Monday Morning Medicaid Must Reads:September 10th, 2018

Helping you consider differing viewpoints. Before it’s illegal. 


Article 1:  

HHS Secretary Alex Azar warns drug makers to pay full Medicaid rebate amount, Susan Morse, Healthcare Finance, August 10, 2018

Clay’s summary: Who the heck let them get away with this between the years 2008 and 2016?

Key Passage from the Article

“In fact, I am pleased to announce here, to all of you, that HHS is issuing a guidance today to drug manufacturers that will ensure they are paying the full Medicaid rebates they owe on certain prescription drugs,” HHS Secretary Alex Azar said Thursday during the 45th American Legislative Exchange Council Annual Meeting in New Orleans. The Medicaid drug rebate program requires prescription drug companies to pay rebates to states on drugs purchased by Medicaid, where about 10 percent of drug spending occurs. Sometimes, drug manufacturers roll out what’s called a “line extension” for a drug, such as an extended release, once-daily form of a pill they already sell and some of them have used it to reset the price that’s used to calculate the inflation rebates they have to pay, Azar said. This means they could pay less than they would otherwise owe, just by introducing a new drug formulation. “This is the kind of abusive behavior from drug companies that this administration will not tolerate,” Azar said. “Starting today, we’ve made clear that manufacturers must pay the full amount of rebates that they owe under the law.”…


Read it here 

Article 2:   

Texas Tightens Disclosure Rules Following Medicaid Investigation, Liz Whyte, NPR, August 17, 2018

Clay’s summary: How is this even a thing?

Key Passage from the Article

A Medicaid committee in Texas is requiring those who comment at its meetings to disclose more details about their ties to pharmaceutical companies after a Center for Public Integrity and NPR investigation into the drug industry’s influence on such boards. The state is one of the latest to respond to the findings of the Medicaid, Under the Influence project. Officials in Arizona, Colorado and New York have already taken action. The Texas committee, which helps decide which medicines are best for patients and should therefore be preferred by Medicaid, will now ask speakers to disclose verbally and in writing if they have “directly or indirectly received payments or gifts” from any pharmaceutical companies and to identify those firms, Texas Health and Human Services Commission spokeswoman Kelli Weldon said in an email. The changes come in response to the July investigation that detailed, among other things, how doctors who came before the Texas committee praised drugs without acknowledging their financial ties to the drugmakers that market them. One physician did not disclose more than $181,000 he had been paid to speak about certain drugs that he then recommended to the committee…


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Article 3:   

3 things you need to know about drug pricing to understand this week’s Medicaid changes, Katie Weddel, Dayton Daily News, August 16, 2018

Correcting an injustice: HHS moves to stop unions from skimming from Medicaid, Chantal Lovell  & Vincent Vernuccio, Washington Examiner,  August 07, 2018

Clay’s summary: Ohio got tired of all the reports showing them paying stupid money to CVS.

Key Passage from the Article


The change was announced as Auditor of State Dave Yost prepared to release a report, out today, that shows PBMs charged Ohio a 31 percent markup on some drugs or more than $224.8 million in a one-year period through a controversial “spread” pricing model. This news can be difficult to understand if you don’t know how Medicaid prescription benefits currently work. The Dayton Daily News has been covering the complex system of drug pricing and efforts to make it more transparent for more than a year. 

1. What is a PBM?

Pharmacy benefit managers — or PBMs — are the middlemen between the pharmacy and your health plan and they have influence on many aspects of the consumer prescription experience. They determine which drugs are covered or excluded by health plans, which pharmacies patients can use, and play a major role in determining the price everyone along the supply chain will pay.

Health plan sponsors have been contracting with pharmacy benefit managers since the 1970s to run their prescription benefits. They started out as just claims processors, but now wield much more power…

Read it here