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Pharmacy benefits are changing in many state Medicaid programs. Photo: Scott Olson/Getty Images

Michigan's Medicaid program is proposing to fire the pharmacy benefit managers that handle its prescription drug claims and negotiate prices. The state would manage drug coverage itself, starting Dec. 1.

The big picture: More state Medicaid agencies have determined that outsourcing all negotiations and operations of prescription drugs to PBMs has not produced the dramatic savings they were promised.

Details: Michigan officials said in a bulletin the state could extract bigger rebates from pharmaceutical companies and cut administrative costs if the state handled all Medicaid medication benefits, instead of the current private contractors.

  • Michigan would use Magellan as its sole drug claims processor.
  • A spokesperson for the Michigan Department of Health and Human Services said the proposal would save $40 million, and officials "will be reviewing the feedback carefully to determine next steps."
  • CVS Health, OptumRx, MedImpact and a handful of other PBMs stand to lose business.

Between the lines: State governments, along with pharmacists, continue to lead the crusades against PBMs.

  • A recently signed California regulation will shift all Medicaid drug benefits away from PBMs by 2021, and West Virginia's Medicaid department fired its PBMs in 2017.

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Updated 6 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: Hospital crisis deepens as holiday season nears.
  2. Vaccine: Moderna to file for FDA emergency use authorization โ€” Vaccinating rural America won't be easy โ€” Being last in the vaccine queue is young people's next big COVID test.
  3. Politics: Bipartisan group of senators seeks stimulus deal โ€” Chuck Grassley returns to Senate after recovering from COVID-19.
  4. Economy: Wall Street wonders how bad economy has to get for Congress to act.
  5. ๐ŸŽง Podcast: The state of play of the top vaccines.
Alayna Treene, author ofย Sneak Peek
2 hours ago - Politics & Policy

Bipartisan group of senators seeks coronavirus stimulus deal

Sens. Joe Manchin (D-W.V.) and Susan Collins (R-Maine). Photo: Drew Angerer/Getty Images

At least eight Republican and Democratic senators have formed an informal working group aimed at securing new coronavirus spending during the lame-duck session, a move favored by President-elect Biden, two sources familiar with the group tell Axios.

Why it matters: It may be the most significant bipartisan step toward COVID relief in months.

FCC chairman to depart in January

FCC Chairman Ajit Pai. Photo: Alex Wong/Getty Images

Ajit Pai will leave his post as chairman of the Federal Communications Commission on Jan. 20, the agency said today.

Why it matters: Pai's Inauguration Day departure is in keeping with agency tradition, and could set up the Biden administration with a 2-1 Democratic majority at the FCC if the Senate fails to confirm another Trump nominee during the lame-duck period.