Utah’s Medicaid program contracts with four Accountable Care Organizations (ACOs) to coordinate care for most of the state’s Medicaid enrollees. This October 2024 report examines the fiscal and programmatic impacts that transitioning to a prescription drug carve-out model, where the pharmacy benefit would be managed under a single-payer system using the fee-for-service payment methodology, would have on Utah’s Medicaid program. Our key recommendations include preserving the current pharmacy carve-in model, piloting a hybrid Preferred Drug List that allows the Utah Department of Health and Human Services and the ACOs to jointly guide utilization towards the most cost-effective drugs for specified drug classes, and exploring potential revisions to supplemental rebates collection and capitation rates for the pharmacy benefit.