Texas boosts R.Ph. Medicaid reimbursement

June 11, 2007

The Texas legislature passed a $153 billion budget that includes a higher Medicaid dispensing fee as well as stipulations to direct savings from the switch to average manufacturers price (AMP) to pharmacists. The bill, which has yet to be signed by Gov. Rick Perry, represents the most comprehensive approach yet taken by a state to deflect the expected impact of CMS' plan to use the AMP to determine pharmacy reimbursement.

The Texas legislature passed a $153 billion budget that includes a higher Medicaid dispensing fee as well as stipulations to direct savings from the switch to average manufacturers price (AMP) to pharmacists. The bill, which has yet to be signed by Gov. Rick Perry, represents the most comprehensive approach yet taken by a state to deflect the expected impact of CMS' plan to use the AMP to determine pharmacy reimbursement. According to a GAO study of CMS' draft version of the new rule, the switch would reimburse pharmacists on average 36% below their acquisition cost and is expected to save CMS more than $8 billion over five years. The Texas law boosts the current dispensing fee of $5.14 + 1.95% (inventory management factor) to at least $7.50, and it could go as high as $12.50, depending on the AMP savings. The plan must be submitted to CMS for approval.

To see more Hot off the Press news articles, click here.

To go to the Drug Topics homepage, click here.