The Centers for Medicare and Medicaid Services (CMS) approved Minnesota’s State Plan Amendment (SPA) for a Directed Pharmacy Payment Program (DPPP). The DPPP provides additional reimbursement of $4.50 per Medicaid prescription on top of the MCO contracted rate to eligible pharmacies in rural and underserved areas as a bridge until the Single PBM program legislated last year is implemented on Jan. 1, 2028.
Although this was delayed from the previously expected implementation date of Jan. 1, 2027, MCOs will still be required to pay pharmacies at or above the reimbursement floor of NADAC plus the state’s Medicaid professional dispensing fee of $11.55 per language passed this session in SF 4612.
DPPP-eligible pharmacies are those with 13 or fewer independently owned locations or are in HRSA-designated underserved geographic areas and not owned or affiliated with a PBM.
The Minnesota Independent Pharmacists are among the pharmacy stakeholders working with the Minnesota Department of Human Services on implementing the pay-outs, which will include claims dating back to Jan. 1, 2026 (previously expected to be Jan. 1, 2025). When the single PBM is implemented on Jan. 1, 2028, pharmacies will continue to be reimbursed with a floor of NADAC plus the Medicaid professional dispensing fee.
