Blister pack with dollars instead of pills  In 2018, supplemental rebate agreementsnegotiated by 46 states, combined with federal rebates, reducedprescription drug spending by more than 35 percent in those states.(Photo: Shutterstock)

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For those state policymakers who don't want to wait to seehow—or if—Washington will combat skyrocketing prescription drugprices, experts at the Center for American Progress have a fewrecommendations for states to act now to reducethe price tag within their own drug spending.

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"Prescription drug spending has been rising steadily across theUnited States since the late 1970s," the experts write. "Congressis considering multiple approaches at the federal level to reducedrug spending, but state policymakers can also act independently toaddress this issue in the interim."

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Related: States pass record number of laws to curb drugprices

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At the top of their list is negotiating supplemental Medicaidrebate agreements. Only four states—Hawaii, New Jersey, New Mexico,and South Dakota—have not negotiated supplemental rebateagreements, to their detriment: In 2018, SRAs negotiated by theother 46 states, combined with federal rebates, reducedprescription drug spending by more than 35 percent in thosestates.

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"If these states decide to pursue SRAs, they should firstrequire drug manufacturers to submit additional and more detailedpricing and clinical information," the experts write. "By requiringdetailed information about discounts and rebates, states will havea better understanding of the prices charged for specific products.States can leverage favorable PDL placement to ensure that drugmanufacturers provide this information and enter into SRAs."

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States should include in an SRA is an inflation adjustor similarto that included in the federal rebate agreement, to offsetmanufacturer price increases in the future, they recommend. Statesshould also consider enhancing drug utilization reviews. Whilestates are required to perform Medicaid drug utilization reviewsfor their fee-for-service drug benefit, this same requirement doesnot exist for physician-administered drugs or managed care drugbenefits.

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"By expanding and aligning DUR across the Medicaid program,states can help to ensure that these programs are operating asefficiently as possible," the experts write.

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States can join pools to coordinate purchasing for theirprograms. Three existing pools are the National Medicaid PoolingInitiative, the Top Dollar Program and the Sovereign States DrugConsortium.

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"Among the three pools, more than half of the countryparticipates in drug purchasing pooling for Medicaid," theywrite.

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Other policy suggestions include:

  • Establishing a common formulary across state programs
  • Consolidating procurement of pharmacy benefit managerservices
  • Negotiating rebates with PBMs
  • Implementing subscription-based purchasing
  • Establishing a prescription drug affordability reviewboard
  • Reference pricing drugs
  • Maximizing participation in the 340B Drug Pricing Program
  • Promoting the use of generics
  • Reducing the cost of physician-administered drugs
  • Importing drugs from Canada

"Patient outcomes must be a central component of any reforms toreduce prescription drug spending," the experts conclude. "If notimplemented carefully, some reforms have the potential to reducepatient access to necessary drugs or promote the prescription ofmedically inappropriate drugs in the name of reducing costs.Policymakers should carefully examine their states' currentlegislative framework surrounding prescription drugs and ensurethat policies are maximizing state savings."

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