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Minnesota sued by Rx groups over Medicaid reductions

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ALEXANDRIA, Va. — Pharmacy groups this week expanded their legal action over Medicaid cutbacks to a fourth state, Minnesota.

The National Association of Chain Drug Stores said Friday that it has joined with the National Community Pharmacists Association, the Minnesota Pharmacists Association, the Minnesota Retailers Association and a number of businesses in filing a federal lawsuit against Minnesota. The plaintiffs charge the state with making unlawful cuts in Medicaid that, in turn, threaten patient access to care and the quality of care.

NACDS announced the filing of similar suits against the states of California, New York and Washington on Tuesday.

As in the suits against those three states, the pharmacy groups allege that Minnesota violated federal and state laws by not acting to preserve pharmacy Medicaid reimbursement after reductions in published average wholesale prices (AWPs), a benchmark used to gauge drug costs. The reductions stem from legal settlements by First DataBank and Medi-Span, which lowered AWPs on September 26.

As a result, the groups say, pharmacies are being reimbursed below cost for Medicaid prescription drugs and may have to exit the program for financial reasons, cut hours and services, or close, which impacts Medicaid patient care and access.

"Pharmacies provide vital medications and services to Medicaid patients that improve and save lives and help prevent higher long-term health care costs," stated NACDS president and chief executive officer Steve Anderson. "Some private payers and some states already have taken action to adjust reimbursements appropriately, to maintain the quality and accessibility of pharmacy patient care and its benefits. Federal Medicaid law obligates the states, including Minnesota, to do the same."

Julie Johnson, executive vice president and CEO of the Minnesota Pharmacists Association, commented, "MPhA is deeply disappointed in the decision of the Department of Human Services to not exercise its authority and responsibility to assist pharmacies in what will be a devastating blow to their ability to provide services to their patients."

“The pharmacy members of the Minnesota Retailers Association have had a long and positive working relationship with the Department of Human Services. Our association joins this lawsuit not as a first option but as our only option," stated Bruce Anderson, president of the Minnesota Retailers Association.


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