Changing the Pharmacy Payment Model | Doug Hoey, CEO at National Community Pharmacists Association

Speech to text:

Mike Koelzer, Host: [00:00:00] Doug for those who haven't come across you online, introduce yourself and tell our listeners what we're talking 

Doug Hoey, CEO, NCPA: about today. 

Sure. I'm Doug Hoey. I'm the CEO for the National Community Pharmacists Association. We represent the independently owned pharmacies in the United States. And today we're going to be talking about changing the pharmacy payment model.

Mike Koelzer, Host: When I think about pharmacy right now, I know it's very cliche to say these are exciting times. But I've been on a long time, but this does seem like some exciting times right now to change the payment model. And it might just be that subjectively because I'm talking to more great leaders like yourself and I'm hearing more about it, but I think there's some objective things like the Rutledge case and you know, different things that are happening politically.

So much movement with the NCPA and APH. It might just be biased because I'm looking for it more. Are there really changes happening now more than ever, maybe. 

Doug Hoey, CEO, NCPA: Yeah, no, you're not biased. Mike, there are more changes than ever before. I'd almost liken it to, you know, a rollercoaster, you know, a rollercoaster is thrilling.

It's exciting. It can also be terrifying. And I see that, uh, you know, a lot of those emotions where there's a lot of change, it's, it's an exciting time. But whenever there's a lot of excitement, you know, it, it can be, it can be scary too, but you mentioned the Supreme court case. Uh, that's certainly been an emphasis for change COVID.

I mean, frankly, the pandemic has really opened up despite the tragedy that is the pandemic. It's opened up a lot of avenues for pharmacy to really shine. As we know it does, but now I think the rest of the world is starting to see how important pharmacists are to our healthcare system. 

Mike Koelzer, Host: From like 2015 through 19, our business was going personally, my business was going way down because of all the DIR fees.

I was spending a lot more time at home. I was kind of depressed because there was so much. Cost and my business till I wasn't firing my pharmacist because we were still busy as hell, but the DIR fees were coming on when COVID hit. It was, I hate to say it because of the people that died and all the problems it caused, but it really almost turned my life around because a lot of my staff took off, not necessarily for COVID, but they knew we were probably going down in size and not just the PPP money that came in and the Eid L loans.

It put me back in the community. And I was one of the only people out there, you know, it was like me and the firemen and maybe the grocery baggers or something like that. But it gave me a little bit of new life in my old age here in the pharmacy. And I'm not even doing vaccinations and stuff, but you add that to all the things that community pharmacists are doing.

And I know I'm really making a difference. 

Doug Hoey, CEO, NCPA: We've had silver, our members tell us that, especially in the early days of giving vaccinations. You know that the first wave was seniors. Um, and that they had tears in their eyes and they were talking about not only the patient who had tears in his or her eyes, but also the pharmacist, because they were really reopening this person to allow them to live.

And that person was so grateful. And it's such a, you know, it's such a different experience for our members. Dispensing, you know, lisinopril 20 milligrams. Um, uh, because it's something that, uh, that, that patient was just so thankful for. Um, so it's been, I know you mentioned the essential business aspect that, you know, are when I talk to our members, which I talked to them every day, all the time, but they're both.

Kind of like that roller coaster analogy, exhilarated and exhausted, they're tired, but they feel like it's that kind of feeling of exhaustion you get after a really good workout or a really hard, hard day's work. There's a feeling of satisfaction that you've made a difference versus you're just, you're just beat and you feel like you've been beat up . It's a feeling.

I've accomplished something. I've made a difference, which is why I got into this business in the first place. Why went to pharmacy school in the first place, 

Mike Koelzer, Host: When you mentioned the rollercoaster and you mentioned scary times, what's some of that scariness that comes with success? 

Doug Hoey, CEO, NCPA: One of the things that comes as you're a bigger target.

And so, and that's, you know, independent pharmacies have a history of being laboratories of innovation. So we're [00:05:00] pioneering plowing new ground. And once we develop success or other, see success, then all of a sudden, you know, big corporations want to come in and try to try to take it from us. And, and that happens all the time.

So you become a bigger target when you're, when you're more successful. Um, when you take on more responsibility. So the ability to order and administer vaccinations. That's a big responsibility. It's a welcome responsibility, but it's a big one. And so taking advantage of that, you know, with that, you may have some liabilities that you didn't have before, but if you, if you want the more responsibility, the greater opportunity, there's, there's going to be some, some risk that's associated with it.

But you know, our. Entrepreneurial members they're embracing that. And you know, the vaccinations have been just an enormous opportunity for them and they've taken advantage of it. 

Mike Koelzer, Host: Is there anything left of PBMs to come after us? Once we start doing things like the truth campaign that NCPA is doing, or these lawsuits, what other targets are we Doug?

When it comes to our, are we more of a target when it comes to. Shining a light on these things. Are they getting nasty nastier than they can get? 

Doug Hoey, CEO, NCPA: Yeah. Yeah. I don't think there's a limit on how nasty they can be. You know, our members would come to us and say, No , they're trying to put me out of business.

They're trying to put me out of business. And I thought, you know, I'm not sure that they are because they're smarter than that. Because if they put the independents out of business, they're going to have to deal with one or two or three chains. And that's it. That's interesting from a leverage standpoint, that's bad.

For them, fragmentation is good for them, which is what I had thought for many years. I don't think that any more. I think that, yeah, they are trying to put independent pharmacies out of business. They'll say that. They'll say they'll deny that, um, they've denied it to my face many times. But I don't believe them, I don't believe him. I think that part of their strategy is to basically conquer the world. Um, I think they've shifted what's important to them and you know, I don't think they care as much about the cheap generics anymore. I'd still, you know, I think that's still a battle place, but I think the bigger battlefields are specialty drugs.

Uh, I think that's a huge battlefield and that's exactly where the PBMs not only are going, that's where they've gone. And I think the other place that they will want to control is on the services that we provide the patient care services that increasingly pharmacists are getting paid for. They will want to dip their hand into controlling.

Where and how and who, and how much pharmacists get paid for the patient care services that we provide. So I, I think we have to really be, I've heard people say, oh, the PBMs are always a step ahead of pharmacy. Well, I think to stay a step ahead of them, we have to think about controlling our own destiny because pharmacists control our own destiny when it comes to patient care services and then trying to regain some of them.

The turf that has been stolen from us on the specialty drug side. 

Mike Koelzer, Host: I know that NCPA and I've talked to a couple of the members with the community pharmacy enhancement services. Network C P E S N. There's some really cool things happening there for anybody that hasn't come across. In a nutshell, some of those extra services and getting paid for those and so on.

But the PBM are they tearing that door down as we 

Doug Hoey, CEO, NCPA: speak? Yeah. I don't know if they're tearing the door down yet, because I don't know if there's enough for them to tear down, but I'm sure it's in there. Their site. And so, you know, especially with the integration, the vertical integration we've seen of PBMs, which is, if you think about it, there's not a large standalone PBM anymore.

They've all adjusted. I mean, they've seen the writing on the wall. They've seen, they've adjusted somewhat to, you know, the pressure that we as NCPA have been putting on them for decades, shining lights on them, which has resulted in legislative regulatory pressure. And, you know, they've already adjusted.

Um, by either purchasing and CVS has a case or being purchased by an express scripts and opt-ins case integrated health insurance. [00:10:00] So that's one way where they can steer patients either to pharmacists away from pharmacists, providing not only the dispensing, the products, but also the patient care services that we provide.

Now, again, the vaccinations are a huge opportunity because. It's difficult to not include pharmacies when you need to vaccinate 300 million people. And also in the court of public opinion, which is something that they are sensitive to in the court of legislative opinion. If they try to exclude 20,000 independent pharmacies, that is a PR problem for them, it doesn't mean they won't try to do it when this, the spotlight isn't as bright.

But, um, we, we have opportunities. On the patient care services side now, we have to be careful that we don't let you know seed control to the PBMs because they want control of everything. 

Mike Koelzer, Host: Do you think the PBMs will try to grab that market from there? Vertically integrated pharmacies, or do you think they may even come up with some other, you know, service?

Like I know that MTM, for example, the chains will do this phone call thing and try to infiltrate in, grab your customers away. Do you see them trying to get their hands on that through their pharmacies or some other newer service or entity or something? 

Doug Hoey, CEO, NCPA: Yeah, I think they'll try to use the health insurance plan to try to steer patients into whether it's an affiliated pharmacy.

Uh, like a CVS and CVS, or whether it's, um, just to a pharmacy that they have agreements with or not a pharmacy at all, they want to steer it into, you know, some other provider there's really no limit to how far they'll go. You know, one of the things about NCPA side, I was saying this the other day was, uh, presenting to a group and just, you know, a quick history of NCPA we were for.

A hundred and eighteen ninety eight, a hundred twenty three years ago by a group of pharmacists in the Midwest and St. Louis area who were upset because there was a tax being placed on prescription vials to fund the Spanish American war. So, yeah, there's a government tax on pharmacists to fund the Spanish American war.

And the pharmacist did like the ban. And so they found that their individual voices weren't loud enough, but when they pooled their voices in a collective unified voice, their voices exponentially got louder and were heard. And so I think the same, you know, 123 years later, NCPA still shares that DNA from that group of pulling independent pharmacists together.

Unifying those voices. Our collective voice is so much louder and more potent than individual voices that I do think that's something that we have to, you know, have a collective voice around warding off the PBMs, trying to, just to steal our birthright, you know, our, our ability to provide patient care services because they, they again, will try to step in our shoes and take it if.

As you start getting rougher on the PBMs, we already talked about how they're getting nastier against independent pharmacies, but do you feel the pressure of that going to you? I mean, I doubt that you've woken up to a horse head in your bed or something like that, but do you ever feel the pressure? Not running the organization, but them coming after you, because you're representing everybody that wants to come after them.

You mean the PBMs coming after me? Yeah. PBMs. It crossed my mind. 

Mike Koelzer, Host: I don't want to put worries into your head and I'm not really talking about threats. God forbid, I'm not talking about threats. I'm talking more like pressure to you. 

Doug Hoey, CEO, NCPA: Yeah, not so much. The PBMs from that standpoint. I mean, I do wear mirrors on my shoes and always put those under my car before I start it um, smart man.

Whenever I'm in a parking lot and always check the back seat, um, and the trunk, but, um, no. I mean the PBMs inherently want to stay quiet. They do not want to step out of the shadows at all. Just from several years ago. One of the nastiest calls I got from a PBM executive was, um, you know, when I'd been interviewed in Wall Street, I think it was Wall Street Journal, New York times.

I forget which one, but I call them out. And he was not happy about that and, you know, sucks to be him, I guess. But [00:15:00] I mean, it was the truth. And as long as we're speaking the truth, I'm, you know, a little bit of a, maybe, uh, an optimist and thinking that the truth eventually comes out, it may take a long time, but the truth eventually comes out.

So now I'm not really, I mean, the PBMs don't really want to get into. Sparring match because they know they'd lose. So it made it even more curious that they would go after independent pharmacies. You mentioned the truth campaign that, uh, NCPA instigated working with some of our state association partners.

But that campaign was in response to PCMA, which is. The trade association has 16 members, 16 corporations as their members. And they're the mouthpiece for these 16 corporations and they attacked in 18 states. They attacked independent pharmacies during a pandemic, as we're trying to help save the world, vaccinate America, they're putting up billboards on, you know, on interstates saying that independent pharmacies are responsible for high drug prices with.

I mean, nothing could be more laughable. Um, so that was a weird one to me. Um, why would they try to pick that fight, but for the most part, and you noticed it was their trade association, the individual PBM will almost never, you know, come out of the shadows. They want them, they let their trade association do their dirty.

But for the most part to your question, they want to stay behind the scenes. They don't want to be talked about because when you start talking about them, it's not, you start uncovering a lot of, um, dirty laundry, very quickly. 

Mike Koelzer, Host: They thrive on smoke and mirrors and not having probably a visible leader and then not attacking baseball or apple pie or pharmacy.

Who is in that same group in America? 

Doug Hoey, CEO, NCPA: Yeah. I tell you, Mike, I tell you two other things I think they thrive on. And one of them is the complexity of our pharmacy payment system, which is one reason why NCPA our mission is to change the pharmacy payment model, because I think that some of it's been organic, but I think the PBMs have contributed to making it as complex and cumbersome.

And COVID. As possible. So no one can freaking understand it. I mean, you start talking to a normal mortal about the pharmacy payment system and their eyes start rolling into the back of their head within 13 seconds, because it's so complicated. So I, I think, you know, that's, um, that's one of the things that they've done to really kind of hide behind.

The system, you know, where they've tried to make it as obscure as, as, as possible, because then no one understands it. 

Mike Koelzer, Host: I was driving a couple days ago and I happened to be listening to one of my podcasts that's coming out. So I was kind of editing it, listening to my head and I was talking to a transparent PBM.

He was going pretty quickly talking about, you know, the insurance and the PBM and the payments and gross to net and all this kind of stuff. And here I've been in the business for like 40 years. I talk about it for hours a week and I was even trying to piece the puzzle in my head together. I'm like, okay.

When he says, go to know, okay, you know? Yup. The. PBM pays the pharmacy. Then the insurance has to pay the PBM. Then the PBM gets this from the manufacturer. And like, I'm trying to piece this damn thing together in my head driving. And it's like, I get confused. And this is what I do, you know? So yeah.

Purpose it's it's big smoke and 

Doug Hoey, CEO, NCPA: mirrors. Yeah, absolutely. We were talking to one of our industry partners just in the last few weeks and they shared some data. I thought it was really illuminating. And that is that over 70% of the time, the pharmacy doesn't know at the point of sale what it's going to be paid, which is up, which is almost four and a half times higher than what it was five years ago.

So five years ago, you know, maybe one in 20 prescriptions, you didn't know if that reimbursement was really what you're going to get paid. Now it's almost three out of four. And so talk about smoke and mirrors. That's exactly the game that PBMs play. Because if you don't have the information, you don't have the power, you don't have the data.

It's harder to argue your point. 

Mike Koelzer, Host: With this payment stuff. And I love talking to different people because there's [00:20:00] litigation, there's even contract law, changing the payment models of just the day-to -day things, but there's also political stuff. And so we hear a lot about vertical integration and I've talked to some people and they say, that's where the problem is.

I imagine that's federal trade. I know the NCPA kind of promotes that. What power does the FTC have? And we talk about smoking mirrors. Is this even smoke and mirrors for some of the leaders of the FTC? I mean, do they even have problems knowing exactly what's happening and then do they have to be urged to push 

forward?

Doug Hoey, CEO, NCPA: Oh yeah. I mean 120% Mike. Um, so, and it's, it's more. It's more complicated than what it seems at face value. I mean, at face value to our members and to me as a pharmacist is a consumer, it should be really obvious. These PBMs are driving up costs. Uh, it's unfair to small businesses. There should be protections against small business and it's anti-competitive especially things like CVS/Caremark where they can set the price for their competitors.

Um, as well as pay themselves. You know, so to me, and I think to most of our members, it should be, it should be very obviously, you know, a foul, you know, cry, cry, foul, but the way that the FTC looks at things is first of all, they don't really care about small business, um, which is shocking for our members.

To hear it's shocking for me to come to understand over the years, but they don't care about small business. They care about consumers. They're what they're supposed to care about is consumer welfare. And about 40 to 50 years ago, there was a new school of thought that guy named Robert Bork.

And I wrote about this in a, in a, uh, letter to the membership about three or four months ago. Uh, some people may remember this guy, Robert Bork, because he was a Supreme court nominee, um, kind of controversial back in the Reagan years on the way back, but kind of had a funny facial hair for the time, kind of a Quaker oats looking guy.

I was in high school at the time, but that's kind of our memory. Um, but yeah, he was controversial at the time and you know, whether whatever side of the politics you fell on, but he of. Not controversial necessarily because of this philosophy that he brought in, in the sixties that changed the standard for mergers and acquisitions, or maybe evolved it.

And I'm not a lawyer. So if there's any lawyers listening and listening to this, my, my apologies, because I'm sure it won't be exactly as, as you learned it in law school or, um, or as you would say it, but you basically evolve. The, uh, the way that mergers and acquisitions were looked at so that it had a consumer welfare standard.

Does this merger acquisition, is it better for consumers or not? And, uh, and just to narrow it even more, there's a consumer safe money. Is it better? So what does better mean? Well cheaper. Um, and so. For the last 30 or 40 years, there've been very few mergers and acquisitions that have been rejected. And you, you know, someone can always find some, you know, that where they put their foot down, but for the most part, everything has been approved.

And I believe as a result of that, we're seeing the. Substandard, we've seen service levels drop. We're seeing prices start to creep up. Maybe it's maybe some of these mergers have saved a few pennies here and there, but by and large, we're seeing, you know, if anyone believes that, I think they only have to look to airlines and cable companies to find situations where mergers and acquisitions have gotten, you know, they've allowed companies to get huge, but service levels and consumer welfare has, has.

So that's been very frustrating, quite frankly, from an NCPA standpoint, because over the last, you know, my time here over 20 years, we've been making the case, the FTC that these mergers exact positions are bad and we've, uh, we're successful in getting FTC through some congressional pressure to re-look at the CVS Caremark merger, but FTC quote, unquote, re-looked at it and then wave it through it.

Um, we sued to block the ESI Medco merger a few years ago, and we actually wound up in a tie between the commissioners as to whether or not to pursue legal action. And in that case, the tie goes to the merger. So that was allowed to [00:25:00] go through, um, in the last say, six months there's been yet another.

Philosophical, uh, it appears to be a philosophical approach, which we are encouraged by, and that is that maybe big is not always better. And so the FTC has five commissioners, uh, and these commissioners have a lot of influence, a lot of influence as to what gets reviewed and what doesn't get reviewed and what position the FTC takes.

And so just again, in the last six months, Uh, the, uh, new commissioner, uh, commission chair has been named and her name is Lina Khan, a L I N a K H a N. She's actually, she's 32 years old, so I'm not an historian, but she's got to be one of the youngest commissioners and one of the youngest chairs, uh, ever at the FTC and her, she had made her name before as being a very sharp critic of big time.

So she'd written about, you know, the, the typical of folks who are in the limelight as far as big tech, Amazon, Google, Microsoft, some but Amazon, Google Facebook in particular, it's kind of a thing, most of the thing companies, and, um, she, she's now been appointed as head, um, of that agency. They seem to be taking a more aggressive approach at reviewing things.

They've said pharmaceuticals are of great interest to them. We've been very vocal. It had some open forums where, you know, you sign up before all the slots fill up and we, you know, we're setting our alarm clock so we can be the first to sign up for that. And we were successful in getting it. Um, sending letters in, we actually have something going on right now.

It will probably have ended by the time the show errors, but we're asking our members, FTC is asking for comments where not just pharmacies, but anyone had problems with contracts. And so of course we sent that out to our folks. We've gotten over 2000. Uh, well, we FTC has gotten over 2000 responses from pharmacies that have gone through our system.

And, um, and of course we're following up with our own, uh, comments as to how MTC could resolve these things. But it, Mike, I mean the FTC issue, it's really a hot button issue that you can. Our members don't understand why, how the FTC could possibly be allowing all of these mergers and acquisitions. And so, you know, we're crossing our fingers that with the new sheriff in town, that they're willing to actually take some action because in the past they've bought into the PBM fable of.

Whatever to be more efficient or whatever, fable PBMs we're selling them. 

Mike Koelzer, Host: And I've always said with pharmacy, I don't want any favors, just let us play in the game and let the free market take its course. But the lemon law, you could not have the lemon law and you could have a car company sell junk to somebody.

And then it's three in the morning and the person ends up on the side of the road. Car broke down. They bought it, and then they got hit by a truck and died. And then the family sues this car company. And five years later, they go out of business for selling these lemons. But it's like some things can't run, its course, it's going to be too damaging to everybody to let something like that run its course.

And I think COVID pointed well to saying that there's gotta be some laws in pharmacy because if we wake up in 20 years and all the independent pharmacies are going. Well, that's too late. That's where it seems that the FTC does have to have rules and not just let the free market run wild because it goes back to the consumer.

It's not good for the consumer. 

Doug Hoey, CEO, NCPA: It's, it's ultimately not. I mean, there may be some short term. In some cases, there might be some short-term gain for consumers, but in the long term it's not good for them. And, and, and I'm like, you I'm I'm, you know, free market. Let the, the, let the consumer choose the.

Uh, choice, uh, competition is good, but what we've seen is that the deck is stacked against our, our members and, and that's, that's not a competitive landscape when the, when the deck is stacked against one competitor over another, and that's, you know, PBMs have done. 

Mike Koelzer, Host: It's a relatively new nationwide administration, not just the FTC.

Has the current [00:30:00] administration, do they look friendly or not friendly to independent pharmacies? 

Doug Hoey, CEO, NCPA: Um, it's hard to tell so far. Um, they've been pretty good on the COVID side. Um, but frankly, the previous administration, they were pretty good on the COVID side too. They weren't. They just were uninformed at first.

So I served on operation board speed as a, as a supportive, one of the many supportive members of operation warp speed. And you know, the good news was that from the beginning, the government had pharmacies as part of their strategy. The bad news was that the way they spell pharmacy was with three letters, C the and S um, so.

To their credit. Uh, we and other partners, you know, people like some, you know, the wholesalers, some of the, um, the, uh, PSOs were able to open their minds and help them understand that if they didn't include specialty, the independent pharmacies and regional chains, that any rollout of a vaccine was going to fail and not be successful, not be as fast, not be as efficient.

Some of them, you know, it took a little bit longer for that to sink in. Um, but it seemed to sink in and, and, and I think they responded that I think this new administration has kind of picked up where that left off and they've been, they've been pretty good, you know, from a CDC standpoint, um, they've been, CDC has been good to work with, um, The administration has been, they've understood that pharmacies are key to the vaccine.

So I I'd give them up, you know, a B a grade of a B on the COVID side, as far as working with pharmacy, maybe even a, B plus on the PBM side, I give them a C minus D plus on that side, the president just laid out his, uh, Pricing plan, um, about a month or so ago. And it did not include insurance plans and PBMs.

So definitely an F on, on that plan. And, you know, we, we told him, so we, we, we said, so we said, you know, you've, you've swung and whiffed on, on this one. Um, go back to the drawing board because if you're going to try to control drug pricing and don't include PBMs or insurance plans, it'll automatically fail out of the gate.

Mike Koelzer, Host: How much of that is in a vacuum cleaner that they really don't think it's true versus, you know, getting their palms greased by the lobbyists and things like that. I mean, it's probably not fair. You're not in the, uh, the room where it happened. Is there anything left in Washington where people really believe something or is it all just, they got bombarded by one side already.

Doug Hoey, CEO, NCPA: I think it's a mix. I think you have both. I do think you have people up here, like people, I mean, legislators, elected officials and the government appointees who really are here to do the right thing. I really do. I really do believe that. And I think many of them especially start out that way. And I think some of them stay that way.

Yeah. I do think others are thinking about what they're going to do after this. And they're thinking about it. They're not necessarily thinking about their constituents. I also think, you know, I've some friends who work on the hill who work for, you know, senators or members of house members and the amount of issues that they have to be experts on is astounding, overwhelming.

So they have staff, of course, that helped them, you know, feel, think through issues, understand issues. But just the amount of information they have to process and be experts on is, is 

Mike Koelzer, Host: incredible. There's so many sides to everything and so many issues. 

Doug Hoey, CEO, NCPA: Well, and it's not just pharmacy. Of course, we think about pharmacy as being the single star in the sky.

That's all there is. Yeah. That's the way it is to me. Um, and it really is. And I, and I have to remind myself that there is, you know, There's technology, there's agriculture, there's of the shipping industry, transportation, uh, petroleum energy, all these different, uh, industries that, you know, if you're a Senator, you're probably have, you need to have some knowledge about almost all of those and some deeper than the others.

So I think that's part of it because the complexity of pharmaceutical pricing hurts us because. You know, you're there trying to figure out all these other complex issues. And then you add this and the PBMs, I think do come [00:35:00] in and say, we've got it all solved. Just handed it to us. We'll take it from here.

Easy peasy, lemon, squeezy. We've got it all done. You just let us handle it. And so I do think that elected officials and some regulators take that bait now with PBMs being more in the limelight. Uh, I'm being just frankly, I think a lot of that work is due to us and the constant drum beat that NCPA has had over the last 20 years, 30 years on this.

But I do think there's more scrutiny on the PBMs. One problem we have is that, you know, whether it's a PBM or someone else, someone's going to process that. There's going to be someone, whether we call it a PBM, a PBA or something else, going to process a claim. Someone's going to put a network of pharmacies together.

And if you're a government official and you're, you have a plan that has 10 million people, you need someone who can process prescriptions for 10 million people, put a network of pharmacies together for 10 million people and negotiate rebates. For prescriptions from 10 million people. So I think that hurts us too, is that these PBMs have consolidated.

They're almost too big to fail by the standards of some, you know, some government officials. So getting the government to understand our industry is the hardest part. 

Mike Koelzer, Host: I don't mean to compare pharmacy at all, psychologically with the me too movement. You've seen with the women in the Hollywood producers and so on.

But I think that social media is going to play a part. But in getting that story told, because like you said, the FTC, they really care about consumers and. Even as a politician, you've got to know that each industry is going to save the other one for rot and so on. But when it comes down to the consumer, the Internet's use of clearing up some of these smoking mirrors, telling some of those stories of not being able to afford this and, you know, not being able to get to the pharmacy because it closed down because of this.

And so on. I think that's going to be big. I just think those stories are important. 

Doug Hoey, CEO, NCPA: Yeah, you're right. And you know, social media, it can be a great tool if it's used. Rationally. And to your point, the small business stories are important. The legislators do care about small business to some extent because they employ people, you know, they're, they employ people, but even more important are the consumer stories.

So when consumers speak up and say, I don't like this, there's actually, you know, you actually see movement much faster. If a consumer is. Expressing problems, um, or talking about their concerns. And so, and I think social media, I, you know, I told a story to a group I was presenting to the other day that we were with the HHS secretary at the time, Alex Nasar and one of his top lieutenants said, you know, look, we track on social media from pharmacy.

We track on social media, who's tweeting at, or who's mentioning the secretary and there's a bunch of , there's a bunch of pharmacies. And he was talking to me that is blowing us up. That is like being super critical. And my boss is saying, look, I'm trying to help you guys. I'm trying to help them. And they're blowing me up.

Uh, you know, I'm not feeling too warm and fuzzy and, and this, this. Yeah, one of his top lieutenants was saying, can you help us out here? We're trying to help you guys. And you were getting blown up on social media. So, um, yeah, in that case, we tried to get a few more positive things out there to, uh, you know, help him try to help us, which, which he, which he tried to do.

But, you know, from a story standpoint, from, you know, a rational standpoint, it can be great. Tool. If it's used as screeds and rants, then I think it actually is detrimental. 

Mike Koelzer, Host: Do you have to remind or give direction to, for example, the pharmacists that are putting input into the FTC and with that in mind about maybe people going overboard or maybe talking too much about their own needs and not the consumer.

Do you have to remind people to mention the customer in those things? Is that important? Or do you figure that, Hey, they're saying something, even though we just talked that maybe less is more or maybe none is more, do you think that pharmacists, when they complain to the FTC, they have enough [00:40:00] stories of customers and things like that.

Is that something you have to promote? Yeah. Well, 

Doug Hoey, CEO, NCPA: it's one thing where he's, and I mentioned it on this, on your show a few times about the importance of consumer stories, you know, not to be a nag, but just to remind you. Um, you know, our members that when they talk to elected officials and really it's about that consumer, it's about the patient, the customer, the consumer by the FCC.

We actually debated that internally and we provided, um, some suggestions. You know, here's some things you might want to talk about. Um, I think we have three sort of bullet points, but I mean, I'm part of my thought was let loose, you know, Hey, you know, let them hear the raw and unvarnished and they, of course, don't be, you know, I wouldn't want someone if someone's crude or, or are going to be offensive, then that'll get dismissed.

But Hey, you know, our members have some pent up anger out on this FTC needs to hear it. So I think my comment unleashed the hounds. So yeah. Over 2000 comments. We'll make sure that we provide the very, uh, buttoned up lawyered up type of comments that FTC is used to seeing, and that their lawyers are used to seeing.

So if some of those comments, some of those 2000 comments aren't really events and don't give them something to act on. Our comments will certainly come in and say, here's how you could take action. FTC, if you are concerned about all of these comments from these small business owners, which we hope you are, we 

Mike Koelzer, Host: talked about the PBMs and I hate the PBMs.

You know, like most independent pharmacies do well. At least you'll pay PBMs back in the old days. When you hear about Washington, you know, I always picture Tip O'Neill going out for a drink with, you know, someone from the other party we grew up in that age, you know, when they'd go fight it out. And then at night I'll be at the bar together and you haven't seen as much of that in the last few years.

When you come across a PBM person or talk to them, which you do, we don't, because we all think the PBM guys have, you know, horns on their heads and so on. But when you see them in person, do you ever like to go up and tackle them and just like, you know, like pound on them? I imagine if you're like most people, probably when you finally see someone face to face a lot of times, it's the organization that has become.

Maybe overbearing and evil. And you look at individuals in there, unless they're the poster child for that organization, you realize they're normal people and they have families to go home to and all that kind of stuff. Are you able to sit in the same room with these people or does your blood boil, or how do you handle that when you're face to face with these PBM folks?

Doug Hoey, CEO, NCPA: Yeah. I mean, Mike there's, you can handle it. And B you know, call them the devil and just call them names and throw stuff at them. And that would definitely guarantee it'll be the first and last meeting you ever have with them. And that's right. And, uh, you know, as far as any hope of productive dialogue, you can just kind of throw that out the window.

It's just on the other extreme of that, and be, you know, to. Your understanding. And I think that's the wrong move to I, 

Mike Koelzer, Host: oh, it's just a corporation, you know, you're trying your best, all that kind 

Doug Hoey, CEO, NCPA: of stuff. Yeah. BS. Um, I mean to that, I mean, so it's, to me, you have to be rational and sane. They are human beings.

And like you said, They probably have kids that they're trying to, you know, they have families and things like 

Mike Koelzer, Host: that. Probably ugly kids we can agree on.

Doug Hoey, CEO, NCPA: No, no. I mean, they, they, they have families and aspirations and wanting, you know, do what normal people want to do, but you want to make sure, at least part of my philosophy is that they are causing. Pain. They are causing problems for small businesses. They are putting small businesses out of, out of business, um, which harms consumers.

There are some that are more open to hearing, you know, a rational argument. You know, we've been able to work behind the scenes several times and it is usually not on reimbursement, usually reimbursement, you know, and that's something we, as a trade association, can't get into the negotiation. Of reimbursement, um, with, with commercial entities, that's what the PSA is doing.

That's not what we do and what we're allowed to do, but you know, I'll take one signature log. For example, during the pandemic, you know, it was ridiculous to think about. [00:45:00] PBMs requiring signature logs during the pandemic. When you know people weren't coming towards you, you weren't supposed to be face-to-face there's lockdowns.

You know, you weren't supposed to be using the same pins as today. And it was harder than it needed to be, but we did go to the PBMs and say, look, this is ridiculous. You all have different policies. And so that's going to be an audit trout for our members. Which, you know, because one PBM wanted, you know, just as right, COVID on it.

Another person wanted, you know, some other different words and, you know, as, as aggressive as they are with audits, if you get, you know, don't cross a T or dot, and I they're going to slap you with an audit. So we said, you know, and again, the court of public opinion, this would be very unreasonable for you guys.

Not to. Come together. And so they, at least in that example came together to say, we will allow, you know, language, something broader that allows pharmacies to, um, to get those signature logs with less audit risk. There's nothing that doesn't have audit risk, but there was less on respite. So that's an example where they were at least rational to listen to reason.

But yeah, I mean, to your question, They need to hear the problems they're causing. They are open to listening at times. 

Mike Koelzer, Host: Are you ever physically in a room with them? Are you ever at a table with these guys or is this like the stuff we're talking here is just like email or like organization to organization?

Doug Hoey, CEO, NCPA: Yeah, not that often, but on occasion, we're in the same room during the pandemic. Not at all, but on occasion, uh, we're in the same room. And again, it's never to talk about reimbursement because that's something that we, we can't do as a, that'd be collusion. And plus we don't own the contracts with any pharmacies, the contract.

I mean, we can say we, and we do say your payments are lousy, your payments are killing food pharmacies. Your payments are awful. And we could even, you know, tell me, uh, you know, an anecdotal example, but we can't negotiate. Cause again, we don't own the contract with the pharmacy, but we do tell them about the payment pain, the policies that they're, you know, pharmacy Dr.

We've talked with them about that. And now of course we have a lawsuit. Against the federal government for pharmacy DIR is that we filed in January. And, um, several of our independent pharmacies and regional chains are plaintiffs in that PHA as a plaintiff, they've joined our lawsuit. Great. The PBMs, yeah.

On occasion, we're in the same room with them. And we take the case of, you know, what's happening with independence. A lot of times they're going to defer back to their contractual relationships. And of course we say, well, it's. It's a one-sided contractual relationship. It's a take it or leave it. It's not a real relationship.

It's not a bona fide relationship. And so the meetings are not long usually.

Uh, but, um, but yeah, on occasion we are able to take the independence case directly to the heart of the beast. What heart they have, even the Grinch who stole Christmas had 

Mike Koelzer, Host: it's all shriveled up. Congratulations as president of the world pharmacy council with seven or eight different countries. I imagine all this PBM stuff where you're sitting federally is probably one of the most powerful.

Positions. I mean, everybody plays a role, but as far as pricing goes, you could be sitting here as president of a state association, or like you currently are the president of the world pharmacy council. Or with the NCPA representing 22,000 pharmacists. Is there any world pricing stuff? How big are these vertical organized PBMs?

Does, does it play a part on the world stage or not at 

Doug Hoey, CEO, NCPA: all? So one of the things that I brought back from being part of the world pharmacy council is that we do, you know, the other countries talk about their payment model. How does it work in your country? And. And this is something I've been saying for several years and actually I saw it and I've even seen it in news stories lately.

So, you know, I've got a lot of presentations sprinkled around the internet. So I'd like to think that this is, this came from something I said, but the United States is the only country that I'm aware of in the world that has handed the prescription drug benefit of [00:50:00] its citizens over to PBS.

Canada has a small PBM presence, but it's not like the entire prescription drug benefit for basically every citizen has been handed over to Canada. And as far as I know, I think South Africa has a small presence of PBM, but the United States, the country that not coincidentally has the highest drug prices in the solar system.

How is it the only country that's handed it all over to PBMs? And I don't think that's a coincidence that we have the highest drug prices in the world. And we are the only ones who use PBMs. So that should be telling, I mean, it's not like the United States is wonderful, there's a lot of many parts of its health system that are wonderful, including innovation, research, things like that.

I would say the best in the world, you know, we're the best in the world, a lot of things, but that's an area where the best in the world, when it comes to preventative conditions, chronic conditions, life expectancy, we're kind of middle of the road. Um, and our drug prices are crazy high. So even though as great a nation as we are, there's a lot we can learn from, from other countries and including, and not that they're perfect.

But including different ways to do a prescription drug benefit. So when we do have those, oh, how does it work in your country? You know, China is not one of the countries that's in the world pharmacy council, but it's like, when I talk about it, it's like speaking Mandarin Chinese, you know, no one, no one really understands what I'm talking about.

They do now after so many years, but you know, PBMs are a foreign concept, literally, literally. Yeah. It is. So it's been helpful in the world, pharmacy council, you know, one of the things it's done is it's, it's given us a chance to look at how people and other, you know, how, how pharmacies and other countries practice, how pharmacists practice, you know, we learned like in the pandemic before hand sanitizer was in short supply.

I heard a portrait. That pharmacists were beginning to compound it because it was in short supply. And then about a week later, it became a big issue here in the US flu season. You know, the flu season in the Southern hemisphere tends to, because the, you know, the seasons are reversed. It tends to run ahead and be predictive of the flu season here.

So we were able to get kind of a sneak preview of what it might be. It's not a hundred percent. But at least an indication of what the flu season might look like last year, talking to our friends in Australia and South Africa. So it's not a huge part of my time, uh, because the other 70 hours a week are dedicated to NCPA, but I think it's been helpful to the w you know, my perspective, which I think has been, is helpful to our members.

I hope so. 

Mike Koelzer, Host: The annual convention is back on live this year. What makes you smile the most thinking that you're going to be alive again? You know, 

Doug Hoey, CEO, NCPA: The thing is that, whether it's at the annual meeting or it's a phone call or an email or a text, I shamelessly live vicariously through our members. So I practiced for five years as a pharmacist and I grew up in a pharmacy and I knew the people I can still to this day picture faces of patients.

That I went from being a, you know, a 14 year old pimply clerk, trying to figure it out my butt from second base to, you know, a practicing pharmacist, helping counsel them on their medication. Um, and whether that was at my dad's store or one of the other, uh, independents I worked at before I came to NCPA.

So those connections, you know, when I'm talking to not only. Old friends, but also new people. I really love meeting new people at the annual meeting or anywhere just because it's a new connection and I'm shameless. I live vicariously through them, especially their business successes. You're consumed by their stories about helping patients.

You know, I love the stories where they've helped a patient and it's also been a profitable excursion for them where they've combined business and. Taking care of patients at the same time. That's what still makes me excited. After all these years, that's 

Mike Koelzer, Host: probably enjoyable to really be with someone and to be talking to them about that.

Oh, 

Doug Hoey, CEO, NCPA: short of being actually in the pharmacy. And occasionally I will just kind of drop into the pharmacies. I did a couple in Colorado, uh, this last July, but short of [00:55:00] actually being on premises. Yeah. Being in person and you're right. Third to that would be a phone call or zoom or, or texts, but you know, nothing beats that human connection of being able to.

Not across the table or, you know, I'm all the eyeballs, someone, and for them to tell you what's going on in their pharmacy and, and your something good. 

Mike Koelzer, Host: So a pharmacist listening to this says, I want to get five minutes to something I heard today. What would that be? Would it be pulling up their computer and learning about NCPA or learning about.

C PSN or writing a letter to somebody or learning about something they're only able to get five minutes on the computer. What should it be? 

Doug Hoey, CEO, NCPA: That's a good question, Mike. I would say if they don't know about NCPA to spend that five minutes learning about us, what we stand for, we exist for pharmacy owners.

And patients and, you know, the patients they serve. So I'd like for them to learn more about us, they're going to have a hard time scratching the surface of our website in five minutes, because it is information dense. It is part of that because our members are into so many different areas. Uh, uh, it's hard to narrow it down, but that would be the first thing if they know about NCPA and they haven't gotten into CPS in that, when I talk about changing the pharmacy payment model, one of the big components of that is practice transformation.

And because practice transformation leads to payment for those, uh, patient based services. So CPS would probably be the second thing. And then if they already have CPS in, uh, understood and are participating in that, then I would say, take that five minutes to reach out to a state, probably a state or federal legislator and what I'd love to see, and this is getting greedy, but if they would take five to 10 minutes, And reach out to state legislator, federal legislator, and just tell him what's going on in their business.

You know, things are going well here. Things are not going well. Here's who I am. Here's why you should care about me because I've got, you know, a thousand patients walking through my door every week, every month, just to develop that relationship. Even if that legislator can't do something for them today, because.

Whether you're a state legislator or house member, Senate member, and you're not on a committee of jurisdiction. You may be someday, or you're a state legislator, maybe someday you're the governor. Maybe someday you are, you know, a member of the house of representatives at buddy Carter, you know, pharmacist in Congress.

He was in their state legislature for years before he came to Washington. So. If you're not a member of NCPA, please become a member. Most people are the vast majority of independents in our members, but we don't have a hundred percent and I'd love to have 100%. And then second CCSN, if you're ready, there's 3,500 pharmacies that have signed up for it, but you gotta be ready to do that.

And then a third is every month, 10 minutes, invest in your business to reach out to your legislator. Moving around state, federal Senator and let them know that you're out there and you need their help and they should care about you because of the patients. 

Mike Koelzer, Host: Well, Doug golly, nice meeting you. Thanks for your time today.

Thanks for everything that NCPA is doing on behalf of pharmacists. It's exciting times as we started off with, and it's a lot of fun watching. 

Doug Hoey, CEO, NCPA: My pleasure might need to do this again. Sometimes it was fun. I could talk about this stuff forever. Uh, so it's, it's what I believe in, and it's what NCPA believes in and our board of directors.

So thanks for that.