PA tries to cut drug costs

    Pennsylvania lawmakers are debating a pharmacy carveout.

    Pennsylvania’s Department of Public Welfare has said it can save millions by managing the prescription drug benefit for more Medicaid participants, but news from the Obama administration is forcing state officials to review that plan.

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    The federally-mandated discount that drugmakers give to Pennsylvania, and other states, is much higher than the discounts that managed care plans are typically able to negotiate.

    Margaret Murray lobbies for health plans that enroll Medicaid participants. She’s the CEO of the Association for Community Affiliated Plans.

    Murray: The president’s budget said that regardless of whether a Medicaid beneficiary has a card from a health plan or gets their care paid for directly by the state, that the manufacturer should pay the same rebate for those drugs.

    Murray says it’s the first time that the proposal to expand the discount to health plans has won support from a president.

    President Obama also wants to increase the mandatory rebate to 22 percent. Right now, pharamceutical companies give states a 15 percent discount on prescription drugs for people in the Medicaid program.

    This is the fourth time Pennsylvania has tried to cut costs by managing the Medicaid drug benefit.

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