Health Watched

One might think that a report entitled  Potential Federal and State-by-State Savings if Medicaid Pharmacy Programs Were Optimally Managed could contain useful information for cash-strapped states and the federal government.  When the report was released last month by author The Lewin Group, the consulting firm issued a press release stating that

States, Federal Government Could Save $30 Billion by Managing Medicaid Pharmacy Like Part D, Medicaid MCOs and Commercial Sector Programs.

But when the National Community Pharmacists Association reviewed the report, they found many reasons to be concerned both about  transparency  and COI issues with Lewin and the contents of the report itself.   NPCA’s Associate Director John Norton enumerated these problems in his recent blog post  entitled Lewin Group/PBMs’ Medicaid Pharmacy Report Misses the Mark; Recommendations Threaten Patient Health and Access.  Among the concerns highlighted  are:

• ….the Lewin Group’s website touts itself as an “independent” consultant for clients, including the PBMs’ trade group, which commissioned this study. In this instance, that independence claim is undermined by the fact that the Lewin Group is owned by United HealthCare, a health care conglomerate whose holdings include Prescription Solutions— a PBM that serves over 10 million people.
• PBMs have a record of questionable business practices, including in the states which they now purport to “save.”
• By law, Medicaid programs must get the manufacturer’s best price for a particular drug. PBMs simply cannot negotiate better prices for drugs than Medicaid. Moreover, PBMs are notorious for not adequately sharing rebates from manufacturers.
• The Lewin Group focuses on the savings that could be realized by moving a specific disability category—the blind and disabled—into managed care, citing the fact that this population experiences a high per-capita pharmacy cost. However, the Center for Health Care Strategies rejected this idea….
• PBMs would charge the states massive administrative costs as compared to existing state Medicaid programs, which are run more efficiently through fiscal intermediaries. This means that states would spend more money on bloated PBM middlemen rather than patient care.
• The study ignores the potential loss of jobs and tax revenues to the state by driving Medicaid prescription revenues to out-of-state PBMs;
• PBMs seek to also achieve massive savings by reducing access to prescription drugs and services provided by community pharmacies.

NPCA  issued its own analysis of the findings:  Lewin’s Medicaid Pharmacy Managed Care Report: Bought and Paid for by PBMs .

The Michigan Pharmacists Association also spoke out against the misleading report, debunking its claims that

$146 million, or 10 percent of total costs, could be saved over the next 10 years if Michigan moved more of its fee-for-service Medicaid recipients to managed care programs.

What’s been the response in your state to this report ?  Readers, please let me know.