Local News

Independent druggists to lose under State Health Plan proposal

Posted March 11, 2009
Updated March 12, 2009

— One cost-saving measure being considered for the State Health Plan would require some employees to get prescriptions for chronic conditions such as diabetes and high blood pressure through an in-network pharmacist or by mail order, possibly boxing out independent druggists.

That's in legislation filed in the state Senate.

Some pharmacies could be shut out of new health plan Some pharmacies could be shut out of new health plan

Independent pharmacies in small towns will lose business due to the mail-order provision and can't make a profit on the in-network reimbursement rates, said Mike James, a lobbyist for the Association of Community Pharmacists.

Retired state worker Barbara Currie is among those whom Senate Bill 287 would affect.

"I take a prescription for osteoporosis,” Currie said. For drug refills, she shops around for the best bargain at area pharmacies.

"I end up paying $30, instead of $50,” Currie said, but her own bargain-hunting would be replaced my mandatory savings under the bill. 

"If they choose to go to a pharmacy that is not part of that program, then they will, in fact, have to pay 50 percent of the cost of medication, in addition to their co-pay," James said.

Currie would have to use an in-network pharmacist or mail-order company to get full health plan benefits.

"It actually gives an additional benefit to the state employee because the state employee will only pay 2.5 co-pays for [a] 90-day supply,” said Sen. Tony Rand, D-Cumberland, sponsor of the bill.

Rand agreed that the bill would be hard on small pharmacies.

"It will reduce their profit margin, there is no question,” Rand said.

He said tough measures must be made to bridge the state budget gap, however. The State Health Plan is running out of money at the end of this month, and the bill could save the state $90 million, Rand said.

"This is a terrible situation in which we find ourselves,” Rand said.

A $250 million cash injection is under consideration for the health insurance program. The money is attached to Senate Bill 287 and includes premium increases for families, financial incentives to stop smoking and lose weight and the new prescription drug program.

James argues that money that would have gone to North Carolina pharmacies will now go to other states where the mail-order drug companies are located.

"We believe there is a lot of money that is about to leave the state,” James said. "I have never believed that mail-order is good medicine."

There are 54,000 pharmacy-related jobs in the state, James said. He estimated the bill would cause the loss of at least 10 percent of those jobs.

The Senate is to take up the bill next week.


This story is closed for comments.

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  • DrJ Mar 13, 2009

    Price shopping for prescriptions is false economy. Stick with the same pharmacy, and they will be able to help you avoid all kinds of potential health problems, some maybe even deadly, by making sure drugs you're already taking don't interact with new ones. If you buy prescriptions all over the place, no one will be able to provide any oversight.

    I don't know what the answer is for "affordable health care," but I do know the ambulance chasing lawyers love laws like this that create potentially dangerous situations for patients.

  • kbjones0516 Mar 13, 2009

    This is a horrible Bill for pharmacists in North Carolina. It is INSANE to send this much money out of our state to other states! Please contact your representative before the vote on Monday to let them know this information:

    What it could mean for pharmacists in NC:

    o Loss of State employees’ maintenance medications to a mail order pharmacy unless you become part of a “preferred in-network” program
    o Loss of figures between $480 and $680 million sent to Medco distributors in New Jersey, Ohio and Las Vegas.
    o Loss of 5400 pharmacy jobs in North Carolina

  • piller Mar 12, 2009

    Walmart and Target won't be accepting these rates either. It's not just the independents as this story might imply. Due to less overhead and group buying most independents are now healthier and more competitive than chains. As posted below this is a smoke and mirrors ploy. If the formula is left as is then mail-order will be forced on State Employees and the taxpayers (due to a flawed formula) will be paying MORE for this service than they are now. The end result: less jobs for NC, more costs for the taxpayers and decreased service for the State employees. It's time to email and call those Senators and House members and ask them to check all the facts before they waste your money.

  • foetine Mar 12, 2009

    submit yourself to the faceless Walmart machine. Why don't these chronic cases just hurry up and die. they're taking downtown parking spaces from healthy people.

  • aspenstreet1717 Mar 12, 2009

    How about Walmart and Target they're not out of state and they have competitive drug prices.

  • piller Mar 12, 2009

    The problem is not that independents are not competing. Mail order firms are buying the expensive drugs, repackaging them in small sizes, assigning new National Drug Code numbers with wholesale prices inflated by 150% to 200% then discounting that price by 12% and billing the insurance who have somehow been fooled into paying. So do you want a $100 drug discounted 15% by your local pharmacy or do want it marked up to $200 and discounted 27%. If you are drinking that Kool-Aid you are also probably upset that your monthly gas card rebate is less because gas prices have decreased. And yes, I do have documented proof that (as of this afternoon) has been shared with the NC Senate. We will see what happens now. Please, don't assume your local pharmacist is not the most cost effective without checking all the facts.

  • gtstallings45 Mar 12, 2009

    Governor Perdue would surely veto this legislation since it would effectively take the "seed corn" away from NC citizens and leave them without jobs. By the way, are these mail order companies based in NC?

  • 1Moms_View Mar 12, 2009

    This is the second set of idiotic comments by Mr. Rand that I've read this week alone. He really needs to spend some time among his constituents instead of hiding out in Raleigh trying to act like some bigshot legislator. He has no clue. He wants to send business out of state, which will send NC monies out of state, while creating even more economic problems for our local businesses.

    I do buy my medications on the rare occassion I have a prescription from a small independent local pharmacy. My main reason is better customer service. The pharmacist knows me and in the past has picked up on things like potential allergic reactions that a larger pharmacy would let slip by.

  • DontLikeTheSocialistObama Mar 12, 2009

    Independent drug stores are going the way of the dinosaur. If you can't compete you won't survive.

  • nobio Mar 12, 2009

    Whenever Mr. Rand and supporters need a quick prior authorization, 6 -7 tablets to last until his mail order drugs arrive, an additional refill, or has a emergency midnight prescription... he can surely go to his hometown independent pharmacy where they will still welcome and help him. It may not be as warmly as before, but our professional ethics will take over and his pharmaceutical needs will be met. He know this and still wants to give NJ's Medco the business. Also, Mr. Rand must remember that pharmacists in small town throughout NC are usually pillars of the community and have a lot of political influence.
    Bill McKellar
    Independent pharmacist with 39 yrs experience