CMS letter outlines Medicaid reimbursement

On February 11, federal Center for Medicaid and Medicare Services (CMS) sent a letter to state Medicaid directors providing additional guidance on how they can become compliant with the final AMP rule.

The letter outlines key changes that states need to address when determining their reimbursement methodologies.  States have until June 30, 2017, to submit a state plan amendment incorporating the rule that’s effective retroactively no later than April 1, 2017.

The final rule requires states to reimburse pharmacies based on the actual cost for pharmacies to acquire the drug (actual acquisition cost), as opposed to an estimated acquisition cost.  The CMS letter gave examples of how states can establish and actual acquisition cost (AAC) model of reimbursement.  For example, it could be based on a state survey of retail pharmacy providers’ pricing, a national survey or the wholesale acquisition cost.