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Elizabeth M. Whitehorn, Director

Provider Notice issued 02/21/12

Pharmacy Reimbursement Rates Effective February 1, 2012

To:​ ​Participating Pharmacies
​Date: ​February 21, 2012
​Re:  Pharmacy Reimbursement Rates Effective February 1, 2012​

Rulemaking regarding the department's reimbursement rates for pharmacies have been adopted and become effective February 1, 2012.

Effective February 1, 2012, pharmacies will be reimbursed at the lesser of:

  1. The pharmacy's usual and customary charge; or

  2. The department's maximum price plus the established dispensing fee of $6.35 for generic drugs and $3.40 for brand name drugs.

The department's maximum price is calculated at the lowest of:

  • Suggested Wholesale Price minus 25% for generic drugs

  • Wholesale Acquisition Cost plus 1% for brand name drugs

  • Federal Upper Limit (FUL)

  • State Upper Limit

The new generic dispensing fee of $6.35 represents a $1.75 increase over the previous generic dispensing fee of $4.60. The purpose of this incremental increase is to increase the generic dispensing rate. Pharmacies are expected to make additional efforts to effect a switch from brand name drugs to generic alternative (not equivalent) drugs in cases where that switch is clinically appropriate. The department believes this $1.75 increase will adequately reimburse pharmacies for the resources invested in contacting prescribers to effect that switch. If the generic dispensing rate does not increase by 2.00% over the next two years, the generic dispensing fee will revert to $4.60 effective January 1, 2015.

Any questions regarding this notice should be directed to the Bureau of Pharmacy Services at 1-877-782-5565, option 7.

Theresa A. Eagleson, Administrator

Division of Medical Programs