Pa. Pharmacies Sue for Better Medicaid Money

Independent pharmacies in the Philadelphia area say they are being driven out of business by low reimbursements for Medicaid prescriptions, and have sued to force higher payments.

All Medicaid patients in the Philadelphia area are in HealthChoices, a state-administered managed care organization that contracts with four HMOs to provide services. In suits filed in state and federal courts, the pharmacies say that they have been forced to accept rock-bottom rates to fill prescriptions for Medicaid recipients and, partially as a result, nearly half of the region's 480 independent pharmacies that operated when HealthChoices began in 1997 have been shuttered.

The state claims it has no say in payment rates and that pharmacists decide whether to accept rates set by the HMOs.

This crisis has been building for more than a year, and it's not just independent pharmacies that say they are suffering. Last year, two of the area's three major drug-store chains, CVS and Eckerd, began turning away enrollees of three of the four Medicaid HMOs, citing low payments from Eagle Managed Care, which is the pharmacy benefit manager for the three HMOs. Interestingly, Eagle is owned by Rite Aid — the third major chain in the area. The fourth HealthChoices HMO contracts with PCS Health Systems for PBM services. Interestingly again, Rite Aid recently purchased PCS.

Career Opportunities

HAP, a subsidiary of Henry Ford Health System, is a nonprofit health plan providing coverage to individuals, companies and organizations. This executive develops strategies to meet membership and revenue targets through products, pricing, market segmentation and advertising.  Aligns business among Business Development, Commercial Sales, Medicare and Public Sector Programs and Product Development. Seeks to enhance and be responsible for business development and expansion through the development of an effective product portfolio, strong interpersonal relationships and service excellence.

Apply via email to or online at

Subscribe to Our Newsletters

Monthly table of contents

Be notified as each issue of Managed Care is available online.

Biweekly newsletter

Recent topics have included:

PTCommunity news

New drug approvals, clinical trials, drug management. Three times per week.