A useful reminder of what rebates are for medication lined underneath State Medicaid Agencies. ICER studies of their California, based mostly on a useful abstract from the Kaiser Family Foundation:
For model title medication, the [Medicaid] rebate is 23.1% of Average Manufacturer Price (AMP) or the distinction between AMP and “best price,” whichever is bigger. Certain pediatric and clotting medication have a decrease rebate quantity of 17.1%. Best worth is outlined because the lowest obtainable worth to any wholesaler, retailer, or supplier, excluding sure authorities applications, such because the well being program for veterans. AMP is outlined as the typical worth paid to drug producers by wholesalers and retail pharmacies. For generic medication, the rebate quantity is 13% of AMP, and there’s no finest worth provision
Like the Inflation Reduction Act, Medicaid additionally requires rebates if costs rise quicker than inflation. Plus there are supplemental rebates:
The rebate calculation additionally contains an extra inflationary part to account for rising drug costs over time. This rebate is calculated because the distinction between the drug’s present quarter AMP and its baseline AMP adjusted to the present interval by the Consumer Price Index for All Urban Consumers (CPI-U). In different phrases, if a drug’s worth will increase quicker than inflation, the producer has to rebate the distinction to Medicaid…
As of June 2019, 47 states and DC had supplemental rebate agreements in place.15 These supplemental rebates should not topic to one of the best worth ground. States usually use placement on a most well-liked drug checklist (PDL) as leverage to barter supplemental rebates with producers.
Beneficiary value sharing within the Medicaid program can be very restricted:
Federal guidelines restrict beneficiary cost-sharing to nominal quantities: as much as $4 for most well-liked medication and $8 for non-preferred medication, for people with incomes at or under 150% of the federal poverty degree (FPL) and barely larger for these with larger incomes
You can learn extra particulars right here.