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Office of Program Policy Analysis and Government Accountability

Inflated Pricing and Confidential Information Prevent Medicaid from Ensuring Lowest Prescription Drug Prices, Report No. 06-07, January 2006
Full report in PDF format

  • Medicaid prescription drug expenditures, which were $2.5 billion in Fiscal Year 2004-05, have nearly doubled since Fiscal Year 2000-01, growing an average of 15.1% per year.  Legislative actions have helped to slow the growth rate of these expenditures, which rose at an average rate of 21.2% annually during the previous five-year period (Fiscal Years 1995-96 to 1999-00).  Much of this slowed growth has been the result of specific cost-containment actions directed at lowering the price that Medicaid pays for drugs. 
  • However, the state’s ability to obtain the lowest possible prices for prescription drugs is hindered by inflated manufacturer pricing information and lack of access to confidential information.  The Legislature should consider requiring pharmaceutical manufacturers to submit more accurate pricing information to the Agency for Health Care Administration (AHCA) as well as requiring AHCA to strengthen cost-containment strategies to achieve lower prescription drug prices.

Which Government Program Summaries contain related information?

Medicaid Health Care Services
Agency for Health Care Administration

What other OPPAGA-related materials are available?

  • Report No. 07-08 Legislature Could Consider Options to Address Pharmacy Benefit Manager Business Practices, published in February 2007.
  • Report No. 04-53 Progress Report: Medicaid Should Improve Cost Reduction Reporting and Monitoring of Health Processes and Outcomes, published in August 2004.
  • Report No. 03-27 Progress Report: Changes to Medicaid Preferred Drug List Requirements and Competitive Bidding Pharmacy Contracts Could Save an Additional $86.6 Million in 2003-04, published in April 2003.
  • Report No. 01-10  Justification Review: Growth in Medicaid Prescription Drug Costs Indicates Additional Prudent Purchasing Practices Are Needed, published in February 2001.

Copies of this report in print or alternate accessible format may be obtained by telephone (850/488-0021), by FAX (850/487-9213), in person, or by mail (OPPAGA Report Production, Claude Pepper Building, Room 312, 111 W. Madison St., Tallahassee, FL 32399-1475).
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