5-Slide Series
Our October edition focuses on prescription drugs, tracking Medicaid’s nationwide unit price progression from 2013-2016 for each of the 25 NDCs generating the largest Medicaid expenditures. The average annual price increases across these 25 drugs was 10% (mean) and 8% (median), led by a more than doubling (133% overall increase) of the price of Epipen 2-Pak across the timeframe assessed.
5-Slide Series
This month’s edition investigates prescription drug spending in all 50 states across three major state health care payers: Medicaid, state employee health plans, and in state prisons. By comparing these expenditures to total health care spending and overall spending in each state, one gets a better idea of the relative extent of state spending on prescription drugs.
Publication
Over 90 percent of Louisiana’s Medicaid prescriptions are paid for by MCOs. The Louisiana Association of Health Plans engaged us to assess the impacts of a potential policy change to take the preferred drug list (PDL) content responsibility away from the Medicaid MCOs and shift it to a single state-administered and state-determined PDL. Our key finding is that this policy change would be costly to the State and its taxpayers – increasing overall annual Medicaid costs by $40 million and increasing annual State Fund expenditures by approximately $15 million. Our report provides evidence across dozens of states demonstrating that a focus on optimal management of Medicaid’s drug mix at the “front end” produces more favorable net costs than an approach that relies primarily on “back end” rebate maximization.
5-Slide Series
The February report pieces together different data on prescription volume by state – mostly through our staff’s tabulations – showing the distribution of each state’s total 2015 prescriptions between those paid by Medicaid, Medicare Part D, and all other payer sources combined. There was considerable variation in this percentage distribution in each state.
Publication
The Texas Association of Health Plans engaged The Menges Group to prepare an analysis of the impacts of switching from a statewide uniform Medicaid prescription formulary to a model that allows Medicaid MCOs flexibility to develop their own preferred drug lists (PDL). Currently, Medicaid MCOs in Texas must utilize a uniform formulary controlled by the state. In this report, we assessed a model in which Medicaid MCOs have the latitude to manage the covered mix of drugs through their own PDLs. We conducted this assessment using multiple analyses, including a cost per prescription analysis, therapeutic class analysis, and quantitative and qualitative survey of Texas MCOs. This approach is estimated to result in total annual Medicaid savings of $236 million and annual general revenue savings of nearly $100 million. For this reason, a policy change towards the PDL latitude model is recommended. In addition to the report, a presentation summarizing the findings can be found in the Executive Summary hyperlink.
5-Slide Series
This edition provides data on Medicaid prescription drug usage and costs and trends from 2013 to 2015. Each data table shows national totals and subtotals for three groups of states: non-expansion states, initial Medicaid expansion states (those implementing Medicaid expansion in January 2014), and subsequent expansion states. The tables show all Medicaid-paid pharmacy volume, including prescriptions paid by Medicaid MCOs and those paid in the Medicaid fee-for-service setting. Tables differentiate pre-rebate and post-rebate spending.
5-Slide Series
For the November edition of the Five Slide Series we tabluated the costs and usage of three prevalent Hepatitis C medications – Sovaldi, Harvoni, and Viekira Pak. These drugs have all been introduced within the last 2 years and have exploded in popularity over that span, despite the high prices they command. In this slide deck we look at these drugs on a state-by-state basis, as well as on the national level.
5-Slide Series
We tabulated the cost per prescription for FFY 2014 using a 100% sample of Medicaid-paid prescriptions in each state. Medicaid’s national average net (post-rebate) cost per prescription was $37 in 2014. Initial (pre-rebate) payments to pharmacies averaged $72 per prescription; rebates averaged $35 per prescription. Net costs per prescription at the state level ranged from a low of $24 in Rhode Island to a high of $60 in Connecticut.
5-Slide Series
The June 2015 edition summarizes a full report we prepared in April, sponsored by America’s Health Insurance Plans. We believe this report, “Comparison of Medicaid Pharmacy Costs and Usage in Carve-In Versus Carve-Out States,” compellingly demonstrates the cost-effectiveness of using the pharmacy carve-in model.
5-Slide Series
The May 2015 edition portrays the distribution of all Medicaid prescriptions by their unit cost corridor. These slides quantify the rapid growth in Medicaid prescriptions with a cost per prescription above $1,000. The high-cost medications in this corridor represented 1.3% of pre-rebate Medicaid pharmacy spending in 2005 but have increased to 28.4% of Medicaid pharmacy spending in 2013 and 32.6% of Medicaid pharmacy spending in 2014.
