In this session, staff presented on recent trends in Medicaid spending and rebates for prescription drugs between fiscal years (FY) 2018 to 2021. In FY 2021, Medicaid spent approximately $80.6 billion on outpatient prescription drug and collected $42.5 billion in rebates, bringing net drug spending to $38.1 billon. Net spending for outpatient prescription drugs accounted for about 5.3 percent of Medicaid benefit spending. This continues the trend since 2018 of large increases in net drug spending following several years of low growth. This spending increase may reflect a number of factors, including the introduction of new, high-cost specialty drugs.
Publicly available data on drug rebates are only available in aggregate at the state level. In 2021, Congress gave MACPAC access to the price benchmarks used to calculate Medicaid rebates and the actual rebate amounts for individual drugs. This new information helps the Commission to better understand the effect of drug rebates at a more granular level. This presentation represented the first time MACPAC has publicly released analyses using these data. These analyses included how rebates differ for brand and generic drugs, and the distribution of the rebates across the basic and inflationary rebate components.
