By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works CollectiveHealth Works Collective
  • Health
    • Mental Health
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: Is Managed Care the Answer to Reduce Medicaid Drug Costs?
Share
Notification Show More
Font ResizerAa
Health Works CollectiveHealth Works Collective
Font ResizerAa
Search
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Business > Finance > Is Managed Care the Answer to Reduce Medicaid Drug Costs?
FinanceHealth ReformPolicy & LawPublic Health

Is Managed Care the Answer to Reduce Medicaid Drug Costs?

Linda Ringquist
Linda Ringquist
Share
5 Min Read
medicaid drug costs
SHARE

Summary: Healthcare costs are continuing to rise. Medicaid continues to expand. What is the best way to regulate medicaid drug costsprescription drug costs for the Medicaid community?

Summary: Healthcare costs are continuing to rise. Medicaid continues to expand. What is the best way to regulate medicaid drug costsprescription drug costs for the Medicaid community?

Medicaid is a social service program that provides health insurance to children  and certain needy families and individuals. Medicaid covers certain impoverished families and children who meet strict eligibility requirements.

In 2010, the Patient Protection Affordable Care Act (PPACA) was implemented with provision effective dates extending through 2014. Part of the PPACA is specific to Medicaid and the expansion thereof. Originally, it was proposed to mandate that all states would begin efforts to expand Medicaid in an effort to cover more individuals. Since the initial proposal, a compromise was struck which permitted individual states to either go ahead with expansion or to opt out. The carrot dangled to entice states to participate was that of additional federal funding which would be 100% for the first 3 years and then to scale back progressively.

More Read

What Does Medicare Cost in 2022?
Obesity by Country
Diagnostic Reading #33: Five Must-Read Articles from the Past Week
Breaking News: Supreme Court Upholds ACA
Top 8 ACA Delays: Blatantly Illegal or Temporary Courses of Action?

medicaid expansionExpansion of Medicaid is accomplished through managed care. Managed care is an approach to healthcare designed to simplify and expedite services while providing quality and cost-effective healthcare. Managed care plans typically cover some or all of the costs of obtaining healthcare services.  Members of such plans are usually encouraged to utilize approved providers within a particular network.  Managed care plans include utilization review mechanisms to track the types and quantities of services obtained by its members. Provider reimbursement methods are another primary important segment of managed care plans.  These methods are used to encourage healthcare services that are deemed  medically necessary and discourage the use of those deemed unnecessary.

Many times we think of managed care as it pertains to services of care. However, pharmacy is becoming a key component in the overall managed care arena. The state contracts out its pharmaceutical services to a group that agrees to provide services at a lower cost. Managed care system gets paid the more money they save. Managed care can benefit the patient by reducing the number of opportunities for drug duplication. As with most aspects of healthcare, there is a legitimate concern as to how to apply to behavioral health patients.

The cost of prescription drugs for the Medicaid community are rising at rapid rates along with healthcare costs in general. Currently,managed care states vary greatly in what is charged/reimbursed for prescription drug costs. Some states are beginning to roll in prescription drugs into managed care, forming networks similar to traditional HMOs. Competition is beginning to take place between pharmaceutical manufacturers, pharmacy benefit managers and both physical and mail-order pharmacies.

One of the confusing things about Medicaid is that it is under the control of the individual states. Each state has the ability to administer how they see fit within certain parameters. With this being said, different states have different eligibility requirements as well as funding/reimbursement attributes. Examples of this disparity include: one state is $11 per prescription to dispense Medicaid drugs with lower ingredient fees while other states are closer to $2 in dispensing fees with increased costs for ingredients. The big dilemma is trying to achieve some sort of regulation to encourage a level playing field, so to speak. Federal legislation has been proposed but as yet not been approved. Once approved, there is growing concern about not if reimbursement will be cut but by how much.

States have tried to be creative in curbing Medicaid drug costs by instituting preferred drug lists, requiring pre-authorization, requiring manufacture discounts and negotiating rebates and joint-buying programs on a multi-state level. While some of these have been successful, there doesn’t appear to be on solid answer to achieve best practices status.

Will managed care be successful in regard to Medicaid drug costs? Only time will tell.

TAGGED:managed careMedicaid
Share This Article
Facebook Copy Link Print
Share

Stay Connected

1.5kFollowersLike
4.5kFollowersFollow
2.8kFollowersPin
136kSubscribersSubscribe

Latest News

a woman walking on the hallway
6 Easy Healthcare Ways to Sit Less and Move More Every Day
Health
September 9, 2025
Clinical Expertise
Healthcare at a Crossroads: Why Leadership Matters More Than Ever
Global Healthcare
September 9, 2025
travel nurse in north carolina
Balancing Speed and Scope: Choosing the Nursing Degree That Fits Your Goals
Nursing
September 1, 2025
intimacy
How to Keep Intimacy Comfortable as You Age
Relationship and Lifestyle Senior Care
September 1, 2025

You Might also Like

Should the US Destroy its Cache of Smallpox Virus?

February 17, 2011
obamacare implementation
BusinessHealth ReformPolicy & LawPublic Health

Making Sense of the Technical Difficulties in ObamaCare Implementation

October 9, 2013
Hospital Digital Marketing, Online Marketing, Medical Marketing
BusinesseHealthFinance

5 Reasons Hospital Marketing Will Benefit by Devising Digital Plans

March 12, 2014
BusinessFinanceHealth care

Sustainable Finance Strategies for Healthcare Businesses

April 16, 2024
Subscribe
Subscribe to our newsletter to get our newest articles instantly!
Follow US
© 2008-2025 HealthWorks Collective. All Rights Reserved.
  • About
  • Contact
  • Privacy
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?