Value of a PBM in Medicaid Managed Care

Sep 23, 2013
Pharmacy Benefit Managers bring value to Medicaid programs through solutions that improve outcomes and reduce costs.
  • Medicaid

State budgets are under immense pressure with impending Medicaid expansion and the rising cost of health care, resulting in a great number of challenges for states. Medicaid is a huge state expense, consuming up to 20% to 25% of state budgets. In many states, Medicaid spend surpasses education as the single biggest investment and expense.

In an effort to create a sustainable Medicaid benefit that improves the quality of care while managing costs, states increasingly are moving to managed Medicaid programs. Today, 26 states are using or considering a managed Medicaid model, and half of all Medicaid recipients are receiving some form of managed care. By 2020, that number will rise to 85%.

Managed Medicaid Benefits

A critical driver for states to move toward managed Medicaid is a provision in the Affordable Care Act that allows for the expansion of drug rebates to managed care claims. This eliminates financial barriers of moving the pharmacy benefit to a managed care model and opens new possibilities in Medicaid as managed care plans can apply best practices from their commercial populations to Medicaid members.

Industry experts agree that using a managed care model can bring innovation and improved quality of care. For instance, at the Medicaid Managed Care Congress earlier this year, speakers from CMS, states and managed care plans alike shared a common view of the importance of treating the “whole person” – not just the member’s disease state.

In one compelling example, a plan provided window-box air conditioners to patients with asthma to help them reduce the effect of environmental factors triggering asthma complications. This was an effort to improve member health and help to avoid the need for costly treatments, including ER visits. While an atypical example, providing air conditioners is emblematic of “big idea” creative thinking that is needed to not only address the country’s $50 billion asthma problem but also, over time, help the states solve some of their biggest Medicaid budget challenges.

Integrated Care = Quality and Reduced Costs

With the increasing use of managed care comes a focus on the value of better integrated medical, behavioral health and long-term care. This is a step in the right direction, but Medicaid plans are still missing a significant opportunity to help managed states achieve cost savings and quality goals. Through meaningful pharmacy benefit management solutions, members and providers can make clinically appropriate and cost-effective drug, health and pharmacy choices.

The Express Scripts strategic approach to benefit management complements the focus on integrated care coordination, quality initiatives and cost-management efforts. 

Pharmacy benefit management capabilities

For example, through proprietary predictive modeling, we can proactively identify Medicaid members at risk for nonadherence and provide tailored interventions before that nonadherence drives expensive medical issues. We leverage vast amounts of proprietary pharmacy data and apply advanced analytics to make it actionable. The net result is that we are in an unparalleled position to monitor Medicaid members for gaps in care or unsafe use of medication and take immediate action to correct the problem.

We also develop custom programs reflecting unique Medicaid cost-savings needs. For Medicaid patients with chronic and complex conditions requiring maintenance or specialty medications – the costliest component of a state’s pharmacy expenditures – we provide specialty pharmacy services matching the needs of the patient with a specialist pharmacist uniquely trained and focused on their specific drug therapy needs.

Within our Therapeutic Resource Centers®, specialist pharmacy practices concentrate on specific diseases such as hepatitis C and other conditions more prevalent with Medicaid members.

Many states are moving in the right direction in helping their Medicaid members live healthier lives. Pharmacy is the most often used health benefit and provides the greatest opportunity to affect patient behavior, improve outcomes and reduce costs. State Medicaid programs looking for innovation, better care and value should look for a PBM.

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