New California Governor Orders Medi-Cal To Move Pharmacy To FFS Carve-Out Model

By 2021, the California Department of Health Care Services (DHCS) will move Medicaid pharmacy purchasing from managed care to state-administered fee-for-service (FFS). The shift is due to an executive order issued on January 7, 2019, by California’s new Governor, Gavin Newsom. The goals are to give the state greater leverage in negotiating with pharmaceutical companies, standardize the Medi-Cal pharmacy benefit statewide, improve pharmacy services, and to maintain quality and outcomes.

Under the order, by July 12, 2019, DHCS, the state Health and Human Services Agency, and the California Pharmaceutical Collaborative will review all state purchasing . . .