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Investor Presentaiton

time period and added any dispensing fees. 32 We then took this total and subtracted it from PBM reported ingredient cost. A positive difference indicates the pharmacy likely made a profit, whereas a negative amount indicates the pharmacy likely had a loss on the claim. We did not verify the reimbursement amounts reported by PBMs to the pharmacies or the actual acquisition costs of the drugs by pharmacies. It is likely some pharmacies with larger buying power had lower acquisition costs than what was used in our calculations, and conversely some pharmacies likely had higher acquisition costs. We compared reimbursement amounts across PBMs and pharmacy types. Pharmacy types were divided into four different categories: independent, national chain, specialty/mail order, and other. The other category includes long-term care pharmacies and those housed in a health care setting. We also received aggregate information from each CCO and PBM for drug rebates and other payments received. We did not verify reported totals with outside entities. In September 2022 and February 2023, we sent letters to the Legislature, as seen in Appendix C. While this was not a real-time audit, we sent these letters to provide timely information to policymakers ahead of and during legislative sessions. Internal control review We determined that the following internal controls were relevant to our audit objective. 33 • . Risk Assessment We interviewed OHA management and staff to determine if risk areas were assessed. Control activities We considered whether management has designed control activities to ensure CCO and PBM compliance. Monitoring activities We considered whether management was effectively monitoring internal controls to ensure CCO and PBM compliance. Deficiencies with these internal controls were documented in the results section of this report. We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. We sincerely appreciate the courtesies and cooperation extended by officials and employees of OHA during the course of this audit. 32 Myers and Stauffer, an OHA contractor, collects and reviews drug acquisition cost data provided by pharmacies enrolled in the Medicaid FFS program. Cost information is collected via survey and rates are adjusted weekly. See the Myers and Stauffer website for posted rates. 33 Auditors relied on standards for internal controls from the U.S. Government Accountability Office, report GAO-14-704G. Oregon Secretary of State | Report 2023-25 | August 2023 page 34
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