The state Senate’s budget director wants the Department of Health to find ways to save money on Medicaid pharmaceutical spending before his committee makes spending recommendations next week.
Budget Director Kurt Schaefer says Medicaid growth will cost more than the state is projected to bring in, in revenue for fiscal year 2017. He said that would preclude increases in education, higher education,
In particular, he said Medicaid pharmaceutical spending has doubled over five years to $1.8-billion dollars. He’s told the Department to look for ways to cut that.
“Because if that doesn’t happen then we’re just simply going to have to make a decision on what we think we can afford,” Schaefer told MO Healthnet Director, Doctor Joe Parks during a Senate Budget Committee hearing Thursday.
“We’re going to make a determination of what this dollar amount is going to be and it’s not going to be 32-percent, and then you’re simply going to have to, by necessity, implement whatever you can under the dollars that you have,” said Schaefer.
Parks said the Department has been developing programs to look for cost savings. One would have a clinical pharmacist review the needs of Medicaid recipients who are on 12 or more medications, long-term, to see if they can be treated with fewer.
“We picked 12 because it seems like a workable number to start with. When that goes well, we’ll drop it to 11, we’ll drop it to 10, and we’ll work into it one level at a time,” said Parks. “We believe it will save around $8- to $10-million in the first year and $18- to $20-million in the second year.”
Parks told the committee Missouri and other states have seen drastic increases in the costs of generic drugs and multiple types of specialty drugs.
Schaefer told Parks he wants more suggestions for how spending can be cut by next week.
The Senate Budget Committee will continue next week proposing changes to the spending plan passed before the legislature’s spring break by the state House.