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Vorys Health Care Advisors

New Report Regarding Drug Purchasing in Ohio

Posted in Access, Drug Pricing, Health Care, Medicaid, Pharmaceuticals

A proposed initiated statute to change state prescription drug purchasing in Ohio would be difficult if not impossible to implement, according to a new report issued by Ohio public health policy experts.

The report, released today from Vorys Health Care Advisors (VHCA) and Health Management Associates (HMA), analyzes the proposed initiated statute to change state prescription drug purchasing in Ohio. The research team was led by VHCA President Maureen Corcoran and Barbara Coulter Edwards, Managing Principal with HMA, both well-known in the health care field with extensive experience in Medicaid.  The report includes data and information gathered from state agencies likely to be impacted by the proposal.  The independent analysis was commissioned by the Pharmaceutical Research and Manufacturers of America.

“There would be little to nothing to be gained under the Act,” said Corcoran. “Instead the state could see increased costs in administrative functions in an effort to comply, while at the same time losing valuable supplemental rebate arrangements currently in place with drug manufacturers.”

The proposed initiated statute seeks to prohibit the state from entering into contracts where the “net cost” of a prescription drug purchased by the state is more than the “lowest price paid” by the U.S. Department of Veterans Affairs (VA).

If adopted, the proposed statute would affect roughly 4 million Ohioans. In addition to Ohio Medicaid, the state retirement systems and certain programs operated by state departments, the report also describes potential negative impacts on entities outside of state government, e.g. state universities and community colleges, the RxOC purchasing collaborative, BestRx, and concerns about access to VA-administered drugs now available to military veterans.

The Act would not apply to the approximately seven million Ohioans who use private insurance or other coverage.

The report concludes that:

  • It is highly unlikely the proposed statute could be implemented.
  • It is highly likely the proposed statute would fail to achieve its purpose.
  • It is highly likely that pharmacy programs of entities outside of state government would be negatively impacted.
  • State agencies would need to take other extreme measures in an attempt to comply with the mandate, which could result in higher copays, decreased access to community pharmacies, or even limits on available drugs for impacted individuals.

Click here to download the full report.