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OIG: States concerned about validity of AMP data

Pharma Compliance Alert, May 9, 2007

Although CMS has been sending states monthly average manufacturer price (AMP) data since July, most states have not decided whether to use that data for Medicaid drug reimbursement. The OIG surveyed Medicaid pharmacy directors in all 50 states and the District of Columbia to find out whether they would use the data.

According to OIG, of the 47 states that completed the survey, 39 have not decided whether they will use the data. Among the other eight, four plan to use AMP data for Medicare reimbursement but haven't implemented the change, three will not use the data, and one is using AMP to help determine maximum allowable costs (MAC) for must drug products under its MAC program. Also, few states have decided whether to use retail sales price (RSP) data for Medicaid drug reimbursement.

The OIG survey found that the undecided states are unsure about the validity of the AMP data and want assurances from CMS that it's accurate.

According to the Deficit Reduction Act, CMS must set a regulation that clarifies AMP requirements by July 1. In the meantime, the OIG is calling on CMS to:

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