Advocates push for compromise on Medicaid pharmacy carveout

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ALBANY, NY (WENY) — Monday, advocates traveled to Albany urging the governor and legislators to stop the carve-out of pharmacy benefits from NYRx, a Medicaid program.

“It’s a complete decimation of the healthcare system—a gutting of the healthcare system as it exists today in New York State. Lots of people will be affected, numerous programs,” said Dr. Archimedes Jao, MD, Medical Director for East New York Community Health Center of Housing Works.

The carve-out will essentially transition enrolled Medicaid members from Medicaid Managed Care plans to Fee-for-Service programs, which some lawmakers said is having an inadvertent impact on the revenue streams for 340B–a federal Medicaid program that allows Safety Net providers to get reimbursement for the prescription drugs they purchase.

Some advocates are worried this transition will negatively impact the Safety Net providers who give care to residents regardless of their ability to pay and ultimately have negative health impacts on New Yorkers.

“You can’t just play with people’s healthcare. There are people with HIV that now will be able to spread—those things are in place for a certain reason,” said Charles Morales, advocate with Housing Works.

The carve-out, originating in the legislature’s 2020 state budget delayed implementation for two years which expires April 1.

About two weeks ago, Senator Gustavo Rivera sponsored a bill introduced in the legislature to repeal the pharmacy carve-out. This bill is still in committee.

Some lawmakers said the pharmacy carve-out is a complex issue but this transition could ultimately help establish greater transparency from pharmacy benefit managers or PBMs.

“Over the last decade, PBMs and health plans to a degree have been able to operate using billions and billions of taxpayer’s dollars without any accountability when it comes to prescription drug benefit,” said Assembly Member John McDonald (D-Assembly District 108).


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