Understanding the Move from Managed Care to FFS: History and Objectives

Understanding the Move from Managed Care to FFS: History and Objectives

In preparation for the Enacted New York State Budget for Fiscal Year (SFY) 2020-2021, the Medicaid Redesign Team (MRT) was tasked with creating cost-saving solutions for Medicaid, so the program could remain financially sustainable while continuing to provide necessary health care services for the more than 6 million New Yorkers who rely on them.

One of these MRT II initiatives was the transition of the Medicaid Pharmacy Benefit from Managed Care (MC) to Fee for Service (FFS), beginning April 1, 2023. The transition of pharmacy benefits from Managed Care to FFS applies to 5.3 million Medicaid members enrolled in Mainstream Managed Care (MC) Plans, Health and Recovery Plans (HARPs) and HIV-Special Needs Plans (HIV-SNPs). Managed Long Term Care plans (e.g., PACE, MAP, MLTC) and the Essential Plan are not included.

Transitioning pharmacy services from MC to FFS will, among other things:

• Provide the State with full visibility of prescription drug costs.
• Strengthen the State’s negotiation power.
• Provide a single drug formulary, or list of covered medicines, with consistent rules and regulations.
• Address the growth of the 340B program and associated reductions in State rebate revenue.

This change will not change the scope (i.e. copayments, covered drugs/supplies) of the existing Medicaid Pharmacy benefit. scope (i.e., copayments, covered drugs/supplies) of the existing Medicaid Pharmacy benefit. The State is working closely with the MC, HARP, and SNP plans to ensure Medicaid members are provided with continued access to the medications and supplies they need with minimal impact or any disruption.