Investor Presentaiton
Source: States' legislative websites
To illustrate the importance of capturing pricing information from PBMs, Figure 20 highlights how
reimbursement prices can vary dramatically. For Trulicity, a medication used for the treatment of type
2 diabetes, reimbursements resulted in estimated pharmacy losses of $58.82 per prescription to
estimated pharmacy profits of $53.29 per prescription.
Figure 20: Pharmacy reimbursement rates are inconsistent among PBMs in Medicaid
NDC
Estimated pharmacy
profit/loss
Drug
Month
PBM
Number
of units
Average Oregon
acquisition cost per unit
Prescription 1 Trulicity
Prescription 2 Trulicity
Prescription 3 Trulicity
Prescription 4 Trulicity 2143380 Apr-21
Prescription 5 Trulicity 2143380 Apr-21
2143380 Apr-21
PBM 1
2
$404.31
($58.82)
2143380
2143380 Apr-21
Apr-21
PBM 2
2
$404.31
($16.58)
PBM 3
2
$404.31
$9.57
PBM 4
2
$404.31
$19.50
PBM 5
2
$404.31
$53.29
Source: Auditor analysis of OHA and PBM 2021 claims data, NDC lists, and Oregon Average Acquisition Cost data
We analyzed CCO and PBM data for aggregate dispensing fees, administrative fees, drug rebates, and
other fees or payments received between 2017 and 2021. In aggregate, PBMs reported paying less in
dispensing fees to pharmacies than what CCOs reported paying to the same PBMs for dispensing fees,
for a difference of $612,000.
Drug rebate information was also analyzed but was not clear enough to make reasonable estimates and
rebate totals were less than our expectations. For example, aggregate drug rebates received in 2021
were reported to be about $7 million while CCOS reported spending over $700 million in pharmacy
benefits. Information was not confirmed with outside sources and there are likely other PBM revenue
sources we did not analyze. The difficulty with our analysis further provides evidence the system is
extremely complicated, and OHA does not have enough resources to reasonably determine whether
Medicaid PBMs are acting in the best interest of the program and patients under the current model.
States are switching PBM models to exert better control over Medicaid prescription drug
programs
Oregon's Medicaid program currently uses a multiple PBM model. All 16 CCOs have the choice to
contract with OPDP to administer pharmacy benefits, or the CCOs can choose to contract with their
own PBM. In this model, CCOS pay their PBMs from capitation payments received from OHA. PBMs are
typically responsible for paying and processing pharmacy claims, developing or supporting the CCO's
preferred drug list, negotiating with network pharmacies for lower price guarantees, and contracting
with drug manufacturers for drug rebates. This model has some tradeoffs.
Oregon Secretary of State | Report 2023-25 | August 2023 | page 25View entire presentation