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Medicaid Managed Care Drug Rebates Saved States, Feds $1.6 Billion in First Year
Date:9/12/2012

and increasing generic substitution. The $1.6 billion documented in the OIG's Report reflects only the revenue states collected from pharmaceutical companies in statutory rebates; states realize even more savings from better care coordination.

The pharmacy carve-in model is made possible by a provision in the Affordable Care Act that allows states to capture rebates on pharmacy benefits provided through managed care, which was previously limited to only traditional fee-for-service Medicaid. This "Drug Rebate Equalization" was a top legislative priority for MHPA for many years.  The OIG report found that the rebate expansion has prompted five states – Illinois, Ohio, New York, Texas, and Utah – that previously used the carve-out approach to change to a carve-in approach, showing the importance and far-reaching effect of this legislation.

"Including a treatment option as important as prescription drugs in Medicaid managed care contributes to the strength of the coordinated care model," Johnson noted. "This integrated care benefits all patients, especially those with multiple chronic conditions like the population dually eligible for Medicare and Medicaid. Medicaid health plans' proven care coordination strategies like the pharmacy carve-in can go a long way in terms of keeping costs down as is shown in this report. But, more important, models like this move us closer to improving outcomes for our nation's most needy."

About MHPA
Medicaid Health Plans of America is the leading national trade association solely focused on representing the universe of Medicaid health plans. MHPA provides advocacy, research and organized forums that support the development of policy solutions to enhance the delivery of quality health care to Americans in need.

Media Contact:
Joe Reblando
202-857-5722
jreblando@mhpa.org


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SOURCE Medicaid Health Plans of America
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