The Legislative Budget and Audit Committee of Alaska sought information and analyses with regard to other states’ experiences with Medicaid reform and expansion initiatives. This report describes opportunities for Medicaid savings and to reduce pharmacy costs. As well as recommendations for contracting, incorporating employment supports, improving and monitoring access to care, and reducing unnecessary emergency department utilization.
This August issue of the Five Slide Series challenges some “sacred cows” in health policy. The format is a bit unusual – we hope you enjoy reading it and that the content is useful.
This study examined 35 states and DC that used the Managed Care Organization (MCO) model in their Medicaid program and either included (carved-in) or excluded (carved-out) pharmacy benefits from coverage. The report found that carve-in states outperform carve-out states by a wide margin, saving Medicaid $2.06 billion in state and federal expenditures in 2014 alone.
Key findings of the report include:
Across 28 states using the carve-in model, the net cost per prescription was 14.6% lower than the average net cost per prescription in states not carving in pharmacy.
This 14.6% differential created a $2.06 billion net savings in state and federal expenditures in FFY2014 for states deploying the carve-in model.
The seven carve-out states had a 20% increase in net costs per prescription from FFY2011-FFY2014 — in stark contrast to the 1% increase in net costs per prescription experienced by the 6 states that recently switched from a carve-out to a carve-in model.
The seven carve-out states “missed” a total of $307 million in savings in FFY2014 which would have occurred had they used a carve-in model.
This edition of our Five Slide Series is Medicare-focused, policy-oriented, and qualitative and opinionated in nature. We report on the achievements the Medicaid program has made in the mandatory enrollment MCO model, and convey our thoughts on testing a similar approach in Medicare.
These slides are health policy focused, looking at areas where significant cost savings can/should occur, and identifying at a high level ways that these savings can best be redirected to improve overall health. Some of these concepts are relevant to current Sovaldi discussions, although the “value pricing” issue has much broader reach.
The Association for Community Affiliated Plans (ACAP) enlisted The Menges Group to prepare a report on the ways in which state Medicaid agencies have opted to regulate Medicaid MCO PDL content. Most states afford MCOs wide latitude in establishing their PDLs. Conversely, a few states require MCOs to use the statewide Medicaid fee-for-service PDL, and a few others have taken a middle ground regulatory position. The paper emphasizes that utilizing the lowest-cost, clinically effective medication is one of the most important avenues available to achieve Medicaid savings, and concludes that wide MCO latitude over PDL content is the most appropriate policy.
The 2013 SNP Alliance Advanced Practice and Profile Report is the sixth edition of SNP performance findings for members of the SNP Alliance. The SNP Alliance is a national leadership group of 30 organizations that collectively represent more than half of current national SNP enrollment. The Menges Group authored the 2013 report.