Walgreens draws a line in the sand

Unfavorable contract terms

Walgreens said that it had reluctantly reached this conclusion because:

Officials from ESI say Walgreens is demanding as much as 20% higher reimbursements than what other pharmacies in the network agreed to accept. Walgreens' executives have denied that figure. The dispute has affected about 10% of Walgreens' more than 60 million pharmacy customers.

In 1962, when I opened my pharmacy in Sausalito, Calif., there were 59 independent pharmacies that took care of Marin County, Calif., patients. Now there are 4 independent pharmacies left, partially due to the 3 managed care companies like ESI, who have squeezed the small businesses out of existence.

"While we remain open to any fair and competitive offer from Express Scripts, we firmly believe that accepting their proposal was not in the best interests of our shareholders," said Walgreens' CEO Gregory D. Wasson, RPh, in a statement. The company said its negotiations with health plans and employers had resulted in retaining just 11.4%, or about 10 million, of the 90 million prescriptions managed by ESI that were filled by Walgreens in the last fiscal year.

Moving forward, Walgreens noted that Medicare Part D patients who use its pharmacies will continue to have the option during the open enrollment period near the end of the year to choose a Part D plan that includes Walgreens. In addition, some ESI clients may have the ability to include Walgreens as part of their benefit offering. As a result, Walgreens said it will look for opportunities to have discussions with ESI clients.

A case for front-line pharmacists

"Our community pharmacists are on the front line of helping to lower overall healthcare costs through medication adherence programs, generic conversion programs, immunization and vaccination services, and face-to-face counseling on a daily basis," said Kermit Crawford, Walgreens' president of pharmacy, health, and wellness.

As president of PPSI, a consumer advocacy group, I believe it is imperative that pharmacists do what they are trained to do: safeguard public health by counseling, reviewing patient histories, offering MTM services, and providing chronic disease medication management, in such areas as diabetes, asthma, and cardiovascular disease.

Walgreens' CEO deserves the highest accolade and award – the Remington Honor Medal – for drawing a line in the sand and emphasizing the need for reimbursement for pharmacy cognitive services.

Frederick S. Mayer, RPh, MPH has been a practicing pharmacist for over 50 years and is president of Pharmacists Planning Service, Inc. (PPSI), a nonprofit public health, consumer, pharmacy education organization. To send comments or questions, please contact Mr. Mayer at ppsi@aol.com
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