Medicaid officials warn of high pharmacy costs from gene therapies and expanding GLP‑1 use
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Summary
Budget presenters told the Senate committee that new high-cost drugs — particularly one-time gene therapies and expanding clinical uses of GLP‑1 medicines — present a material cost risk not fully captured in the current fiscal estimate.
At the Senate Health & Welfare Committee meeting on March 20, Medicaid budget staff highlighted pharmacy as a significant area of uncertainty for next year's spending.
Presenters said the department's current estimate did not fully capture some emerging coverage pressures, including requests tied to sleep apnea and expanded indications for GLP‑1 medications. They also flagged the arrival of very high‑cost gene therapies — examples cited in the meeting included hemophilia therapies with per‑case prices in the millions — that can carry limited or uncertain rebate structures and additional non‑drug costs such as travel and inpatient care for administration.
The department said pharmacy pressures can first appear as case‑level expenditures and then emerge in utilization and PMPM figures over time; missing these early signals can cause later upward adjustments to the caseload/utilization line. Officials said they monitor PBM negotiations and national trends but acknowledged pricing and rebate arrangements for some novel therapies remain a negotiation and forecasting challenge.
Ending: Senators and staff asked for ongoing updates as new coverage requests and utilization patterns emerge, so the budget office can incorporate pharmacy trends into quarterly PMPM monitoring.
