Ohio Department of Medicaid to abandon spread pricing model

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DAYTON, Ohio (WDTN) – According to a new report by Ohio Auditor David Yost, Ohio’s Pharmacy Benefit Managers charged the state a “spread” of more than 31 percent for generic drugs, nearly four times as much as previously reported.

The analysis shows $208 million in fees was collected on generic Medicaid prescriptions during a one-year period.

Earlier this week, the Ohio Department of Medicaid announced it was abandoning the controversial spread-pricing model and that changes would be made but the study essentially shows that state cannot verify if taxpayers are getting their money’s worth.

Dr. Marc Sweeney, Dean of the School of Pharmacy at Cedarville University, joined 2 NEWS to discuss this further.

The report raises questions about whether a reimbursement setup dominated by pharmacy giant CVS is driving smaller competitors out of business and reducing Medicaid recipients’ access to medicine.

“Basically what you have here is the PBM incentivizing people to utilize their pharmacies, and in some cases they’re utilizing state tax dollars and contracting to exclude patients from being able to utilize the pharmacy of their choice,” said Dr. Sweeney.

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