Department of General Services Could Reduce Medication Costs, Audit Says
The Department of General Services obtains lower prescription drug prices than the Department of Health Services and CalPERS but should negotiate for more rebates, according to a state audit, the Sacramento Bee reports. The Bureau of State Audits measured overall drug costs for the three agencies by comparing rebates, dispensing fees, copayments and third-party payments. The agencies together spent $5 billion on prescription drugs in fiscal year 2003-2004.
Chief Deputy State Auditor Steven Hendrickson said DGS -- which buys medicines for prison inmates, patients in mental institutions and some institutionalized youths -- paid more for some medications than the other state agencies. He said costs could be lowered by obtaining more rebates for bulk purchases from drug makers.
In addition, the audit encouraged DGS to renegotiate some purchasing contracts.
The audit compared the cost of 57 common prescription drugs paid by agencies in California, the United States and Canada. Canadian agencies obtained the lowest prices 58% of the time, with California agencies receiving the lowest prices 10% of the time (McIntosh, Sacramento Bee, 5/31). The audit is available online.