State strategies to address medicaid prescription spending: negotiated pricing vs price transparency

This research longitudinally examines the association between levels of state Medicaid prescription spending and the state strategies intended to constrain cost increases: the negotiated pricing strategy, as indicated by state rebate programs, and the price transparency strategy, as indicated by state operation of All-Payer Claims Databases. The findings demonstrate evidence that state Medicaid prescription spending is influenced by the negotiated pricing strategy, especially Managed Care Organization (MCO) rebates under the Patient Protection and Affordable Care Act, but not influenced by the price transparency strategy. State decisions for MCO rebates, such as carving prescription benefits into managed care benefits, were effective in containing levels of Medicaid prescription spending over time, while other single- and multi-state rebate programs were not. Based on these findings, state policymakers may consider utilizing the MCO rebate program to address increases in Medicaid prescription spending.

Reading the Fine Print: State Considerations for Medicaid Buy-In Plans

States that are pursuing Medicaid buy-in plans have considerable options in designing a plan to meet their goals. Buy-in plans will reflect key decisions on four major issues: 1) whether plans are sold on or off exchange, 2) whether plans are run by the state or a Medicaid Managed Care Organization, 3) who is eligible to purchase plans, and 4) which benefits and providers will be covered and at what payment rates. Our goal is to clarify the implications of these choices with respect to the goals and with respect to the tradeoffs each choice would involve.