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The Impact of the Affordable Care Act on Pharmacy Billing

 In developing the ACA, lawmakers were tasked with providing consumers with affordable drugs. Without restricting the pharmaceutical market or limiting medical progress. Instead of addressing the actual costs or cost structure of drugs, the ACA focused on improving access to health care plans. Thus, the total burden of prescription costs fell on federal programs and insurance companies. The ACA also sought to increase drug rebates to reduce costs.

Goals of Affordable Care Act

The Patient Protection and Affordable Care Act, referred to as the Affordable Care Act or “ACA” for short, is a comprehensive health care reform law enacted in March 2010.

The law has 3 main objectives:

  • Make affordable health insurance obtainable to more people. The law provides subsidies to consumers (premium tax credits) that reduce costs for households with incomes between 100% and 400% of the federal poverty level (FPL).
  • Expand Medicaid to cover all adults with incomes below 138% of the FPL.
  • Promote innovative methods of providing medical care to reduce overall healthcare costs.

Essentials Health Benefits

  • Emergency services
  • Hospitalisation (surgery and inpatient care)
  • Laboratory services
  • Services related to mental health and substance use disorders (including behavioural health care such as counselling and psychotherapy)
  • Ambulant care
  • Pregnancy, maternity, and newborn services (includes prenatal, delivery, and postnatal care)
  • Prescription drugs
  • Preventive care, wellness services, and chronic disease management
  • Rehabilitation and habilitation services and facilities (to help people gain or restore skills after injury, as well as amid disability or chronic conditions).

What has Not Covered the ACA Benefits

Basic health benefits do not include some services, such as:

  • Dental coverage for adults, although some plans may offer this as a benefit
  • Vision coverage for adults, although some plans may offer this as a benefit
  • Long-term care service
  • Vasectomy.

Impacts of Affordable Care Act on Pharmacy Billing

Here are;

Payments for Medications:

One area the Affordable Care Act addressed was determining how Medicare reimburses all pharmacies for selling generic drugs. Before the legislation, the amount of reimbursement offered to pharmacies was often lower than their actual acquisition costs. The impact of this change will improve the annual Medicare payments that pharmacies receive from the government. The amendment also expanded the number of covered entities eligible for drug rebates under the 340B program. However, the discount does not register with hospital patients. The new guidelines help covered entities enter into new contracts with more pharmacies that use their services.

DME Accreditation Regulations:

Some pharmacies that offer durable medical equipment (DME) through Medicare may not meet accreditation requirements. This exception does not apply to those pharmacies that want to participate in the tender process. The criteria for obtaining an exemption from DME accreditation include many provisions. This exemption only applies to pharmacies that have been enrolled in Medicare for at least five years.

DME billing must be five percent or less of the pharmacy’s prescription sales. Pharmacies must have an absence of allegations of adverse fraud and abuse within the past five years. The DME billing percentage is determined based on a three-year average of all billings. And must be less than five percent of the pharmacy’s sales. Each pharmacy is also required to submit all documentation to verify its eligibility before an exemption is granted.

Rise of High Deductible Health Plans:

Payers have begun raising their premiums to compensate for the challenges associated with the health insurance exchange environment. In response, patients try to choose plans that offer the lowest possible monthly premiums. Even if those reduced costs are offset by higher out-of-pocket deductibles that must be paid when they receive care.

Improve Health Quality and Curb Costs:

The ACA requested investments in health information technology. It addressed guidelines to reduce medical errors and create payment mechanisms to improve efficiency and results and improve care coordination among providers. The act requires oversight of health insurance premiums and practices, reducing health care fraud and uncompensated care to foster comparison shopping in insurance exchanges to increase competition and price transparency.

Reducing Medications Waste in Pharmacies:

The Affordable Care Act requires Medicare Part D enrollees to become more involved in dispensing drugs to patients while reducing drug waste. This plan was created in 2012 and all healthcare facilities are required to look at how they dispense drugs to Part D enrollees. Everyone in the industry is trying to reduce the number of drugs that are wasted every day. The risk of this new effort is that pharmacies will have to dispense drugs more often. To offset the increase, it is not necessary to add the increased dispensing fee to the fees.

How this law will affect pharmacies in the future is unclear. No one in the industry can predict how the implementation of regulations will change. The federal government must provide some guidance on healthcare issues that concern pharmacies.

Also Read:

Pros and Cons of Affordable Care Act 


  • It expands the availability of health care for more citizens.
  • Prevents insurance companies from disproportionately raising rates.
  • Individuals with pre-existing medical conditions cannot be denied.
  • Coverage of additional screenings, immunizations, and preventive care.


  • Those who were already insured saw their premiums increase.
  • The taxes were created to help supplement the ACA, including taxes on medical equipment and drug sales.
  • Registration time is limited for new applicants.
  • Many businesses have reduced employees’ working hours to avoid providing health insurance.

Recommendations for the Future

The ACA did not introduce systemic changes to the actual cost of prescription drugs.

One of the key reasons was the fear that it could hinder the development of new drugs. Pharmaceutical companies continued to develop new, life-saving drugs. However, they are now some of the most expensive drugs available. So, the question of affordability remains.

  • Improving access and affordability: Reducing out-of-pocket drug spending.
  • Addressing high drug prices: Eliminate incentive programs that encourage doctors to prescribe higher-priced drugs over more affordable ones.
  • Advice on evaluating drug prices: Analyse cost-effectiveness and determine coverage and reimbursement strategies.


The Affordable Care Act increased the number of people covered by insurance and helped lower healthcare costs. Its continued implementation is needed to make further progress. By making health insurance more accessible and affordable, increasing coverage, funding, and support for community-based public health and prevention programs, and tracking key health measures, the ACA begins to reduce health insurance disparities, increase access to preventive care, improve outcomes in health and reduce the rate of growth of national health expenditure.

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