So, easy
questions to start.
Just tell me a little bit about
yourself as a pharmacist
and the owner of this
business.
Yeah, thanks for letting me be here
today. I'm Nicole Schreiner.
I am a pharmacist for
over 25 years and
I am the current owner and
CEO of Strews Pharmacy
in Green Bay, Wisconsin.
And how long has
shrews been around?
Strews has been serving their
community for over 70 years and
it's been kind of passed down
through different families and
generations and now
embarking on a new generation with
me and another business partner as
we move into this part of
the you know the 2025.
So tell me a little bit
about what you personally
like the most about being
an independent pharmacist.
The part that I really enjoy is
really making a difference
in patients' healthcare decisions
and helping them navigate some
of those decisions, helping them be
compliant with medications and
just being a part of a total
healthcare team.
I've described to some of my staff
and colleagues that
medicine has become very
specialized. Patients might have
a neurologist,
a cardiologist, a behavioral
health physician.
And a primary care provider, and I
feel like sometimes I talk about
them being tiles on the wall.
And I feel pharmacy is that
grout that holds it all together and
keeps it all from falling off the
wall, and because we're the ones who
are kind of doing a lot of that
communication back and forth between
the providers and the patients
because we see them on a regular
basis.
Um.
So, very broadly,
what are some of the biggest issues
facing local
independent pharmacies?
Yeah, the broad answer to that is
the reimbursement that we're getting
from PBNs or pharmacy benefit
managers has made it a very
challenging environment to be able
to properly
staff and be
a viable business in the community.
And tell me a little bit more about
reimbursements.
Sure, so I've got to give you
just a little bit more history from
my perspective at least on
pharmacy benefit managers, or PBMs,
in that they existed, they did
exactly what they were called to do,
or what their name means,
is they managed the pharmacy
or the medication portion of a
patient's health plan.
And they were looking to
control costs by
deciding on formulary and
negotiating prices with drug
companies.
That made them.
It was very competitive when they
first came out.
In the 60s and 70s, there was,
at their peak, I think they were
well over 50 different PBMs that
existed.
Now, currently, there are
three PBM that control 89%
of the lives in the
United States.
So it's become very
powerful, and
independent pharmacies like myself
have no negotiating power
anymore with these
PBM's.
And so the contracts
have become basically take it or
leave it.
They've continued to
erode year after year after
a year.
And it's estimated that
independent pharmacies, depending on
your particular location in the
country, can have anywhere from 20%
to 40% of their claims are actually
reimbursed below cost.
And so what is
the end product of that
then?
Meaning.
What are the consequences?
Oh yeah, the consequences
are, well one,
NCPA estimates that
one independent pharmacy closes
every single day.
So one, just the
feasibility of having an independent
pharmacy is becoming very
challenging.
Pharmacies that are doing,
are hanging in there or trying to
weather the storm,
are having to cut staffing
and resources.
Less able to do some of the
wonderful services that we do, such
as device training,
coaching on chronic disease state
management, whether that be
diabetes, high blood
pressure, other types of
interventions.
We offer things like delivery
service and
medication packaging to help people
be more compliant with their
medications.
It's endangering those services
that pharmacies provide
oftentimes at no charge to patients.
Are independent pharmacies
very different from
chain pharmacies.
I believe so, which is why I chose
to become an independent pharmacist.
I believe that we are able
to offer a personalized
service.
We pride ourselves.
I oftentimes don't even like to use
the word retail because I don't want
to be associated with the product or
just the dispensing of the
medication.
I want to a member of the patient's
healthcare team and I want it
to be an essential part of that
healthcare team in helping patients
understand their medications and
being compliant with their
medications.
So I believe, because we are
independent and answer
mostly to ourselves, we have
the ability to be nimble and change
more quickly and adapt
to the needs of the patients on a
regular basis.
Um so talking
a little bit more specifically
about some of what
is in this piece of
legislation um
it covers a lot
of different things um
there are some things that are very
specific to pharmacies yes
so one of them is reimbursements
what would it do
So a couple things with the
reimbursement. One is it would
address that there would be
a minimum requirement for
a dispensing fee.
So right now, dispensing fees can be
$0.50 under $1.
And that's supposed to cover your
label, your bottle, your labor,
all of the other things for your
fixed cost. And we all know that
$0,50 to $1 doesn't go anywhere
near. Especially when we're not even
getting the ingredient costs to
cover the cost of the medication
itself. So it would have a minimum
dispensing fee associated with that.
In addition,
that bill also
would allow
patients to
allow the manufacturers that
have copay cards that
would allow patience to
utilize those and allow those to go
towards their deductible.
The bill also in terms of
reimbursement would allow me to deny
service or to say
to patients that this particular
product is not,
is reimbursing under my cost of
my, my purchase price of the
medication.
Right now I have to treat a patient
as a whole, meaning that if
I, I have that
patient's entire medication profile
at my pharmacy and I'm losing money,
I can't just say I'm not going to
dispense this medication.
So I have a couple examples.
One is a class of medications
that is being commonly used to treat
diabetes called GLP-1s.
Those, some pharmacies are just
choosing not to carry them because
they get reimbursed below their cost
and they can't say that I'm not
gonna dispense just that one
medication.
So they just don't carry them
because they can afford to.
And I had an example this last
year with patients that
I had one patient, I added
up all of her medications.
She had 10 or 11 medications, and
I ended up owing the PBM over
$50 at the end of each
month because I
was taking losses when you totaled
up all of her prescription
reimbursement, my margins on all of
meds.
So it's just not a
feasible model for
independent pharmacy to continue to
operate.
Does that leave the patient in a
difficult position if
their medications are so expensive
that pharmacies might not want
to dispense to them?
Absolutely, it's creating an access
issue for patients.
Whether the pharmacies choose not
to carry them because of the losses
that they're taking, where's that
patient gonna go?
The pharmacies going out of
business is creating shortages
for patients in particular areas.
We oftentimes talk about in rural
areas,
patients having to travel perhaps
20 miles to find a pharmacy
that would be able to provide their
medications.
And, but we're having that
even in urban city
areas where patients who don't have
access to transportation other than
public transportation having
difficulties finding a pharmacy
that's gonna be able to serve them,
take their insurance.
Some pharmacies are choosing not to
carry particular
plans because of the poor
reimbursement.
For instance, our pharmacy did
an analysis of
our major payers.
And we decided not to sign contracts
with two of the major PBMs
in our area and that was just
because of the poor margin that we
were taking and we
tried to renegotiate those contracts
and we basically got
a reply that was this is
what we have to offer and at this
time we are not
adjusting any of our our
contracts so it's
it's take it or leave it you get
what you get and that
unfortunately, is, is...
We have no power to negotiate
anything better.
We spoke
a little bit about Kolschmitnik
and how there
was a
service that he
didn't get that his father got
from a local
pharmacy.
Can you describe what
you think is the
benefit of this legislation?
And not speaking to coal
specifically, but in general,
that it would provide.
So, in general, I believe
every pharmacist wants to do what's
right by their patient.
And unfortunately, sometimes metrics
and being able to stay
afloat makes
you make choices that you wouldn't
otherwise make in a place of
freedom.
And so, this bill
would, first of all, allow us to
have proper reimbursement
that would hopefully
allow them to have an
adequate amount of labor.
That when you get these confusing
rejections or even
a paid claim when we
run them through the computer
system,
but higher co-pays,
sometimes those require a degree of
research.
Is the patient deductible?
Is this no longer the preferred
product?
What is the preferred project?
Do we need to get a therapeutic
interchange or an alternative
product for that patient?
That is all very time consuming.
And not reimbursed.
And so if you're not even making a
reasonable margin on your
product that you are able to
dispense, it certainly doesn't
allow for time to be able to
do these above and beyond the
routine.
With these systems
being so complicated,
how likely is it that we
can be proper consumers
if we're not experts in
all this stuff?
Yeah, that's a good question.
I think what we're trying to make
people aware,
actually at just one of my recent
meetings, someone asked
the question at a pharmacy meeting,
what tells you that something is
changing in the world of community
pharmacy?
And I said that more people
actually even know what
a PBM is.
So I think we're tying to educate.
I think patients oftentimes think
that because the medication
is costly.
That the pharmacy is
the one that is pocketing
that money.
And it's just, it's not the case as
we gave the statistics of every,
all these pharmacies closing across
the nation, other pharmacies
filing bankruptcy.
We know that it's,
it not in the
pharmacy's model that is making
all of the money.
And yet we see PBMs
becoming.
In the top Fortune 50
companies in the United States.
And they're doing it because they
have the power to be able to do this
now because of the amount of
lives that they control with
the top three PBMs.
Um, I
don't think we covered it here yet,
um, can you
share again the chain pharmacies
that...
Yeah, I don't have the exact
numbers, but it's public
information.
Walgreens made an announcement.
I believe they're closing over 2,000
stores nationwide,
which I believe they
had just over 8,000, so
coming close to a quarter of their
stores nationwide are closing.
Rite Aid, I believe it was earlier
this week, just filed bankruptcy.
So it's very difficult if
these change that have thousands
of stores can't make
it go.
Because they lack the power to
negotiate with these PBMs.
It's very concerning how someone
like me, who owns one location,
is going to have any negotiating
power.
Why can't
manufacturers who,
to some degree, are probably also
frustrated with PBMs
and pharmacies circumvent
PBM?
Oh, that's a convoluted
story.
So we haven't even talked about
wholesalers and buying groups,
which are also part of that.
Very few products are purchased
directly between a pharmacy and
a pharmaceutical manufacturer.
They have to go through this
whole chain of which
I believe there is a lot of waste
in there. We have
wholesalars who are also on
the Fortune 500 company, on the
fortune 500 list.
And then you have a buying group,
which everybody has to take their
little piece of the pie,
as well as the pharmacy benefit
managers.
So sometimes if we could be
able to purchase these drugs more
directly from manufacturers
or get rebates from
them, I'm
not going to say that manufacturers
are innocent in this whole thing
either. Some of their products
are quite costly.
But also the United States is, in
their defense, one of the highest
innovators in research and
development in the world.
And so that's part of you have to
pay for a lot of medications that
don't make it to market.
And a lot that goes to that.
And I believe, as we did briefly
mention with the copay
cards from manufacturers,
they tried, in
my opinion, to make
baby steps towards trying to help
patients be able to afford their
medications with these patient
assistance cards.
And then PBMs took it
as a way to say, well then it can't
apply towards your deductible.
And so it took that baby
step away from the manufacturer
even trying to help the patient
to make that happen.
Can you briefly
describe how
vertical integration is something
that also ends up
harming local source.
Yeah, so that's been a challenge to
vertical integration, meaning
that sometimes
health plans own their
own PBM.
Sometimes PBMs own their
pharmacy.
And so they restrict
or require patients if
they're on that particular health
plan to utilize their pharmacies
or utilize their PBM
So just for example,
like CVS Caremark is a is a
PBM.
And they prefer patients
to use their pharmacies or CVS.
So that becomes very challenging
because either patients are
restricted and not able to
use an independent pharmacy
or if their plan allows
them to use independent pharmacy,
they may be paying higher call pays.
So that's just one example of
vertical integration.
Optum and United Health is another
example of a vertical integration
So it just becomes more challenging
because the power then becomes even
bigger and again
doesn't allow us to have that
negotiating power and the ability to
What does Felskowski's
bill address then?
It does not, as far as I know,
it does not address any vertical
integration, however,
Arkansas just passed PBM reform
in their state, I believe
at the beginning of the month, that
does not allow any
PBM to operate a pharmacy
within their state if
they have financial.
Okay, so I thought maybe
the networks piece of
the bill addressed that, but that's-
It wouldn't
make it inappropriate
to have or illegal to have vertical
integration, but it would allow
access.
So I apologize for not
understanding the question appropriately.
Yes, the bill does allow patients
to have freedom of choice, so they
would not be required to use either
a mail order or a
chain pharmacy or any one particular
pharmacy.
It would be any willing provider
would have the ability to be
able to provide care for that
patient.
Um...
Anything about...
Other fees like
claim processing, performance-based,
network participation,
accreditation,
are those things
that are also any particular
pain for pharmacies or
is it death by a thousand
cuts?
Exactly, it is because
there we do pay a switch
fee meaning so because we send the
claim through electronically through
the computer every time you
process the prescription the
PBM and the switch all
take a fee out of those.
They're small but when you're
talking about processing potentially
30,000 claims in a year or
in a month that adds up very
quickly and so
you're losing another portion
of that reimbursement for those
fees that are paid.
In addition, there
used to be what was called DIR fees
that were
meant to help pharmacies be higher
performing pharmacies, making
sure patients were compliant, they
had certain disease states, that
they were on certain medications and
that they taking them appropriately.
And what
would be these fees would
then be assessed
to us.
Retrospectively, meaning that I
might not get that fee taken back.
So I would get paid a certain amount
today, and then that fee would be
taken back two to three
months later in what was called
a DIR fee.
Well, we were able to get not
that DIR fees went away,
but the fees went to being assessed
at the time of the claim.
However, with even certain
PBMs, they
take a chunk.
Whether that be 10%, 11%,
8%, they take a
percentage of that claim, and even
if you are a great performing
pharmacy, your chance of earning
something back is 1%.
So those are other fees that, again,
get assessed.
Some people call them pay to play.
It's basically you have your
contract, and then you also have
these additional fees that go above
and beyond on those contracts.
Yes.