NCPA: Ban Medicaid Spread Pricing in Infrastructure Package

NCPA July 28, 2021

ALEXANDRIA, Va. (July 28, 2021) – The National Community Pharmacists Association is urging legislators negotiating an infrastructure package to include language to prevent abusive pharmacy benefit manager spread pricing and related practices in Medicaid managed care, improve transparency, and reasonably reimburse pharmacies. Currently, PBMs can overbill Medicaid managed care programs, under-reimburse pharmacies for medications dispensed, and retain the difference, which is referred to as the “spread.” NCPA supports language that would ban spread pricing for purposes of claiming federal matching payments under Medicaid and require PBMs to reimburse pharmacies with an ingredient cost and a professional dispensing fee no less than the professional dispensing fee under the fee-for-service program.

In pushing negotiators to include this language as a pay-for, NCPA Senior Vice President of Government Affairs Karry La Violette emphasizes that multiple state Medicaid programs have indicated PBMs are using spread pricing as a way of overcharging taxpayers for their services, with Arkansas, Georgia, Kentucky, Louisiana, New York, Ohio, Pennsylvania and Virginia prohibiting spread pricing in their Medicaid managed care programs.

La Violette says, “Spread pricing is among the most egregious PBM practices contributing to higher drug costs. It shouldn’t be tolerated. NCPA strongly encourages negotiators to ban Medicaid managed care spread pricing and stop this abuse.”

NCPA has previously advocated for legislation to ban the use of spread pricing by PBMs and also applauded guidance from the Centers for Medicare & Medicaid Services to prohibit managed care organizations in Medicaid managed care programs from counting the spread toward medical costs in the medical loss ratio.


Founded in 1898, the National Community Pharmacists Association is the voice for the community pharmacist, representing over 21,000 pharmacies that employ approximately 250,000 individuals nationwide. Community pharmacies are rooted in the communities where they are located and are among America’s most accessible health care providers. To learn more, visit