By Pension and Benefits Editorial Staff
California Governor Gavin Newsom has signed an executive order that creates the nation’s biggest single-purchaser system for drugs and will allow all Californians – including private employers — to sit together at the bargaining table across from drug companies when negotiating prescription drug prices.
Currently, public and private purchasers of prescription drugs for Medi-Cal, California’s largest purchaser of pharmaceutical services, are fragmented, left to negotiate against drug companies alone.
Pursuant to Executive Order N-01-19, the negotiation for pricing and purchasing of prescription drugs under Medi-Cal will now be conducted by the Department of Health Care Services on behalf of all 13 million Medi-Cal beneficiaries, as opposed to only 2 million currently.
Further, the executive order directs state agencies to purchase prescription drugs together, as opposed to negotiating with drug companies one by one, and charts the path to enable all Californians, including private purchasers, to join forces with public purchasers.
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