The U.S. House of Representatives passed the large budget reconciliation bill early in the morning of May 22. It includes one of NCPA’s top priorities, Medicaid managed care payment reform, in two sections (44123 and 44124), banning spread pricing and helping create a fair and transparent pharmacy reimbursement system in all Medicaid managed care programs based on pass-through payments of NADAC plus your state’s Medicaid fee-for-service professional dispensing fee. These provisions mirror policies already adopted in several state Medicaid managed care programs and essentially reflect the Medicaid fee-for-service rate. It saves taxpayers nearly $3 billion.
Included in these sections are provisions:
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Prohibiting spread pricing and requiring a full pass-through in all Medicaid managed care programs.
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Requiring pharmacy reimbursements in all state Medicaid managed care programs to be at the rate of NADAC plus your state’s Medicaid fee-for-service professional dispensing fee.
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Limiting payments to PBMs to solely administrative fees.
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Mandating reporting to the National Average Drug Acquisition Cost survey by all retail community pharmacies participating in state Medicaid programs.
H.R. 1, the "One Big Beautiful Bill Act,” passed by a single-vote margin after over 20 hours of committee markup the day before and an all-night debate on the floor. The measure now goes to the Senate for consideration. The language addressing NADAC reporting can be found in section 44123 (p. 312) and would be implemented six months after enactment. The Medicaid spread pricing ban with fair reimbursement would be implemented 18 months after enactment and can be found in section 44124 (p. 324) of the legislation. A later section of the expansive bill also "delinks” PBM compensation from the price of a drug, instituting only bona fide service fees.
We will continue strongly advocating for our Medicaid priorities and will also keep fighting for Medicare Part D contract reform to be included in other legislation moving this year.
