CVS stores in the Detroit area recently decided to no longer accept Midwest Health Plan, which administers Medicaid coverage for 55,000 beneficiaries, and M-Care, a University of Michigan managed care plan that covers 180,000 individuals, and Walgreen stores also decided to longer accept Midwest, the Detroit News reports. According to the News, the decisions involve about 280 pharmacies in the Detroit area -- about 15% of the retail market -- and the "issue in both cases is the amount the insurers were willing to pay the stores." In one case, Midwest declined to meet a request from Walgreen for a minimum reimbursement of $8.99 for each prescription filled. In a second case, CVS declined to accept the reimbursement rates established by a new pharmacy benefit manager at M-Care. Similar disputes between pharmacies and health insurers have occurred in other states, although "several market experts couldn't recall a situation in which two cutoffs happened at the same time in the same state," and experts predict "the situation in Metro Detroit is likely a sign of things to come, especially as insurers look for ways to trim soaring pharmaceutical costs," the News reports. Frank Ascione, dean of the University of Michigan College of Pharmacy, said, "You're going to have these folks battling it out more and more as we get more chains, and they get more and more power. It could be very detrimental." Michelle McKenna, spokesperson for the National Association of Chain Drug Stores, added, "Stores aren't required by law to take every insurance plan out there. It all comes down to a business decision" (Terlep, Detroit News, 7/31).
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