{"id":973,"date":"2023-04-06T09:33:55","date_gmt":"2023-04-06T09:33:55","guid":{"rendered":"https:\/\/healthynewsusa.com\/?p=973"},"modified":"2023-04-06T09:33:59","modified_gmt":"2023-04-06T09:33:59","slug":"gov-newsom-wanted-california-to-cut-ties-with-walgreens-then-federal-law-got-in-the-way","status":"publish","type":"post","link":"https:\/\/healthynewsusa.com\/?p=973","title":{"rendered":"Gov. Newsom Wanted California to Cut Ties With Walgreens. Then Federal Law Got in the Way."},"content":{"rendered":"

\n

SACRAMENTO, Calif. \u2014 Gov. Gavin Newsom declared last month that California was \u201cdone\u201d doing business with Walgreens<\/a> after the pharmacy chain said it would not distribute an abortion pill in 21 states where Republicans threatened legal action. Since then, KHN has learned that the Democratic governor must compromise on his hard-line tweet.<\/p>\n

California is legally bound to continue doing business with Walgreens through the state\u2019s massive Medicaid program, health law experts said. And according to a public records request, the state paid Walgreens $1.5 billion last year.<\/p>\n

Newsom\u2019s administration confirmed it will \u201ccontinue to comply\u201d with federal law by paying Walgreens through Medi-Cal, which provides health coverage to roughly 15 million residents with low incomes and disabilities. Were California to stop covering Medi-Cal prescriptions filled at Walgreens stores, legal scholars warned, the state would run afoul of federal law, which allows patients to get their medications at any approved pharmacy.<\/p>\n

\u201cCalifornia has no intention of taking any action that would violate federal Medicaid requirements, or that could undermine access for low-income individuals,\u201d said Tony Cava, a spokesperson for the California Department of Health Care Services, in a statement.<\/p>\n

Newsom spokesperson Anthony York said, \u201cTweeting is not policy.\u201d He added the governor will not \u201ctake any action that hurts people who need access to care.\u201d Walgreens has even been reinvited to apply for a specialty drug contract that Newsom pulled back on renewing<\/a> last month, York said. Walgreens has received about $54 million from the state under the contract.<\/p>\n

The dust-up with the Illinois-based pharmacy chain illustrates Newsom\u2019s panache for sweeping announcements on social media, where he garners national headlines but offers few specifics and little follow-through, political strategists said. Newsom has raised his national profile \u2014 and speculation of a presidential bid \u2014 by traveling to red states and launching a new political action committee<\/a>.<\/p>\n

\u201cIt\u2019s much more about appearances and style and approach than it is about substance,\u201d said David McCuan, political science department chair at Sonoma State University. Newsom and his administration \u201coversell their pronouncements and don\u2019t actually deliver.\u201d<\/p>\n

On March 6, the governor tweeted \u201cCalifornia won\u2019t be doing business with @walgreens \u2014 or any company that cowers to the extremists and puts women\u2019s lives at risk,\u201d after the second-largest U.S. pharmacy chain said it would not dispense mifepristone in states where it is illegal to dispense the pill or where the company faced potential lawsuits if it did so.<\/p>\n

Democratic strategist Steve Maviglio said continuing to pay Walgreens through Medi-Cal doesn\u2019t take away from Newsom\u2019s support of abortion rights.<\/p>\n

\u201cHe\u2019s going to get the headline for protecting abortion rights, and this he can chalk up to a technical difficulty,\u201d Maviglio said. \u201cHe will be rewarded for standing up to a corporation.\u201d<\/p>\n

Federal law is designed to ensure Medicaid patients have choices in where they get health care, including prescriptions. Approved providers like Walgreens are protected by Medicaid statute<\/a>, which states that no health plan or entity can \u201crestrict the choice of the qualified person from whom the individual may receive services.\u201d Legal and Medicaid experts said that makes it extremely difficult for the Newsom administration to disqualify Walgreens.<\/p>\n

\u201cAs long as Walgreens is performing for Medicaid beneficiaries as it should, dispensing all legal drugs in a manner that is consistent with permissible pharmacy practice, then I don\u2019t see the basis for excluding them,\u201d said Sara Rosenbaum, a professor of health law and policy at George Washington University.<\/p>\n

The federal regulations<\/a> that protect Walgreens are the same that have allowed Planned Parenthood to offer health care services to Medicaid enrollees in conservative states, where leaders have sought unsuccessfully to exclude the network of clinics from receiving taxpayer funding.<\/p>\n

An approved pharmacy company can be excluded from state networks only if it has committed fraud or other contract violations, added Edwin Park, a research professor at Georgetown University with expertise in Medicaid law.<\/p>\n

\u201cCertainly, that wouldn\u2019t be the case for Walgreens,\u201d Park said.<\/p>\n

It\u2019s unclear whether Newsom was aware of how difficult it would be for California to unwind its Medi-Cal provider agreement with Walgreens, said Daniel Schnur, a Republican-turned-independent strategist who also teaches political science at the University of Southern California.<\/p>\n

\u201cThe original announcement sounded like a seminal step for the state of California to take on principle, even at great financial expense,\u201d Schnur said. \u201cThey\u2019ve quietly backed away.\u201d<\/p>\n

Through a records request, KHN learned the state paid Walgreens $1.5 billion last year to buy and dispense prescriptions to Medi-Cal enrollees. The bulk of the payment, $1.4 billion, reimbursed Walgreens for the prescriptions it distributed. And the remaining $123 million went to dispensing fees, a payment to pharmacists for each prescription they fill. The federal government covers at least half the state\u2019s payments, which are also offset by rebates from drug manufacturers.<\/p>\n

A Walgreens spokesperson declined to comment on its business with California, referring to the same statement it issued in March: \u201cProviding legally approved medications to patients is what pharmacies do, and is rooted in our commitment to the communities in which we operate.\u201d<\/p>\n

Walgreens said it plans to dispense mifepristone \u201cin any jurisdiction where it is legally permissible to do so.\u201d The company was responding to an FDA rule finalized in January that allows certified pharmacies<\/a> to dispense the abortion pill, which is the most common way people terminate pregnancies. Walgreens isn\u2019t proposing to limit abortion pill sales in California or other states where abortion is legal and pharmacies are allowed to dispense it.<\/p>\n

Democrats have urged pharmacy chains<\/a> to sell the abortion pill even as GOP attorneys general threaten legal action. But many, including Walmart, Costco, Albertsons, and Health Mart, have not waded into the fight. Only Rite Aid and CVS have said they plan to begin certification to dispense the pills.<\/p>\n

Had Newsom been able to sever Medi-Cal\u2019s relationship with Walgreens, he would have contradicted one of his signature health initiatives. When he took office in 2019, Newsom proposed the state take over prescription drug coverage for Medi-Cal patients, many of whom had been covered through managed-care plans.<\/p>\n

Part of Newsom\u2019s pitch: Patients could go to nearly any pharmacy<\/a> in California.<\/p>\n

This story was produced by KHN<\/a>, which publishes California Healthline<\/a>, an editorially independent service of the California Health Care Foundation<\/a>.<\/em><\/p>\n