Massachusetts’ push to implement a closed Medicaid formulary is reportedly unlikely to succeed over legal worries by the federal government, according to a Health Affairs blog post.
The state had requested via a waiver proposal that the Centers for Medicare and Medicaid Services allow it to adopt a closed formulary to give it more negotiating power with drugmakers to bring down costs.
However, the plan has drawn opposition from some who are concerned the state budgets would ultimately lead to access problems for beneficiaries. The state says it would be able to negotiate lower drug prices without threatening access.
According to the Health Affairs post, concerns over litigation are a stretch.
“CMS’s legal authority to grant the waiver is secure,” the authors write. “Under section 1115 of the Social Security Act, CMS can ‘waive compliance with any of the requirements’ of section 1902 of the Medicaid statute.”
One requirement in section 1902 mandates state Medicaid programs to cover all medically necessary drugs, therefore giving CMS the power to issue 1115 waivers.