Policy & Practice II--Medicaid Drug Use

Policy & Practice II--Medicaid Drug Use

The last Pharmacy Management Tip of the Week explored policy and practice; specifically, it discussed the difficulty patients have in navigating the health system and in Medicare beneficiaries selecting a Part D plan. This week’s Tip explores potential implications of an actual change in policy on medication use, specifically in the Medicaid program. Medicaid, like Medicare, is overseen by the Centers for Medicare & Medicaid Services (CMS). It is a program for qualified medically indigent patients. While overseen by CMS, each U.S. State has its own program that it administers under various CMS rules so as they can receive Federal funding using the Federal Medical Assistance Program (FMAP) percentage.

Florida’s government implemented a formulary for its statewide Medicaid managed care plan. Munshi et al conducted an analysis to determine the implications of this program change.1 They evaluated Florida Medicaid managed care (MMC) plan members matched on sociodemographic and health characteristics to their counterparts enrolled in a comparable MMC health plan in another state without a state-mandated formulary. The analysis of over 18,000 enrollees overall saw a decline in generics usage, while brand use increased for members in the Florida health plan. Drug costs, especially for brands, significantly increased for Florida health plan members. The increase in plan costs was 27% higher among Florida health plan members compared with control group members. The findings might be surprising, as the intention of the policy change was likely hoped to do just the opposite.

Pharmacists should be aware of policy changes by Federal and State governments as well as of those by major insurers of the patients they serve. Typically, when patient copayments rise, their consumption of prescription drugs decreases. More restrictive formularies could potentially result in patients forgoing medication therapy or facing greater barriers to optimal therapeutic regimens. That being said, studies have shown varying implications of policy changes. Pharmacists should determine how to help patients in light of policy changes. Pharmacy managers are responsible for ensuring that pharmacists and support staff understand how policy changes might affect patients and for determining how those policy changes affect the pharmacy’s bottom line, as well.

Additional information about Impact of Health Care Policy on Health Care Delivery can be found in Pharmacy Management: Essentials for All Practice Settings, 4e. If you or your institution subscribes to AccessPharmacy, use or create your MyAccess Profile to sign-in to Pharmacy Management: Essentials for All Practice Settings, 4e. If your institution does not provide access, ask your medical librarian about subscribing.

1Munshi KD, Mager D, Ward KM, Mischel B, Henderson RR. The effect of Florida Medicaid’s State-mandated formulary on prescription drug use and health plan costs in a Medicaid managed care plan. J Manag Care Spec Pharm. 2018;24:124-131.


Go to the profile of Shane Desselle
over 3 years ago

How can pharmacy managers help patients facing changes in their phsrmavy benefits plan?