Independent pharmacists push for KanCare contract enforcement

Ron Booth is a pharmacist and proprietor of the Corner Pharmacy in Leavenworth, which was established in 1871. He said the state's three KanCare managed care companies often pay less than his costs of buying drugs and that he has been forced to turn away hundreds of customers. "They are changing all the rules and no one in Topeka is holding them accountable. I'm speaking out of frustration as a small, locally owned pharmacy. I want to be treated fairly,” he said.

Ron Booth is a pharmacist and proprietor of the Corner Pharmacy in Leavenworth, which was established in 1871. He said the state's three KanCare managed care companies often pay less than his costs of buying drugs and that he has been forced to turn away hundreds of customers. "They are changing all the rules and no one in Topeka is holding them accountable. I'm speaking out of frustration as a small, locally owned pharmacy. I want to be treated fairly,” he said. by Phil Cauthon

Gov. Sam Brownback’s Medicaid makeover has been putting a financial squeeze on small Kansas pharmacists and spokespersons for the hometown druggists are calling for the administration to enforce the terms of its contracts with the three KanCare managed care companies.

“I think the simple answer is for the State of Kansas to make sure the MCOs (KanCare managed care companies) are living by their signed contracts and that should have been ready to go Jan. 1 (when KanCare was launched),” said Mike Larkin, executive director of the Kansas Pharmacists Association.

“We understand there will be bumps and hiccups in the implementation of a new program, but I can't help but think that if the shoe was on the other foot and they (the MCOs) were losing money instead of making money, they would have been on this (problem) a lot quicker,” he said.

Pharmacists say the heart of the issue is that the KanCare companies — Amerigroup, UnitedHealthcare and Sunflower State Health Plan — often fail to reimburse the druggists for the costs they incur serving Medicaid enrollees.

“I guess the bottom line is that we were led to believe in the first year (of KanCare) that there would be no changes on reimbursement or anything,” said Ron Booth, owner of the Corner Pharmacy in Leavenworth. “But you see, these (KanCare MCOs) are for-profit companies. They are changing all the rules and no one in Topeka is holding them accountable. I'm speaking out of frustration as a small, locally owned pharmacy. I want to be treated fairly.”

The pharmacists, before and after KanCare, work from rate sheets that list the maximum they will be reimbursed by Medicaid for each of the long list of medications they dispense.

What changed

But here is what changed with KanCare, according to pharmacists and others familiar with the business: In the past, the state kept a single list or rate sheet of “maximum allowable costs” and when its reimbursement rates failed to cover a druggists’ costs, it was more or less routine for the pharmacist to appeal and have the rate revised upward. The druggists could then resubmit those claims to the state and be paid enough that they weren’t losing money on the transactions.

With KanCare, each of the state’s contractors — or rather their pharmacy subcontractors — keeps a separate rate sheet, the formulation of which is considered proprietary. Booth and others said getting prices adjusted by the MCOs, so that the pharmacists aren’t losing money on many of their Medicaid claims, has largely been an exercise in futility. And they also are frustrated that they can’t get access to the methods the MCOs use for calculating their reimbursement rates, something obliged of them in their contracts with the state.

Customers turned away

Booth’s pharmacy, which was established in 1871, still has a soda fountain and other small-town amenities of a largely bygone era. It is a hub of activity in the middle of Leavenworth’s historic downtown district and Booth is a proprietor clinging to and clearly relishing his role in the vanishing tradition of local merchant as “pillar of the community,” in daily contact with his customers and their concerns.

Booth said since KanCare started he has served hundreds of his customers at a loss and turned away more than that because he could no longer afford to fill their prescriptions. And he said he has not had a single appeal approved or adjusted upward by any of the KanCare companies since the program started six months ago. He gets form-letter denials, he said, and little or no understanding from the KanCare customer service reps when he calls to complain or ask for assistance.

“My problem is I'm dealing with real people in front of me at the counter,” he said. “They are my friends and neighbors. I actually care about them.”

Reviewing the appeals data

State officials said they were aware of the pharmacists’ concerns with reimbursements (outlined in a May letter from Larkin to KDHE) and were looking into them.

“KDHE has heard provider concerns that fewer MAC (maximum allowable cost) appeals are being approved in KanCare than in fee-for-service Medicaid,” said Kari Bruffett, director of KDHE’s Division of Health Care Finance. “KDHE is in the process of reviewing both KanCare MAC appeals data in aggregate and a sample of denied appeals to ensure compliance with our expectations.”

Meanwhile, Bruffett said, the state’s overall pharmacy spending was up from last year.

“Through the first five full months, overall pharmacy reimbursement is running about 8 percent ahead of the same time period in 2012,” she said in an email to KHI News Service.

“Someone probably is benefiting,” from KanCare, Booth said, but it hasn’t been him.

In fact, you probably shouldn’t get him talking about it unless you have some time to listen.

“At first, we were just absorbing the cost. But I decided I'm not going to do it anymore,” he said. “I'm going to be the squeaky wheel. Someone's got to stand up. I don’t want to subsidize these big MCOs that make millions each year. I work about 70 hours a week. I’m fighting for my life everyday. The big boys don’t need me. They don’t need Ron Booth who gets up in the middle of the night for his patients, sees them at Rotary, sees them at church, goes to the ballgames. I’m part of this community and unfortunately I have a conscience.”

Continue reading this story — and related KanCare stories — on khi.org.

Tagged: Plan, medicaid, Health, brownback, Sunflower, United, pharmacy, kancare, Healthcare, Amerigroup, ombudsman, independent, kansas

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