Mr. Walbert received stock options valued at $47.4 million and
$43.5 million in restricted shares, according to a preliminary
proxy filed in mid-March. Many goals over the next 18 months
must be met for Mr. Walbert to actually be given these actual
continued on page 14
NYCPS NEWSLETTER
MARCH 2016 page 13
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NYCPS NEWSLETTER
Around the Pharmacy
From page 12
options. Incidentally his pay package
for 2014 was a measly $8.97 million.
Horizon Pharma has created a number
of pharmaceuticals combining existing
medications into novel new products.
Such as combining famotidine with
ibuprofen and capturing sky high pricing.
The FDA has no choice but to approve
of such novel combination products if
they meet standard FDA safety and
efficacy guidelines. Turing has faced
heated criticism since September after
the company bought the 62-year-old
drug Daraprim and hiked its price to
$750 a tablet from $13.50. Enough said.
Medicare Updates
Every time the Centers for Medicare
and Medicaid Services (CMS) tries to
bring common sense to an aspect of
the Medicare program they get beat
up in the press. Under Medicare Part
B, the part of Medicare that handles
payments to physicians as well as
covering medical supplies and certain
medications is trying to rein in some
of the excessive payments. It seems
under Part B, physicians who administer
medications directly to the patient, the
reimbursement rate for such drugs has a
payment scale which is tied to the cost of
the medications. CMS is trying to modify
payments to physicians who administer
such medications which currently
favors the physician administering more
expensive pharmaceuticals over less
expensive ones since there currently
exists a disparate payment methodology.
The changes would be a test for 5
years, and the first change that CMS
Innovation office would test under this
pilot program would be to pay 2.5%, plus
a flat fee of $16.80 (instead of 6% of the
cost of the drug ) on top of the Average
Selling Price (ASP). That converts the
reimbursement rates to physicians
would go up for less expensive drugs
and the reverse, or downward for the
more expensive drugs.
The CMS estimated in the proposed
rule that Part B payments to medical oncologists which reached $1.2 billion in
2014, including the acquisition costs—
would decline by 0.7%, compared with
a 1.3% increase across all specialties. The proposal seems logical and
long overdue especially in light of what
pharmacy owners have faced in the
reimbursement saga for Medicare Part
D and the state administered Medicaid
programs, which currently pays peanuts
(or as some feel only the empty peanut
shells!!) I personally think the proposed
change should be approved
in spite of the opposition from
the affected physician groups.
In spite of the possibility that
some physicians would actually end up with higher payments,
the proposed plan would deliver a financial hit to those physicians in a limited number of
medical specialties, specifically
oncologists, ophthalmologists
and rheumatologists, who earn
significant percentage of their
overall revenue from Medicare’s current and longstanding payment methodology by
paying them a drug’s average
sales price, or ASP, plus 6%.
“It’s basic economics, if
you look at oncology practices,
the majority of the revenue
is coming from drug sales,”
claims Neeraj Sood, who
serves as director of research
at the Schaeffer Center for
Health Policy and Economics
at the University of Southern
California. “Doctors are human.
The fact is, this model changes
how much money they’ll make.”
Let’s see how this shakes out.
This one I favor the government
over the physicians.
continued on page 16
NYCPS NEWSLETTER
MARCH 2016 page 15
page 16 MARCH 2016
NYCPS NEWSLETTER
Around the Pharmacy
From page 14
Chain News
Walgreens continues to pursue
their pending marriage with Rite Aid.
According to industry sources, the
Federal Trade Commission is looking
at this merger with some degree
of skepticism especially where the
two pharmacy chains have a very
strong presences (particularly in the
northeastern states). There are rumors
that the combined chain will have to shed
at least 500 to maybe 1,000 locations
to get federal approval of this monster
merger. In the meantime, Walgreens
has announced a unique “partnership”
with United Health Care and the patients
served under UHC health insurance
policies. As you should already know,
UHC owns and operates the OPTUM
pharmacy benefit manager. And as you
may realize, OPTUM has purchased
(last July it became official) Catamaran
Pharmacy
benefit
management
operation including their free standing
specialty pharmacies. OK, enough
with PBM history now for the news,
Walgreens is now going to be able to
supply UHC patients a 90 day supply
of medications at the same copayment
charged under the mail order option.
This directly competes with the CVS
Caremark option which exists at the
CVS retail pharmacies throughout the
USA. Besides accepting a lower rate
of reimbursement from UHC for these
prescriptions, I suspect that Walgreens
also demanded full access to all of
the UHC networks, which had been a
problem in New York and other areas
of UHC concentration. Over the past
twelve or so months, Walgreens has
been excluded from a couple of the New
York Medicaid Managed Care networks
run by UHC. Time will tell if this new
partnership is worth the time and effort
of Walgreens. In the meantime, this new
“partnership” is just another example of
the extremes that health insurers and
pharmacy providers will go through to
shave dollars off of their operational costs
in large part due to the strains put on
the system as a result of the Affordable
Care Act and the failure of the healthy
young uninsured folks from enrolling in
the program. The folks that do sign up
for such coverage are usually in need of
care for a serious health care situation.
Although the structure of the Affordable
Care Act mimicked the Medicare Part
D program in many respects, what it
failed to capture was the penalty aspect
of the Medicare Part D program. In the
Part D program, if you fail to enroll when
you become 65 years of age, for every
month you do not have coverage under
Part D or have substitutable coverage
from your existing health plan (known
as “Credible Coverage”) then you are
assessed a permanent penalty of 1% as
a surcharge for each month that you fail
to have such coverage. So if you fail to
get coverage for one year you will have
a 12% surcharge on any premiums
going forward when and if you do get
coverage. Two years converts to a 24%
penalty, three years 36% and so on. If
the ACA had instituted such a surcharge
for failure to have coverage, it might
continued on page 17
NYCPS NEWSLETTER
MARCH 2016 page 17
Around the Pharmacy
From page 16
have had better success having the
young and healthy individual patients
enrolled to strengthen the pool of eligible
patients. But what do I know???
CVS Caremark continues to
succeed in their image as more than
just a pharmacy with their emphasis
on health, first by removing the sale of
tobacco products from their pharmacies,
then by increasing the presences of their
in store health clinics known as Minute
Clinics. Currently there are over 1,000
Minute Clinic locations inside CVS/
pharmacy stores in 33 states as well as
the District of Columbia. Minute Clinics
offer diagnosis and treatment of minor
illnesses, injuries and skin conditions;
administration of vaccinations, injections,
health screenings and physicals; and
monitoring for chronic conditions. Minute
Clinics has created clinical affiliations
with 28 of the largest hospital systems
in the United States. As of 2015, Minute
Clinics have cared for over 18 million
patients with a very high rate of satisfied
patients. CVS Caremark is continuing to
grow in the pharmacy benefit world. One
wonders if Walgreens regrets selling
off their Walgreens Health Initiative
pharmacy benefit manager to Catalyst
Rx. Then a serious of changes occurred.
SXC Health Initiatives (SXC also owned
Health Business Systems pharmacy
computer platform) then purchased
Catalyst Rx. Eventually SXC Health
Initiatives /Catalyst RX formally changed
their name to Catamaran Rx which was
then purchased in July 2015 by United
Health Care. A confusing trail isn’t it?
With the pending acquisition of Rite Aid
by Walgreens (pending FTC and Justice
Department approval) Walgreens will be
back in the PBM game by the inclusion
of Envision Rx in the Rite Aid purchase.
I have a proposition, and here it
is. Now that Walgreens is forming a
partnership type of working relationship
with United Health Care, it seems logical
to say that Walgreens has aligned
themselves with Optum Rx. And any
talk of Walgreens merging with or
acquiring Express Scripts Inc. (ESI)
now seems very unlikely.
Express
Scripts stock took a hit dropping 2.5%
as soon as the Walgreens/ UCS working
partnership was announced. Why?
Express Scripts now seems like a lost
soul. What will happen with Express
Scripts? Are the vultures circling the St
Louis headquarters of ESI? Who knows
but stay tuned.
Folks enough for our March newsletter. The year promises to be an interesting one. I am looking forward to
attending the annual National Community Pharmacist Association annual
legislative meeting this year known as
the Congressional Pharmacy Summit
in Washington DC in mid-May. Every
four years when we have a presidential
election (especially when the incumbent
president is not able to run for reelection)
it is extra exciting to attend. I will report
on the meeting in a few months as we
have some time before the meeting actually takes place.
- Jim Schiffer
©2016 James R. Schiffer
page 18 MARCH 2016
NYCPS NEWSLETTER
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NYCPS NEWSLETTER
PSSNY
Legislative Update
This is an update on several key issues, which affect the practice
of pharmacy here in New York State. You should already be familiar with the terms relating to these proposed pieces of legislation.
State Budget
Again this year, independent pharmacy owners who
spent the day in Albany on March first were validated when
the Senate and Assembly released their one-house budget
bills on Saturday, March 12th. Both houses fully rejected the
Governor’s Medicaid proposal to develop a list of “specialty
drugs” and to remove them from the current AWP-17% brand
reimbursement. The new benchmark would definitely be
lower, estimated by Medicaid officials to be at AWP-19.6%.
This marks the third consecutive year in which both the
Senate and Assembly stood firmly with pharmacy interests
against the Governor’s proposed cut. Pharmacy’s often
repeated position that any further cuts are unsustainable has
apparently taken root with legislators, based on these direct
exchanges with their pharmacy owner constituents.
The release of one-house budgets launched the next phase
in the budget process. This phase involves three-way negotiations
and poses a greater danger. Although the Senate and Assembly
have agreed to reject the pharmacy cut up to this point, they will
need to hold firm to this position. The one-house bills reflect very
different spending priorities for which dollars will have to be found.
At this point the Governor and Medicaid officials
have a strong hand. What all this means is that
efforts to defeat the Medicaid “specialty drug”
initiative will continue until the budget is finalized
on or before April first. Pharmacists who have
established good rapport with legislators should
stay in touch. Thank legislators for their work
in the one-house bills and remind them of the
reasons why rejecting this budget proposal
means so much to pharmacies and especially
to Medicaid patients who rely on the targeted
medications to manage serious medical
conditions.
Fair Audits
Assemblyman Charles Lavine (D-Nassau) is the prime sponsor of Assembly bill
A9424, working closely with Assemblyman
Richard Gottfried (D- Manhattan), chair of
the Assembly Health Committee. In the
Senate the bill is under review in the offices of Senators Kemp Hannon (R-Nassau),
chair of the Senate Health Committee, and
Senate Majority Leader Senator John DeFrancisco (R-Syracuse). Many other legislators are interested and may sign on as
co-sponsors in the coming weeks.
MARCH 2016 page 19
At the request of these key legislators, we have compared
the provisions in A9424 with laws now in effect in thirty-four
states, noting which elements are standard, such as:
• Prohibit payments based on percentages of
recoupment amounts;
• Prohibit recoveries for clerical errors (defined as an error that
produced no financial harm to the consumer, health plan or
employer-sponsored benefit;
• Prohibit documentation requirements that go beyond
NYS or FDA;
• Prohibit extrapolation to identify claims incorrectly presented;
• Require a complete list of prescription numbers with
the audit notice;
• Require adequate notice, return receipt requested or
electronic confirmation of receipt;
• Allow the pharmacy to validate claims with signature logs,
delivery receipts, signed statements from patients and
documentation from the prescriber’s records; and
• An exception for fraud, among others.
The legislation also defines reasonable parameters for invoice
audits. This part of the bill is not standard. It was developed by
pharmacists based on recent audit experiences.
Pharmacists who attended Independent Pharmacy Lobby
Day generated considerable interest in fair audit legislation, and
co-sponsors are emerging. According to the session calendar,
legislators are expected to be at home every Thursday Friday in
April as well as two full weeks from April 14 to May 2. Watch for
action alerts with updated information so that you can follow up
with a meeting in the legislator’s district office to respond to any
questions and generate even more co-sponsors.
- Elizabeth M. Lasky, Capital Public Affairs, Inc.
page 20 MARCH 2016
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MARCH 2016 page 21
Ideas for Beating Margin Pressures with
Innovation in Community Pharmacy
Challenges to the independent pharmacy community are
fast and furious and 2016 appears to be no different than past
years in terms of change and opportunity. “Think outside the
box” is the quick message, but a deeper dive into the trends
and options available to independent pharmacies drive an
understanding of what can lead to change and growth.
One recent challenge is the impact of changes in Direct
and Indirect Remuneration (DIR) fees. For the full story,
review the NCPA hearings with CMS on how these fees are
calculated and what that means for a pharmacy’s bottom line.
One thing is certain, DIR fees will continue to affect gross
margins for community pharmacies as well as big box and
chain stores. It is important to ensure a store’s contracted
Pharmacy Services Administrative Organization (PSAO) is
helping to identify DIR fee changes and is adept at negotiating
with third-party payors.
Consolidation within the industry continues to move at a
breakneck pace: for starters, CVS with Target and Omnicare,
Walgreens with Rite Aid, just over the past few years alone.
The financial strength of the mega chains offer the big box
formats ample room to grow, build on real estate with parking,
and provide drive-through windows and the like in convenient,
high traffic areas.
Competition will remain fierce among pharmacists as more
and more newly minted professionals enter the job market
each year. The output from professional college programs
simply outstrips market demand. This trend can also affect
community pharmacy as pharmacists displaced by the influx
of new recruits can drive seasoned professionals to seek
startups where they live¾a trend also indicated by the higher
number of startup funding requests at lending institutions. The
pressure to keep independents independent is also prevalent
from both a prescriber and patient perspective. Health plans,
distributors and manufacturers also have an interest in
maintaining a high-performing independent pharmacy pool.
Innovate for Growth
While changes to reimbursements and narrow networks
have posed threats to margins over the past three years, it is
not all gloom and doom for the independents. Innovation is the
key driving force for 2016. Several initiatives, often coupled
with widely available technology solutions, have paved the
way to drive new income for the future. Independents can
combat bottom line pressures with services that make sense
for their community.
Each of these initiatives also play a role in the availability
of funding for startups and acquisitions as well as in the selling
prices for existing businesses.
Medication synchronization or “med sync” is one sure
way to help the bottom line, increase interactions with
patients and develop relationships with prescribers. Med
sync coordinates the refill orders for patients requiring three
or more medications per month on the same day. A program
can be developed with either a low-tech or high-tech solution
that offers advanced reporting and measurement of success.
Coordinating scripts also increases patient adherence and
facilitates harmonization with prescribers.
A Medication Therapy Management (MTM) program
and patient adherence packaging solution is often added
to the med sync program. These scheduled one-on-one
consultations provide an opportunity to drive patient adherence
and build customer relationships. Adherence not only keeps
patients healthier, but also increases script counts. A study by
the NCPA found that 21 percent of patients enrolled in a med
sync program are less likely to discontinue treatment and 2.5
times more likely to be adherent to medications.
Patient-centered care is the wave of the future.
Personalized service cultivates loyalty and trust for longterm relationships with customers. Convenience is a factor,
too. Consider technology for refills or reminders. An online
presence is essential allowing current customers to access
services in the format they prefer, or in many cases educating
a caretaker for a customer.
Innovate. Deliver better care than your competitors.
This will help compensate some of the challenges of falling
reimbursements. In fact, pay for performance measures, such
as those determined by the Centers for Medicare & Medicaid
Services Five Star Quality Rating System, are directly affected
by adherence measures. Plans that receive the highest
ratings pass along bonuses to individual pharmacies.
Many independent pharmacies have gained traction by
offering compounding services onsite or at a complementary,
ancillary facility. With new technologies available, more
pharmacists can expand highly personalized service levels
by creating solutions for unique patient needs. Compounding
medications provides a tailored approach to wellness. It
enables complimentary disease state management, drives
customer loyalty and delivers solid margins. It also enhances
working relationships with prescribers, adherence measures
and patient interaction for success in expanding business.
Consider becoming an expert in a disease state with
specialty medications. This growth area offers advantages
for prescribers and patients seeking attentive care for those
requiring specific regimes for diseases such as HIV, Hepatitis
C, Rheumatoid Arthritis, Organ Transplants and Multiple
Sclerosis. These treatments run $600 or more. In addition,
specialty favors community pharmacies offering an in-person,
high-touch approach.
It begins with the referrals from the physicians, and is
dependent upon managing the communication continuum
(doctor, patient, pharmacist, manufacturer).
Research
evolving technology solutions that are bridging these gaps.
A New World of Marketing
Independent pharmacy will continue to be challenged
by the financial resources that chain and PBM’s use for
targeting your customers. Predatory marketing is luring
unwitting patients to specific branded pharmacies. From
targeted messages in prescription plan member materials to
online, telemarketing and direct mail campaigns, tactics are
continued on page 26
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page 22 MARCH 2016
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MARCH 2016 page 23
WRONGFUL CONDUCT RULE
This series, Pharmacy and the Law, is presented by Pharmacists Mutual Insurance Company and the New York City Pharmacists Society through
Pharmacy Marketing Group, Inc., a company dedicated to providing quality products and services to the pharmacy community.
A recent decision in West Virginia is garnering a
lot of attention in the pharmacy profession and beyond.
The 8 cases involve suits by 29 patients alleging that
actions by physicians and pharmacists have caused
them to become addicted to and abuse controlled
substances. They also alleged that the pharmacies
acted in concert with the prescribers by such actions
as refilling prescriptions early and filling contraindicated
prescriptions. After some years of prescribing by the 4
physicians involved, and dispensing by the 3 pharmacies
involved, an FBI raid resulted in arrests of some of the
health professionals. Some physician licenses were
revoked and some were convicted and served prison
time. However, only 1 pharmacy and 1 pharmacist were
disciplined (the court decision does not indicate that
there were any criminal charges).
As the cases progressed, the plaintiffs all admitted to
various crimes during the time that they were receiving
and filling prescriptions for the various controlled
substances. These included criminal distribution, buying
drugs off the street in addition to those prescribed,
acquiring prescriptions through misrepresentation,
fraud or forgery, and doctor shopping. Because of
these criminal activities, some of the defendants filed
a motion to have the case dismissed on the basis of
the Wrongful Conduct rule or the in pari delicto (in equal
fault) doctrine. These two concepts have similar origins,
but in pari delicto is used more commonly in contractual
or transactional disputes. The premise of the Wrongful
Conduct rule is that someone who is injured while
performing an immoral or criminal act should not be able
to recover damages for that injury. The Court quoted
another case to explain the rationale for the rule; “. .
. public policy that courts should not lend their aid to
a plaintiff who founded his cause of action on his own
illegal conduct.” The trial court agreed to dismiss the
cases, but then sent certified questions to the Supreme
Court of Appeals.
The Supreme Court of Appeals declined to invoke
the Wrongful Conduct rule in West Virginia because the
majority believed the rule was too ambiguous and difficult
to apply. They ruled that the jury would take the criminal
activity into account when apportioning fault under West
Virginia’s comparative fault laws. In West Virginia, if the
plaintiff is 50% or more at fault, then they cannot recover
any damages. The Court said that comparative fault will
essentially take the wrongful conduct of the plaintiff into
account, so the Wrongful Conduct rule is unnecessary.
There were 2 dissenting opinions that disagreed
with the majority that the rule would be difficult to apply.
The dissenting opinions said that it is straightforward;
a person should not be able to recover for injuries
sustained while committing a crime. Thirteen other
states have already adopted the rule. By not invoking
the rule, the Court will encourage other criminals to file
suits to attempt to profit from their criminal activity. In
these particular cases, they contend that the Court is
allowing these plaintiffs to clog up the court docket and
waste the court’s time.
What does this mean for pharmacists? It’s important
to recognize that there has been no trial and no judgment
on the facts of these cases. The decision does not
mean that the pharmacists or physicians are liable. This
opinion is a procedural one that places the eventual
resolution of the case in the jury’s hands instead of the
judge’s hands. Many readers have probably already
formed an opinion about the correctness of the decision.
For pharmacists, the real issue is to try not to get involved
in such a case in the first place. While this is not always
possible, it should be a goal. The monitoring and
dispensing of controlled substances is difficult at best.
Pharmacists are no longer “order takers” subservient
entirely to the doctor’s orders. Pharmacists should be
active and diligent in monitoring all of their patients,
but especially those with unusual controlled substance
needs. Pharmacists need to educate themselves about
their patients’ needs. There are plenty of reference
articles about effective pain management to consult.
Pharmacists also need to educate themselves about
their responsibilities as health care professionals. The
tightrope between patient needs and good stewardship
of controlled substances is not easy to navigate, but
ignoring the issue is not a solution.
1. Tug Valley Pharmacy, LLC, et al. v. All Plaintiffs below in Mingo County Cases,
No 14-0144 (Supreme Court of Appeals of West Virginia, May 13, 2015.)
2. Orzel v. Scott Drug Co., 537 N.W.2d 208, 213 (Mich. 1995.)
© Don R. McGuire Jr., R.Ph., J.D., is General Counsel,
Senior Vice President, Risk Management & Compliance
at Pharmacists Mutual Insurance Company.
This article discusses general principles of law and
risk management. It is not intended as legal advice.
Pharmacists should consult their own attorneys and
insurance companies for specific advice. Pharmacists
should be familiar with policies and procedures of their
employers and insurance companies, and act accordingly.
page 24 MARCH 2016
NYCPS NEWSLETTER
Issues That May Arise
From page 1
a fantastic marriage with your landlord when you suddenly
discover the relationship is far from fantastic. There are key
provisions that you should have in your lease which will assist
(but not guarantee) that you can either assign your current
lease to a new owner or that the new owner can obtain a new
and extended lease to continue to operate your pharmacy at
that location. I have seen leases which provide for the landlord
to allow the assignment (transfer) of the lease to another
potential pharmacy owner so long as that potential owner
can demonstrate that they have sufficient assets and ability to
run the pharmacy in a way that it will continue to function in a
profitable way. Key phrases need to be in your lease, which
include that in the event of your request of an assignment of the
lease, the landlord shall not unreasonably withhold, condition
or delay the approval of such a request. Even having such
language sometimes finds a landlord who continues to stone
wall such efforts to transfer ownership. Sometimes you need
to use public embarrassment to the subject landlord to affect
the request changes. There have been other instances where
I (on behalf of the pending seller client) was forced to pay a six
figure amount to obtain landlord consent to a transfer of the
lease in spite of that overall (what appears to be tenant friendly)
language. The landlord said, “take me to court go ahead, it will
slow down and maybe kill your pending sale”. Also in the event
you have interest in selling to a local chain pharmacy, be aware
that normally the chains require a period of darkness post sale of
your premises, and the landlord may object. Also some leases
do not allow the pharmacy to be closed (even if you are willing
to pay rent during the “dark” period, as the lease may require
an active pharmacy on premises, so that can be a problem).
Also, a warning too on “Good Guy clauses”. A good guy
clause can take many different forms. It traditionally protects a
tenant whose principal(s) personally guarantees the rent to the
landlord. In the event you are selling your pharmacy to a chain,
the good guy guarantee does not give your business protection
in the event of a sale. Some landlords threaten to pursue a
claim against the business entity for breaking the lease (and
while allowing the “good guy guarantor freedom”), it may mean
that your business will be a defendant in a lawsuit brought by
your unhappy landlord to enforce the lease. Another point, be
careful on how long your lease is written for. It is better to have
a 5 year lease with two five year options (at your exclusive
control), instead of a straight 15 year lease which could tangle
you up for a long long time and keep you on the landlord hook.
Audits/Investigations
Next issue is audits and investigations to be concerned
with. If you have an ongoing PBM audit, be careful that the
audit is not headed toward an expulsion of your pharmacy
for a period of time. CVS Caremark as well as OPTUM/
Catamaran and Express Scripts have become very bold about
terminations. And if you get terminated, the location is normally
tainted (or as I call it radioactive) for the length of the announced
PBM expulsion. Selling the pharmacy to your grandmother, or
your pet poodle, or a friend or other family member does not
usually help get a provider number with the PBM who threw
you out of their network. I have seen innocent pharmacists
enter into a lease at a location that had been a pharmacy
in the past but has snice closed up. If that pharmacy was
closed due to a PBM or government audit and investigation,
even a new pharmacy operator attempting to obtain provider
numbers from the terminating PBM or insurance entity will be
very difficult and might not occur whatsoever. Be informed
as to the location’s status and seek counsel of a competent
attorney with pharmacy knowledge in his/her belt. If you are
under a OMIG or NY Attorney General (AG) Medicaid Fraud
Control Unit (MFCU) investigation, that may take several years
to conclude. The NY AG MFCU is behind about two to three
years on resolving open (and many are not criminal in nature)
investigations. Such an investigation may hamper a new
owner from obtaining NY Medicaid approval. You may say who
needs NY Medicaid, but don’t be naïve. CVS Caremark, as
well as OPTUM, and Express Scripts will eventually demand
a NY Medicaid provide number to maintain your participation
with those PBM networks.
Union Issues
Years ago many pharmacies joined unions for an easy way
of obtaining health insurance and pension coverage for both
the staff and the owner as well as obtaining access to servicing
continued on page 25
NYCPS NEWSLETTER
MARCH 2016 page 25
Issues That May Arise
From page 24
such union member’s prescriptions. 1199 was a popular one,
and there were some other retail based unions. As time went
on the concept of a drug store union became generally dormant
in the New York pharmacy arena. However there are scores
of pharmacies that still maintain a relationship with a retail labor
union. In spite of not having an active collective bargaining
agreement in place, be aware of a federal agency known as the
Pension Benefit Guarantee Corporation (PBGC) The purpose
of the PBGC is to make sure that the pension benefits of
millions of Americans are safe and have sound investments. If
your pharmacy walks away from a union relationship, or gets a
letter authorizing your pharmacy to abandon the relationship, it
does not protect you from accumulated pension liability of your
union staff members. Such liability is known as “Withdrawal
Liability”. You may sell your pharmacy to a new owner, and
you may have ended your union relationship by one way or
another (which does not matter), but you may later learn (could
be years later) that the union pension fund is “under water” and
needs your financial assistance to preserve the rights of your
ISMP
From page 11
Away and Out of Sight educational
program at: www.upandaway.org.
Too many numbers. An electronically-generated hospice prescription for “fentanyl transdermal
72h apply 1 patch 12 mcg/hour
externally q3d” was incorrectly dispensed as fentaNYL transdermal
75 mcg per hour in several increments over 60 days. The error was
eventually discovered when a new
prescription was issued that sim-
former employees for their future pension rights. I have seen
three such incidents over the past few years and the demand
by the unions (you as an owner can be held personally liable
to the PBGC), the demands from the union pension boards
ranged from $900,000 from a pharmacy with over 10 active
employees to a low amount of $209,000 for a staff of three
union employees). You need guidance from a competent
attorney who knows labor issues as well as pharmacy issues.
For more information about this complex subject see: http://
www.pbgc.gov/about/who-we-are.html
I have only touched on three key areas of concern in the
event you are considering retiring or moving on. Of course you
must be vigilant in all areas of your pharmacy operation on an
ongoing basis.
In closing, yes it seems that life as a pharmacy owner is
very difficult in this 21st century. However, being informed of
these “mine fields” up front - -hopefully helps you plan your
operational process and exit strategy in a more intelligent
manner.
Good Luck and Be Alert.
- Jim Schiffer
©2016 James R. Schiffer
ply stated the medication as “fentanyl transdermal patch 12 mcg/
hour.” The error occurred because
the initial drug order unnecessarily
contained “72h” which refers to the
standard release time of 3 days for
all transdermal fentaNYL products.
The number was misread as 75
and mistaken as the mcg per hour
dose. Since a 75 mcg/hour patch
exists, pharmacy personnel did not
refer to the original typed prescription upon refilling it during the first 60
days, which might have led to earlier
recognition of the error. Fortunately
the patient did not exhibit any adverse effects and also reported that
his pain was adequately controlled.
Upon evaluation, a hospice nurse
determined the patient was stable,
and the higher dose was ordered
and continued. The pharmacy’s policy now requires pharmacists to refer to the original prescription when
handling refills. Prescribing system
vendors need to design systems so
that drug names are followed by the
dosage strength when prescriptions
are generated.
Important Notice
You will be receiving a notice from the nys Department of Health regarding the re-validation of your New
York State Medicaid provider number. As a result of the Affordable Care Act, all NYS Medicaid providers must
reapply to continue to service NYS Medicaid patients.
You must complete this process by mid September 2016. You will need to complete a full Medicaid
application including a supervising pharmacist agreement. If you have not revalidated your federal Medicare
Part B supplier number within the past year, you will be required to pay NYS Department of Health a revalidation
fee of $557 along with your application.
You need to check with emedny regarding precisely what forms you will need to submit, along with the
required documentation to supplement the forms. You may call 800 343 9000 for further information.
~Jim Schiffer
page 26 MARCH 2016
NYCPS NEWSLETTER
Beating Margin Pressures
From page 21
being employed that are cost-prohibitive for most community
pharmacies. A proactive approach is essential. Evaluating
regional demographics and hard data from network
administrators to product distributors provides valuable
insights for developing a strategic plan. Build a tactical plan
by assessing the competitive landscape, researching local
marketing opportunities, meeting with local providers, and
developing staff training programs to meet higher service
level expectations.
Independents should rely on affordable resources such
as web-based and traditional print advertising as well as
marketing programs offered by PSAOs, distributors and local
media outlets. Programs may include public health events,
health screenings at community or extended-care facilities,
schools, churches and large employers. Use these tactics
to showcase differentiation in community pharmacy from
mega chains. Focus on personalized services, accessibility,
delivery, direct interaction with a pharmacist, prescriber
relationships, franchise affiliations and any other innovative
services offered.
Planning and Execution
Innovation is developing new approaches to deliver
medicine to your customers that drives adherence.
Implementing programs and processes that are patientcentered, promote adherence, and increase intervention
and communication while driving incremental increases
to your margins. Tactics and technological solutions that
help pharmacists integrate with prescribers, distributors
and healthcare plans increase opportunity to grow
margins and meet business goals.
There are great resources available to independent
pharmacies to drive innovation. Use the Google. All of the
drug distributors have great solutions and are focused
on helping you drive adherence. If you are frustrated and
don’t know where to begin, call me and I’ll help get you
started.
Here is to a healthy and prosperous New Year 2016….
Jimmy Neil
~ © 2016 Jimmy Neil
Jimmy Neil is the General Manager of Pharmacy Lending at Live Oak Bank
based in Wilmington, NC. Reach him at [email protected] or
910.212.4951.
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