On April 6th, 2021, the New York legislature announced that it was delaying, for two years, a controversial policy that would require the New York Medicaid program to shift payment of most drugs from Medicaid Managed Care (MMC) to Fee-For-Service (FFS) reimbursement. In New York, claims submitted by providers that participate in the 340B Drug Pricing Program (340B Program) and paid under FFS are reimbursed at actual acquisition cost, whereas 340B Program claims paid under MMC are based on the Pharmacy’s contract with the MMC plan. The transition back to FFS will significantly reduce the savings these providers realize through the 340B Program and impact the ability of these providers to continue providing necessary programs and services to their communities.
Though the two-year delay was a big win for 340B-covered entities, New York Medicaid is now gearing up again to implement the change in April 2023. Medicaid is hosting webinars, stakeholder calls, and other educational programs to help providers prepare for the change. Various stakeholders, including safety net providers, community leaders, and local advocacy groups, continue to educate legislators about the serious fiscal and social burdens that the carve-out will cause if implemented. We recommend that New York Medicaid providers that participate in the 340B Program start preparing for the transition, even while they may continue to advocate for the withdrawal of the transition policy.
Should you have any questions regarding the above, please contact the Garfunkel Wild attorney with whom you regularly work, or contact us at [email protected].