Anyway, yes there are issues with payors (I'm ignoring Medicare and Medicaid becuase they are special case clusterfucks). When Gardasil was coded, no one knew what the price from Merck was going to be. So there were estimates all over the place built into fee schedules. Some were low. The first year, reimbursement could have been far below purchase price. Payors fixed this. We took care of it quickly so our peds were ok. Most immunizations and injectibles are usually updated quarterly on fee schedules and payors, while they might love to, don't expect to reimburse less than the purchase price of the drug/vaccine. In cases where they do, it's usually because of price changes or poor price estimates.
Which brings up the issue of price and cost. The article you quote has RotaTeq at $190 for 3 doses. Redbook has average wholesale price at around $83/dose ($833 per 10 dose vial). So something doesn't add up. [EDIT: And Gardasil is about $150 and the article has $360. AAP is using some funny numbers] I will say that our providers pay roughly around AWP and don't lose money on RotaTeq, MMRV, or Gardasil, taxes included.
Inventory control is part of the cost of doing business. If offices are writing off large amounts of vaccines to spoilage, they need to monitor their stock better. Note that for each set of injections there is usually also an office visit, injection fee, and equipment (needle/syringe) billed as well which can help cover overhead such as inventory control.
I guess it all comes down to this:
That practice needs to renegotiate their reimbursement or terminate participation with that most common payor.One practice reported that the vaccine purchase price exceeded the most common payer reimbursement for 15 of the 21 vaccines, the researchers said.
It's hard out there for a ped, no doubt. But it's like any other business. You don't end up with a successful restaurant by simply being a good chef. You don't end up with a great GC business simply by being a great builder. You don't have a profitable pediatric practice by simply being a good doctor and giving shots. Does every pediatric office that opens have an automatic right to profit?