A spokeswoman for Rite Aid says the company must “cover our costs and make a fair profit.”
AUGUSTA – Rite Aid Corp., the largest drugstore chain in Maine with 80 pharmacies, called a $1.3 million state budget-balancing provision “devastating” on Tuesday and said its implementation might prompt service reductions and store closings.
The warning came as the Baldacci administration is preparing to seek legislative backing for a $109 million savings package that would touch much of state government and include a cut in dispensing fees that pharmacies receive for individual prescriptions from $3.35 to $2.
Rite Aid, which handles about 25 percent of the prescription drug business handled by the state Medicaid program known as MaineCare, also said it had recently informed officials it would not participate in a new discount drug program – Maine Rx Plus – that the state plans to launch.
“Re-evaluating our MaineCare services and not participating in Maine Rx Plus are not decisions we make lightly since those most hurt will be our MaineCare patients and Maine residents without prescription coverage,” Rite Aid President and Chief Executive Officer Mary Sammons said in a prepared statement.
“But while we want to keep serving all of our customers, we still have to cover our costs and make a fair profit,” said Sammons, who spoke personally with Gov. John Baldacci.
Rite Aid operates about 3,400 stores nationwide and has annual revenues of more than $16 billion.
Baldacci’s top aide on health care issues, Trish Riley, said Maine officials had sounded out pharmacy industry representatives about ways to curb state costs and had altered their original plan to lower prescription reimbursements directly.
“The fact is we still pay better than a lot of third party payers,” said Riley, who heads the state Office of Health Policy and Finance. “We thought this was more tolerable.”
The full Legislature convenes for its 2004 regular session Wednesday and the Appropriations Committee is expected to open hearings on Baldacci’s budget plans next week.
“We’ve got to meet the budget target and we’ve got to do it now,” Riley said.
An administrative rulemaking proceeding on some proposed Medicaid cutbacks is slated for Thursday.
Critics complain that planned cuts in state funding would also reduce matching federal money that might be used to aid low-income Mainers.
Rite Aid said its pharmacies had begun distributing handouts Monday to prescription patients encouraging them to call the governor to urge that the proposed reimbursement reduction be scrapped.
“What would you do without your local drugstore? On January 20, you might find out,” the message says.
Saying that some drug stores might have to shorten pharmacy hours, stop filling MaineCare prescriptions or close altogether, Rite Aid also said pharmacists were contacting state lawmakers and the governor to protest.
Riley did not rule out new discussions between state officials and pharmacy representatives but also declined to say that new talks would occur.
“If Rite Aid leaves the business, the business is still there,” she said, pegging Rite Aid’s share of the state’s Medicaid prescription business at about $71 million and its potential losses at 2 percent.
AP-ES-01-06-04 1505EST
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