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New Standards Add Pharmacies In Medicaid

Agency for Health Care Administration

To address “concerns and issues” with pharmacy networks, Medicaid officials have reduced maximum times and distances that patients can be forced to drive for prescriptions, members of the House Health Innovation Subcommittee were told Wednesday.
Beth Kidder, deputy secretary for Medicaid at the state Agency for Health Care Administration, said the move “significantly strengthened” new network-adequacy requirements, with managed-care plans needing to have pharmacies within 15 minutes, or 10-mile drives, of patients, regardless of whether the patients are in urban or rural areas.

“We feel like this is a good standard, and it's far superior to what we had before, and this is the standard we'll be sticking with unless we feel like it needs to be tightened,” Kidder told the House panel.

The move increased the number of pharmacies in all Medicaid managed-care plans. The plan Staywell increased by 1,464 the number of pharmacies in its network, and Molina Healthcare increased by 885 the number of pharmacies in its networks, a Kidder chart showed.

Responding to a question from subcommittee Chairwoman MaryLynn Magar, R-Tequesta, Kidder said the agency “really did not have a lot of complaints about pharmacy access prior to this.”

But she said the agency noticed an increase in the number of pharmacies that have signed contracts with the plans.

“A lot of pharmacies received contracts due to these new standards,” she told Magar.

In addition to making the distance and time changes, Kidder said the state also reviewed the distribution of large chain pharmacies in managed-care networks and the use of pharmacy benefit managers.

Kidder said five Florida large chains account for 62 percent of contracted pharmacists in the managed-care plan networks. Moreover, she said, 87 percent of “other” pharmacies — which she said included community pharmacies, independent pharmacies and other retailers — have contracts with Medicaid managed care plans.

She provided a slide that showed each of the 11 managed-care plan pharmacy networks and the distribution of pharmacies in their networks. Committee member Jason Fischer, R-Jacksonville, asked Kidder how it measured the pharmacies, by sales or by prescriptions. When she said the analysis was based on the numbers of pharmacies in network, Fischer asked if the data could be analyzed based on usage.

Kidder said the agency has the data but wasn't sure how much time it would take to compile it for Fischer.

Florida requires most Medicaid beneficiaries to enroll in managed care plans. The state has contracts with 11 plans to provide the care.

Medicaid HMOs also provide access to pharmaceutical benefits. But the plans are not in charge of preferred drug lists that classify the medications people can access. Those lists are developed by the state with the assistance of a committee of clinicians.

While they don't determine the preferred drugs lists, HMOs have control over the pharmacies that participate in their networks so long as the networks meet adequacy requirements.

Kidder said the plans can limit networks, but they still have to have adequate numbers of pharmacies so people can get services in a timely fashion.

Managed care plans can remove providers, including pharmacists, from their networks based on quality, credentialing or price. Normally, Kidder acknowledged, the agency isn't aware of providers getting dropped from networks, but she said the plans must provide written notice of the changes to beneficiaries and providers.

Shane Abbott, pharmacist and co-owner of DeFuniak Springs-based Prescription Place Pharmacy, said the distribution of pharmacies becomes an issue when a managed care plan has a closed or limited network.

“The numbers you saw today look good,” he said. “The problem becomes when you get into a limited or closed network.”

Referring to one of Kidder's slides, Abbott noted Humana's pharmacy networks are closed and, as a result, only 10 percent of its pharmacy network is comprised of “other” pharmacies.

Abbott fears that the use of pharmacy-benefit managers is squeezing the networks and limiting participation for smaller pharmacies and independent chains. There are eight pharmacy-benefit managers used by managed care plans, Kidder said.

Abbott said the Agency for Health Care Administration has “used every tool they have in the box to encourage these PBMs (pharmacy benefit managers) to open up networks to independent pharmacies” and asked the Legislature give the agency “more power and authority.”