May 27, 2009


Steve Evans has run a business in Dare County for 33 years and on Hatteras Island for 18 years. Tim Morgan has run his business on the island for 24 years.

Together they know just about everyone on Hatteras and Ocracoke islands, and just about everyone knows them. They are the island pharmacists, providing vital services to residents of both islands and to summer visitors.

However, Evans and Morgan worry that their days in business are in danger of ending.

The rising cost of health care is an issue that has left millions of Americans either underinsured or uninsured. It is an issue even for those who have insurance, and it has both insurance companies and employers trying to cut costs.

Caught in the squeeze are independent pharmacies, such as Beach Pharmacy in Avon and the Beach Pharmacy in Hatteras, and the health and well-being of island residents and visitors.

The pressure on independent pharmacists is coming primarily from pharmacy benefit managers, or PBMs, that are often hired by governments and large companies that offer prescription drug coverage to their employees.

The main concern for the PBM is improving the employers’ bottom line, and they do this through a variety of ways that some would call questionable. The most recent is to force clients to fill their prescriptions through large mail-order pharmacies run by the PBM itself.

Not only are these PBMs directly taking business away from local, independent pharmacies, they are paying pharmacists less and less for the prescriptions they do fill.

“Eighty six percent of all health care cost is elsewhere,” says Evans, “yet we’ve been cut the most.”

It’s come to the point that, in some cases, because of the difference between the cost of filling a prescription and the amount the PBM reimburses them, pharmacists like Evans and Morgan can actually lose money on a prescription transaction.

“We just have to hope they buy some sunscreen with it,” Evans joked, though, unfortunately, it’s probably too close to the truth to really be funny.

An immediate concern for Evans and Morgan is a bill, aimed at appropriating funds and making “other changes” to the state’s health care plan for its teachers and other employees, which was signed by North Carolina Gov. Beverly Purdue last month.

The new measures found in the bill, now session law 2009-16, will spell some pretty big changes for state employees and their dependents, including, but not limited to, increased premiums and co-pays, stricter eligibility requirements, and changes in coverage.

Though most of the changes in the bill will affect only those on the state plan, the changes regarding prescription drug coverage could mean big changes for all Hatteras Island residents and visitors, whether state employees or not.

In order to cover the shortfall in funds for their health care plan, the state plans to, among other things, shave an additional $38 million off its health care costs over the next two years—$18 million in the 2009-2010 fiscal year, and $20 million from 2010 to 2011—“through reduced reimbursements paid to pharmacies for prescription drugs.” 

The new plan also mandates that, in order to be covered under the state’s prescription drug plan, all “non-acute specialty medications” must be filled through a “specialty vendor” contracted by the state.

According to Morgan, the list of drugs considered non-acute specialty medications “could be a really long list.”

He also says that “as of the writing of this bill, we don’t know who will be authorized [specialty vendors],” but, “they have not offered us a contract.”

These changes are set to occur on July 1, which leaves very little time for Evans and Morgan to get on the list of specialty vendors.

Ultimately, that means that they will be getting less money to fill fewer prescriptions—a lethal combination that could very well force our local, community pharmacies to shut their doors.

According to Evans, “if we were to lose the state [employees], we would have two options -- quit accepting any insurance or shut down.”

Either option would have devastating consequences for the local economy, and most importantly, would seriously compromise the health and safety of community residents and visitors.

“I was here before we had [the community pharmacies],” says Allen Burrus, lifelong island resident and vice-chairman of the Dare County Board of Commissioners. “I believe that they’re very important to the island.”

The problems with not accepting insurance are pretty obvious, but the ripple effect that would result from the pharmacies shutting down altogether—while slightly less obvious—could be even more problematic.

Economically, no pharmacies would mean lots of money traveling off the island—to Medco’s mail-order facility in New Jersey or to pharmacies in Nags Head, Kill Devil Hills, or even Virginia, that qualify as appropriate vendors.

Medically, it means that patients will not only lose direct access to prescriptions, but also to counseling on such matters as dosage and drug interactions from a local pharmacist, a loss that would almost certainly lead to an increased need for emergency medical care.

That’s a scary thought, especially when you consider the distance from Hatteras to emergency medical care facilities.

It’s also highly unlikely that off-island pharmacists and pharmacies would be able to meet the unique challenges facing islanders. 

How will patients get their medications when Highway 12 washes out in Rodanthe, prohibiting the mail from running and preventing islanders (or visitors) from leaving the island to get to a pharmacy?

Or even worse, what happens in the event of a hurricane?

After Hurricane Isabel created an inlet between Frisco and Hatteras village in 2003, Evans and Morgan went above and beyond—particularly Evans, a Kill Devil Hills resident, who fought his way back on the island in order to deliver medication to residents of the storm-ravaged villages.

It’s difficult to imagine employees from off-island suppliers doing the same.

And what happens to Ocracokers, who have no pharmacy and frequently rely on those on Hatteras?

Or visitors to the islands who, in a flurry of vacation excitement, forget their prescriptions at home, and just need a one- or two-week supply of medication?

 Evans and Morgan would no longer be able to service those needs. And for them, that’s the worst part.

Business and financial difficulties aside, at the end of the day, it’s the thought of not being able to share the skills they spent years studying and decades perfecting that really has Evans and Morgan upset.   

“We came here to serve the area,” Morgan explained, “not to get rich.”

 

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