HHS takes aim at drug companies for an ‘abusive behavior’ in Medicaid

Top federal health officials are heralding new guidance they say will keep drug makers from taking advantage of a loophole in the Medicaid program’s complex payment structure for certain medicines.

The new policy, first laid out in a February law, will help states and the federal government save money when drug makers increase the price of their drugs faster than inflation. The Department of Health and Human Services detailed the complicated algebra related to the change in new letters to states and drug companies.

The goal, according to health secretary Alex Azar, is to stop drug makers from gaming the system.

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