Prescription Drugs

While the Medicaid outpatient prescription drug benefit is not a mandatory benefit, all states provide this benefit in their Medicaid programs. As of 2014, Medicaid spending on outpatient prescription drugs registered at $27 billion, or about six percent of Medicaid spending.

As a significant cost center, states continue to struggle with controlling Medicaid prescription drug spending including the high-cost of “specialty” drugs. Emerging issues such as specialty drugs will continue to have broader implications for the administration of the Medicaid Drug Rebate Program (MDRP).

MHPA Policy Statement on Medicaid Drug Rebates

“MHPA applauds Congress for extending prescription drug rebates to states for Medicaid health plan enrollees through the Patient Protection and Affordable Care Act. This ends a long-time disparity in law that disadvantages states from receiving additional rebates for drugs simply because Medicaid beneficiaries are in Medicaid health plans. We believe this is a tremendous improvement in the administration of state Medicaid programs and will help improve care coordination and the quality of health care for Medicaid members.

MHPA Submits Comments to HRSA on 340B Guidance

On October 26, 2015, MHPA sent comments to Director Pedley at the Health Resources and Services Administration (HRSA) on the 340B Drug Pricing Program Omnibus Guidance. Also included in the comments is an appendix on concerns regarding 340B hospital profit margins and average wholesale price (AWP) inflation.  Read the full comments.

CMS's Initial Guidance on Implementing Medicaid Drug Rebate Increases and Equalization

On April 22, 2010, CMS issued a letter to State Medicaid Directors providing initial implementation guidance on the Medicaid Prescription Drug Rebate provisions in the Affordable Care Act. The letter provides information on the increased rebate percentages, the extension of the rebates to covered outpatient drugs dispensed to Medicaid MCO enrollees, and the rebate offsets.

The letter clarifies that any covered outpatient drug provided by MCOs are eligible for rebates; MCO capitation rates shall be based on actual cost experience related to rebates and subject to actuarial soundness rules; and data MCOs must report to the state. CMS will be issuing further guidance on the drug rebates in the future. Read the letter.

ACAP and MHPA Letter on Drug Rebate Equalization

House and Senate negotiators should add language in health reform legislation clarifying that health plans should have the ability to manage their own formularies, according to a letter sent on December 29, 2009 by MHPA and the Association for Community Affiliated Plans (ACAP). While the two trade associations representing Medicaid managed care plans expressed strong appreciation for including language extending rebates to pharmaceuticals provided to Medicaid managed care enrollees, they recommended a set of improvements to the language that would improve benefits for low-income Medicaid beneficiaries. Read the letter.

The Sovaldi® Squeeze: High Costs Force Tough State Decisions

To examine how states are wrestling with the blockbuster drug Sovaldi® and its high treatment costs, Viohl & Associates reviewed coverage decisions and restrictions in state Medicaid programs. Download the full report.

MHPA's Best Practices Letter to the Hill

On November 14, 2014, MHPA sent a letter to the Senate Finance Committee and House Energy and Commerce Committee on best practices in nine areas of Medicaid managed care, including rate-setting, care coordination, encounter data accuracy, quality measurement, and program integrity. The letter is a response to a bipartisan letter sent to MHPA and other associations asking for the best practices submission.

MHPA’s letter highlights the benefits of Medicaid managed care as a payment and delivery system compared to fee-for-service and PCCM models. MHPA describes specific best practices, mostly  obtained from MHPA’s newly released 2014-2015 Best Practices Compendium, spearheaded by health plans and states in each of the categories. Read the full letter.

MHPA's letters to Senator Charles E. Grassley & Senator Ron Wyden regarding the price of Sovaldi and its impact on the U.S. health care system. (March 4, 2016)

Letter to Charles E. Grassley
Letter to Ron Wyden