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Value of Managed Care Organizations and Pharmacy Benefit Managers in Managing the Medicaid Prescription Drug Benefit

PCMA engaged The Menges Group to estimate the financial and programmatic value of managing the prescription drug benefit in the Medicaid managed care setting, comparing states that utilize MCOs – who contract with PBMs – for their prescription drug benefits to states that manage their prescription drug benefits in FFS. Using Medicaid prescription drug data reported by each state to the Centers for Medicare and Medicaid Services (CMS) for all Medicaid-paid pharmacy-dispensed prescriptions, we analyzed how prescription drug costs and usage vary depending on how prevalent managed care is in each state Medicaid program. We also analyzed the drug costs and usage within specific therapeutic drug classes.

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