Walgreens May Quit Calif. Comp Rx Program
By Daniel Hays
NU Online News Service, Feb. 4, 12:15 p.m. EST? Walgreens drug chain announced yesterday that unless California increases what the workers' compensation system pays to fill injured workers' prescriptions, it will drop out of the program.[@@]
The Deerfield, Ill.-based company, which has 361 stores in the state, said it was giving the legislature 30 days to restore cuts in reimbursement or it would begin rejecting workers' comp claim prescriptions and ask injured workers to pay the full retail price.
Walgreens, one of the largest prescriptions drug chains in the state, today called on legislators to increase reimbursement to "acceptable levels, as currently reflected in Senate Bill X4-10."
If that isn't done in 30 days, "Walgreens will require cash payment from patients for workers' compensation prescriptions," the company said.
Walgreens Chairman Dave Bernauer said "the state must understand the urgency of resolving the workers' compensation issue."
California's workers' comp rates that took effect Jan. 1 are among the lowest in the country, according to Walgreens.
Mr. Bernauer said the California payments "no longer cover our costs of the considerable expenses of processing workers' compensation claims. That's why we urge the governor and the legislature to work together to address this serious issue."
Gov. Arnold Schwarzenegger himself has given the legislature a deadline of March 1 to pass measures to fix the distressed system. However, the issue apparently will not be solved until November when one or more ballot initiatives to reform the system are put before California voters.
Walgreens said if it stops processing workers' comp claims next month, injured workers will need to pay the normal retail price and file with their employer or insurance company for reimbursement. "We hope we can avoid this inconvenience for our patients," said Mr. Bernauer in a statement.
Nationally, Walgreen Co. is the largest drugstore chain with fiscal 2003 sales of $32.5 billion. The company operates 4,313 stores in 44 states and Puerto Rico, including the 361 in California. The company also operates Walgreens Health Initiatives, which provides pharmacy benefits management, mail service prescriptions and other clinical services.
Michael Polzin, a company spokesman, said today he had seen printed comments from one legislator who "didn't think we could legally charge retail rates. But if we dropped out of the program we wouldn't be bound by its rates."
He said a pharmacy industry group estimates that 10 percent of all the prescriptions filled by all drug stores in the state are for the workers' comp system.
Mr. Polzin said Walgreens does not release figures on the amount of business it does in California.
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