Interesting Trends Revealed in Medicaid Budget Survey in 50 States – Food, Drugs, Health Care, Life Sciences


United States: Interesting trends revealed in 50-state Medicaid budget survey

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The results of the KFF’s annual survey of state Medicaid directors reveal fascinating trends in service delivery and coverage of Medicaid benefits. Read on for a summary of the highlights that we find most notable.


As a preliminary matter, many of the trends identified by KFF and which we highlight below are undoubtedly the result of the Covid-19 pandemic. The pandemic has triggered a public health emergency and economic crisis that has resulted in increased Medicaid enrollments, service offerings, and flexibility in service delivery, as well as heightened awareness of disparities in healthcare. access to care and health outcomes.


Perhaps no health care trend is more indicative of the impact of the pandemic on services than the rapid and meteoric rise of services delivered through telehealth. Although the state’s Medicaid programs were moving towards reimbursement for services provided through telehealth before the pandemic, coverage and reimbursement policies were varied and slow to progress. The onset of the pandemic has resulted in a greatly increased need for health services, as well as a safe environment in which to receive services. To meet these demands, state Medicaid agencies have used emergency authorities to expand telehealth coverage, including expanding the range of services that can be provided through telehealth; establish reimbursement parity with face-to-face visits; allow various telehealth modalities (eg, audio-only telephone communication); and increase the types of providers that can be reimbursed for telehealth services. The wild popularity – and efficiency – of telehealth services has led many state Medicaid agencies to commit to retaining new flexibilities, which are good for both patients and providers.

Forty-six states responded to the KFF survey. Almost all responding states (41 states) currently allow coverage of services provided using audiovisual Wheretelehealth audio only. Five states allow the provision of services via audiovisual coverage, but not audio only. Supporters of reducing disparities in access to services argue for coverage of telehealth services by both audiovisual and audio-only modalities, in order to capture the greatest number of people, including those who have not. broadband access and those living in areas of the country with provider shortages.


Prescription drug spending accounts for about 10% of all health care spending in the United States. In addition, in 2017, the vast majority of prescription drug spending (82%) was incurred by private health insurance (42%), Medicaid (10%) and Medicare (30%), while only 14% were paid for by patients. -of pocket. The bottom line is that prescription drug spending is of great interest to payers, including state Medicaid agencies.

State Medicaid programs are challenged to control spending on prescription drugs, while ensuring that Medicaid-managed care plans do not get fat from the US drug pricing system. Structurally, many states administer their Medicaid pharmaceutical delivery through Managed Care Organizations (MCOs) and / or Pharmacy Benefit Managers (PBMs) who perform administrative and clinical functions for Medicaid pharmaceutical delivery.

Medicaid departments are also concerned with controlling the costs of drug benefits, and they use a variety of tactics to do so. For example, Medicaid agencies use Preferred Medication Lists (PDLs) to encourage providers to prescribe certain medications over others. This tool allows the Medicaid agency to manage drug use and force providers to prescribe lower cost drugs or drugs with an additional discount for the Medicaid agency. Additionally, many state Medicaid programs now integrate prescription drug benefits with managed care, as Medicaid agencies can now claim discounts on drugs provided through managed care organizations. Finally, states are increasingly using PBMs to help administer drug benefits and, more specifically, to administer cost-cutting tactics, including negotiating additional discounts and making informed decisions about PDL. PBMs are increasingly criticized for having reimbursed pharmacies much less than the PBM is reimbursed by MCOs and pocketed the difference or “spread”. In 2018, the Ohio State Auditor found that PBMs were costing the state’s Medicaid program almost $ 225 million through this practice of “pricing” in managed care. Ohio and other states are more intentionally reviewing their use of PBMs and imposing greater oversight on them.

Social determinants of health

Prior to the Covid-19 pandemic, state Medicaid agencies had started developing creative solutions to address the social determinants of health – factors such as socioeconomic status, education, neighborhood, and physical environment , access to health care and others – understanding that these considerations dramatically affect health outcomes. The pandemic itself has shown that health outcomes actually vary based on race and social determinants of health.

Although federal law prohibits Medicaid from paying for non-medical services, state Medicaid programs continue to develop opportunities to address the social determinants of health. One popular tool is to use contracts with Medicaid-managed care organizations to reach Medicaid recipients where they are. Some examples include beneficiary screening for behavioral health needs (31 states reported doing so in 2021), beneficiary screening for social service needs (24 states), referral to social services (28 states) and partnership with community organizations (27 states). In addition, about half of states are working with their MCOs to address health disparities with quality data and metrics. Eleven states target racial and ethnic disparities in maternal and child health, seven in behavioral health, six in Covid-19 results and / or vaccination rates, and eight in other areas including diabetes, asthma and oral health.


It is clear from information reported by KFF that Medicaid programs are responding noticeably to the pandemic, and it is likely that some of these changes will affect healthcare for years to come.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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