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HomeMorris CountyDeCroce Bill Tackling Medicaid Costs, Prescription Prices Clears Committee

DeCroce Bill Tackling Medicaid Costs, Prescription Prices Clears Committee

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MORRIS COUNTY — Greater financial transparency is needed to lower Medicaid costs for taxpayers and prescription drug prices for beneficiaries says Assemblywoman BettyLou DeCroce.

A bill she sponsors requiring pharmacy benefit managers working within the Medicaid program to disclose certain financial information to the N.J. Department of Human Services was cleared by an Assembly committee Monday.

Under the bill (A1259/S249), a pharmacy benefits manager providing services within the Medicaid program would be required to disclose all sources and amounts of income, payments, and financial benefits received on behalf of a managed care organization (also known as a health plan), ingredient costs and dispensing fees or similar payments made to pharmacies, and administrative fees.

“By properly monitoring pharmacy benefit managers’ profits, their payment models and use of spread pricing, New Jersey will be better equipped to put a stop to practices that are costing taxpayers and Medicaid beneficiaries,” DeCroce (R-Morris) said.

Spread pricing occurs when pharmacy benefit managers keep a portion of the amount paid to them by the health plans for prescription drugs instead of passing the full payments on to pharmacies. Studies in other states have estimated that prohibiting spread pricing could save Medicaid programs up to $43 million annually.

“Everyone is negatively affected as the prices of prescription drugs rise. For our lower-income residents who forgo important medications to pay the bills to our taxpayers who are suffering under increased state spending, it’s time we reign in these runaway costs,” DeCroce said.

Data from the Centers for Medicare and Medicaid Services show that from 2013 to 2017, average state and federal Medicaid spending on prescription drugs increased by more than 14.8% annually. Average Medicaid prescription drug spending as a percentage of state budgets has increased by more than 89% over the past 10 years.

The bill passed the Senate unanimously in February 2020.

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Frank Cahill
Frank Cahillhttps://www.frankcahill.com
Publisher of Parsippany Focus since 1989 and Morris Focus since January 1, 2019, both covering a wide range of events. Mr. Cahill serves as the Executive Board Member of the Parsippany Area Chamber of Commerce, Lt. Governor of Division 9 Kiwanis Club of NJ, and Chairman of the Parsippany-Troy Hills Economic Development Advisory Board. Owner of the Morris now app serving small business in Morris County.
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