State delves into managed care again

Gov. Mike Dewine has directed state Medicaid officials to seek new contracts for Ohio’s troubled managedcare setup. The stakes are huge: The five current managed-care organizations received a combined $15.4 billion last year from the state, reporter Cathy Candisky learned.

And it was a disaster seven years ago, the last time the state undertook a revamp.

The 2012 ruckus started after the state dumped two of the five companies awarded preliminary contracts, Aetna and Meridian Health Plan, and replaced them with two others that had protested they had been shut out of the work, Buckeye Community Health Plan and Molina Healthcare. Shortly after the protest, Molina hired two lobbyists tight with then-gov. John Kasich: Robert Klaffky and Doug Preisse, chairman of the Franklin County Republican Party.

That led to court action and charges of illegal lobbying. Eventually, the lawsuit was dismissed, and Molina and Buckeye are still handling managed care for the state today.

When The Dispatch asked Molina lobbyist Dean Fadel seven years ago if the two Kasich buddies were hired in part because of their longchronicled history with the governor, the lobbyist said: “For sure.”

“If you’re going to hire someone, you’re going to look at their political affiliation,” Fadel said. “That’s part of the equation, unfortunately.”

PBMS in crosshairs

From the nation’s capital to the roadsides of New York, the once little-known pharmacy benefit managers — aka PBMS — increasingly are being spotlighted for their key role in prescription drug costs.

“President Trump has exposed the dirty secret of drug pricing: There is a shadowy third player in the transaction between patients and their pharmacists: middlemen who have taken a big kickback from the drug manufacturer, which may or may not be reflected in patients’ out-of-pocket costs,” said Health and Human Services Director Alex Azar in a New York Post column. Those middlemen are PBMS.

In New York, social media showed a billboard carrying the message “Prescription drug middlemen stole $300 million from New York. Albany stop PBM theft now.” The highway missive came from Fixrx, a joint effort started in November by the New York City Pharmacists Society and the Pharmacists Society of the State of New York.

A study last month led by consultant Eric Pachman, who formerly ran a chain of drug stores mostly in southwestern Ohio, found that PBMS were making 32 percent more than they were paying selected pharmacies for generic drugs.

The New York group says on its fledgling website: “Independent pharmacies are under attack by abusive PBMS, but we’re sending a message to these pharmaceutical cartels: Your days are numbered.”

Part of the reason for the Dewine crackdown on Ohio’s Medicaid managed-care organizations stems from the fact that they’re the ones who hired the PBMS, which a state consultant found overcharged Ohio taxpayers as much as $180 million.

The Dewine difference

Dewine already has distinguished himself from Kasich by returning the State of the State address back to Ohio House chambers. The ceremony is set for noon on March 5.

After holding his initial address in the Statehouse, Kasich moved it around Ohio for the next seven years.

And on Friday, a Dewine spokesman told reporter Randy Ludlow that the new state CEO would break with another recent Kasich practice: Dewine will attend the National Governors Association annual winter meeting later this month in Washington, D.C.

Kasich hadn’t attended the gathering in years.

drowland@dispatch.com @darreldrowland