Premier Joins Coalition in Advocating for Long-Term Care Pharmacy Payment Reform

Premier has joined healthcare leaders Avera Health, Consonus Health, Geritom Medical, PharMerica, and SPS Health in urging CMS to take action in the upcoming 2027 Medicare Advantage and Prescription Drug proposed rule to preserve patient access to medications dispensed by long-term care pharmacies (LTCPs). LTCPs are the backbone of medication management for millions of America’s most vulnerable patients – those living in nursing homes, assisted living, and other long-term care settings.

Historically, LTCP reimbursement has been tied to the cost of drugs. This is a flawed model that threatens the viability of LTCPs when faced with regulatory efforts to lower the cost of drugs, such as through the Inflation Reduction Act (IRA). Premier is working with LTCP stakeholders to change this reimbursement model by advocating for revisions to the Prescription Drug Plan program. Recommendations include:

Move Away from Drug-Cost-Based Reimbursement: Shift to payment models that reward LTCPs for the services they provide and the health outcomes they help achieve – not just the drugs they dispense. This could include enhanced service fees, capitated payments, or performance-based arrangements.

Strengthen Oversight and Data Reporting: Require prescription drug plans (PDPs) to report detailed data on LTCP beneficiaries and network adequacy. This will help ensure that every patient who needs LTCP services can actually access them, and give CMS the tools to enforce standards.

Stratify Star Ratings by LTCP Beneficiary: Adjust Medicare Part D Star measures to fairly compare care across different environments and highlight the unique impact LTCPs have on patient outcomes.

LTCPs are essential partners in the continuum of care. Without payment reform and stronger oversight, access to critical medications and pharmacy services for millions of seniors is at risk.