The Joint Technology Committee voted to recommend the Department of Corrections (DOC) move forward with replacing an aging pharmacy software system, a request DOC described as a $0 supplemental (authorization to proceed using existing savings) but which the department said will require a future decision item for ongoing funding.

Ed Kaley, Director of Business Innovations for DOC, told the committee the current pharmacy environment relies on multiple legacy systems—some more than 30 years old—that are costly to maintain and fall short of state information-security and pharmacy-board requirements. Kaley said the department expects to dispense more than 400,000 prescriptions in fiscal year 2025 and that pharmacy staffing has not increased to match prescribing growth.

Kaley said a modern pharmacy system would create a single secure source of truth for pharmacy data, reduce reliance on local pharmacies by shortening prescription transfer times, enable billing for parole prescriptions through an 1115 Medicaid waiver mechanism and expand participation in the federal 340B drug-pricing program. Since beginning 340B participation earlier this year, DOC estimates it has saved more than $7 million on pharmacy costs, Kaley said.

On costs, Kaley said the new implementation will exceed $1 million with approximately $800,000 in ongoing annual costs. He said the department believes current-year cost savings will cover implementation costs but that ongoing support will require action by the Joint Budget Committee. Kaley said a previous vendor (identified earlier in the transcript as a boutique vendor) provided only a minimal estimate (about $50,000 annually) and ultimately could not meet pharmacy-board requirements during an earlier attempt.

Senators asked about data migration and security; Kaley said DOC has a dedicated data team experienced with offender records and works with OIT and vendors experienced in correctional pharmacy systems. Senators also asked about parole prescriptions; Kaley said DOC continues to provide an initial supply on release and that billing changes could help recover some of those costs.

Senator Marchman moved to approve the supplemental to permit DOC to proceed; Senator Bazely seconded. A roll call recorded unanimous approval. The committee asked DOC for quarterly updates on migration and vendor implementation.