Notes from NYSDOH Webinar on Planned Medicaid Pharmacy Benefit Transition to FFS

July 13, 2020

Summary of 7/13/20 NYSDOH Webinar on Medicaid Pharmacy Benefit Transition to FFS effective 4/1/21

This afternoon, Department of Health officials held a webinar to discuss plans to move the entire pharmacy benefit from Medicaid Managed Care (MMC) and back to Fee for Service (FFS).  This policy change was enacted as part of the final SFY 2020-21 State Budget.  The benefit was originally moved to MMC in 2011 and now will be shifted back effective 4/1/21.

During the call, Janet Zachary Elkind, Deputy Director, Division of Program Development and Management for NYSDOH OHIP discussed an overview of the project.  The carve out of MMC into FFS applies to all mainstream managed care plans including HARP and HIV-SNP plans.  It does not apply to the Essential Plan, Child Health Plus or to Managed Long Term Care plans like PACE, MAP, MLTC.  The scope of benefits is not expected to change in terms of which drugs are covered and copayment amounts.  They expect to have a single drug formulary with standardized utilization management protocols, similar to what is in place now under FFS.

The reason for this move is to provide the State with full visibility into prescription drug costs and with rising drug costs nationally, the state expects to leverage additional rebate dollars by centralizing and leveraging negotiating power.  The State also hopes to address the growth in the 340B program and associated reductions in State rebate revenue as a result.

Stakeholder ProcessSimilar to the process used by NYSDOH when they moved the pharmacy benefit to MMC in 2011, NYSDOH plans to have a robust stakeholder engagement process. 

This will include:

  • Monthly Stakeholder Meetings for all interested stakeholders to provide implementation updates
  • Twice Monthly Technical Workgroup Meetings to hold working sessions  with MMC plans and other technical/subject matter experts to address specific topics/issues related to the transition; First meeting to be held next week on 7/22
  • Three Meetings of a New 340B Advisory Group to discuss and provide non-binding recommendations regarding reimbursement of 340B claims to generate savings due October 1, 2020; Meetings will be held in August and September (see below section on Advisory Group)

NYSDOH has created a timeline for key deliverables including the above mentioned meetings, notice of a 1115 waiver amendment September 2020, changes to the model contract by October 2020, 340B related State Plan Amendment submitted December 2020, System Testing December 2020 and Go Live Date April 2021, among others.

340B Advisory Group

The Advisory Group consists of 8 representatives for FQHCs/clinics, 3 representatives for Disproportionate Share Hospitals (DSH), 3 community pharmacy representatives, and 4 MMC plan representatives.  Below is the list from a screenshot we took from the presentation.  Amir Bassiri, Chief of Staff to Medicaid Director is staff point for this Advisory Group.



The following are answers to questions posed after the presentation:

> NYSDOH will use the existing contractors to administer the FFS program once the pharmacy benefit is back in

> Medical specialty and all retail pharmacy drugs will be included

> NYSDOH will announce the scope of benefits that will be included following the initial technical discussions with MMC plans coming up

> NYSDOH does not intend to phase in the shift but rather have all go live 4/1/21

> NYSDOH will continue to use eMedNY and General Dynamics to process the pharmacy claims

> There will be no special drug review prior to making the shift, rather the DUR process and classes of drugs will be the same as what is in place just prior to 4/1/21

> The 340B review process will not include other stakeholder input and meetings will not be open to the public

> Medicaid reimbursement to pharmacies will be the same as it is now under FFS based on actual acquisition cost (NADAC/WAC plus $10.08 dispensing fee)

> 340B Advisory Group will discuss and recommend changes that apply to ALL 340B entities and outpatient drugs under MMC (not just hospitals)

> How transition will impact VBP arrangements and care management plans will be subjects for discussion of technical workgroup meetings every other week

> MMC plan data access needs will also be discussed during technical meetings

> Whether medical injectables is included will also be discussed at technical meetings> NYSDOH will release a scope of benefits document following further discussion, along with an all stakeholders FAQ document as they get closer

> When asked if there is a School Based Health Center (SBHC) on the 340B Advisory Group, Amir Bassiri answered that there are a number of hospital and clinics on the Advisory Groups that have SBHCs

> When asked more specifically what the 340B Advisory Group will look at, Amir Bassiri answered that there is some flexibility in the rules for how 340B drugs are reimbursed so that will be studied and may form the basis for recommendations by the group

> CoverMyMeds may still be used once transition occurs

> Anticipated savings from this transition is $87.5 million (state share) for SFY 2021-22 once effective 4/1/21 (savings from increased rebate dollars to state, 340B savings and other efficiencies by eliminating MMC plans/PBMs which all have margins in process now

For More Information

The slide deck from today’s webinar will be posted in the next day or so at the MRT 2 NYSDOH page

Questions should be sent to: with Rx Carve Out listed in Subject

Please let us know if you have any questions related to today’s NYSDOH webinar on the Pharmacy Benefit Transition to FFS.

Thank you.