EDS Teams With Government Agencies to Recoup Millions in Medicaid Drug Rebates

Organizations Earn National Honors for Reinventing Dispute Resolution Process

For Medicaid Drug Rebates



Apr 18, 2001, 01:00 ET from Electronic Data Systems Corporation

    PLANO, Texas, April 18 /PRNewswire/ -- When state Medicaid programs and
 drug manufacturers disagree, the financial cost runs into huge sums of lost
 money that can be used to support health care programs for those in need.  EDS
 (NYSE:   EDS) and several government agencies have introduced a new way of
 getting the sparring parties to the table and successfully negotiating more
 favorable outcomes.
     At issue are unresolved Medicaid drug rebate disagreements between state
 Medicaid programs and drug manufacturers, which cost taxpayers close to
 $2 billion nationally each year, according to federal data.  Federal law
 requires drug manufacturers to pay states a quarterly rebate based on units of
 drugs dispensed per manufacturer each quarter.  On one hand, Medicaid agencies
 have claimed they were not receiving all of the entitled rebate funds; on the
 other, manufacturers have withheld substantial amounts if the companies
 disagreed with or expressed uncertainty about the way the rebate sum was
 calculated.
     The solution comes courtesy of the Health Care Financing Administration
 (HCFA), which, along with EDS and several New England Medicaid agencies,
 developed alternative resolution techniques to help resolve drug rebate
 disputes.  Acting as facilitator, HCFA brings the parties together,
 establishes a positive climate, coaches pre- and post-meeting sessions,
 develops timelines to fulfill commitments and follows up with the parties to
 ensure successful resolution.
     As a result, longstanding disputes are being solved.  In New Hampshire
 alone, approximately $700,000 was recovered through the new dispute resolution
 process.  In Vermont, nearly $750,000 has been negotiated back to the state.
 A large portion of these funds had been in dispute for more than four years.
     "The key element of this program's success is the cooperative spirit of
 partnership which has been fostered through the program among the federal
 government, state governments, the pharmaceutical industry and private
 players, such as EDS," said Michael Keogh, director of HCFA's Dispute
 Resolution Program (DRP).  "Before the DRP, countless hours were spent
 gathering data which ultimately did not end in acceptable resolution for
 either party.  Since the onset of the program we have been able to negotiate
 and build relationships which have resulted in outstanding results for state
 Medicaid programs."
 
     Results Gaining Notice
     The HCFA, EDS and six New England Medicaid programs -- including EDS
 client agencies Connecticut, New Hampshire, Rhode Island and Vermont -- were
 honored earlier this year with the Hammer Award for reinventing the way these
 disputes are settled and millions are recouped.  The Hammer Award is given by
 the vice president of the United States to government entities for
 demonstrating innovative reinvention.
     The award-winning process has now been incorporated in HCFA's ongoing
 program activities.  As well, HCFA has published a "Best Practices" for
 dispute resolution, which outlines the process and can be used by other states
 and manufacturers.  In addition to the Hammer Award, the DRP is one of
 25 programs out of 1,600 nominees nationwide recognized in 1999 by the Council
 of Excellence in Government's prestigious "Innovations in American Government
 Award."
     "The New England states worked together as a team to discuss common issues
 in addition to individual state issues with the pharmaceutical manufacturers,"
 explained Paul Wallace-Brodeur, director of Vermont's Medicaid program.  "We
 were able to develop open relationships with the manufacturers which have
 resulted in fewer disputes in subsequent months.  As a result, the state
 receives its rebates more quickly and with far less effort."
 
     EDS Role
     EDS has a well-established market presence in providing information
 technology and support services to the government health care sector.  EDS now
 provides Medicaid administrative support services to 18 states and supports
 the Medicare program in seven states.
     "With pharmaceutical expenditures at an all-time high, EDS is committed to
 working strategically with clients to develop programs that meet their
 specific, immediate and long term goals," said Shona Mossey-Lothrop, EDS
 interChange pharmacy service offering manager.  "EDS takes great pride in
 working with federal and state governments to affect positive and innovative
 change in health care service and delivery.  We are always willing to take on
 challenges to assure quality of care and best cost containment strategies in
 the marketplace."
     EDS, the leading global services company, provides strategy,
 implementation and hosting for clients managing the business and technology
 complexities of the digital economy.  EDS brings together the world's best
 technologies to address critical client business imperatives.  It helps
 clients eliminate boundaries, collaborate in new ways, establish their
 customers' trust and continuously seek improvement.  EDS, with its management
 consulting subsidiary, A. T. Kearney, serves the world's leading companies and
 governments in 55 countries.  EDS reported revenues of $19.2 billion in 2000.
 The company's stock is traded on the New York Stock Exchange and the London
 Stock Exchange.  Learn more at www.eds.com.
 
      CONTACT:
      Delbra Bristol - EDS
      (+1) (972) 604-6075
      delbra.bristol@eds.com
 
 

SOURCE Electronic Data Systems Corporation
    PLANO, Texas, April 18 /PRNewswire/ -- When state Medicaid programs and
 drug manufacturers disagree, the financial cost runs into huge sums of lost
 money that can be used to support health care programs for those in need.  EDS
 (NYSE:   EDS) and several government agencies have introduced a new way of
 getting the sparring parties to the table and successfully negotiating more
 favorable outcomes.
     At issue are unresolved Medicaid drug rebate disagreements between state
 Medicaid programs and drug manufacturers, which cost taxpayers close to
 $2 billion nationally each year, according to federal data.  Federal law
 requires drug manufacturers to pay states a quarterly rebate based on units of
 drugs dispensed per manufacturer each quarter.  On one hand, Medicaid agencies
 have claimed they were not receiving all of the entitled rebate funds; on the
 other, manufacturers have withheld substantial amounts if the companies
 disagreed with or expressed uncertainty about the way the rebate sum was
 calculated.
     The solution comes courtesy of the Health Care Financing Administration
 (HCFA), which, along with EDS and several New England Medicaid agencies,
 developed alternative resolution techniques to help resolve drug rebate
 disputes.  Acting as facilitator, HCFA brings the parties together,
 establishes a positive climate, coaches pre- and post-meeting sessions,
 develops timelines to fulfill commitments and follows up with the parties to
 ensure successful resolution.
     As a result, longstanding disputes are being solved.  In New Hampshire
 alone, approximately $700,000 was recovered through the new dispute resolution
 process.  In Vermont, nearly $750,000 has been negotiated back to the state.
 A large portion of these funds had been in dispute for more than four years.
     "The key element of this program's success is the cooperative spirit of
 partnership which has been fostered through the program among the federal
 government, state governments, the pharmaceutical industry and private
 players, such as EDS," said Michael Keogh, director of HCFA's Dispute
 Resolution Program (DRP).  "Before the DRP, countless hours were spent
 gathering data which ultimately did not end in acceptable resolution for
 either party.  Since the onset of the program we have been able to negotiate
 and build relationships which have resulted in outstanding results for state
 Medicaid programs."
 
     Results Gaining Notice
     The HCFA, EDS and six New England Medicaid programs -- including EDS
 client agencies Connecticut, New Hampshire, Rhode Island and Vermont -- were
 honored earlier this year with the Hammer Award for reinventing the way these
 disputes are settled and millions are recouped.  The Hammer Award is given by
 the vice president of the United States to government entities for
 demonstrating innovative reinvention.
     The award-winning process has now been incorporated in HCFA's ongoing
 program activities.  As well, HCFA has published a "Best Practices" for
 dispute resolution, which outlines the process and can be used by other states
 and manufacturers.  In addition to the Hammer Award, the DRP is one of
 25 programs out of 1,600 nominees nationwide recognized in 1999 by the Council
 of Excellence in Government's prestigious "Innovations in American Government
 Award."
     "The New England states worked together as a team to discuss common issues
 in addition to individual state issues with the pharmaceutical manufacturers,"
 explained Paul Wallace-Brodeur, director of Vermont's Medicaid program.  "We
 were able to develop open relationships with the manufacturers which have
 resulted in fewer disputes in subsequent months.  As a result, the state
 receives its rebates more quickly and with far less effort."
 
     EDS Role
     EDS has a well-established market presence in providing information
 technology and support services to the government health care sector.  EDS now
 provides Medicaid administrative support services to 18 states and supports
 the Medicare program in seven states.
     "With pharmaceutical expenditures at an all-time high, EDS is committed to
 working strategically with clients to develop programs that meet their
 specific, immediate and long term goals," said Shona Mossey-Lothrop, EDS
 interChange pharmacy service offering manager.  "EDS takes great pride in
 working with federal and state governments to affect positive and innovative
 change in health care service and delivery.  We are always willing to take on
 challenges to assure quality of care and best cost containment strategies in
 the marketplace."
     EDS, the leading global services company, provides strategy,
 implementation and hosting for clients managing the business and technology
 complexities of the digital economy.  EDS brings together the world's best
 technologies to address critical client business imperatives.  It helps
 clients eliminate boundaries, collaborate in new ways, establish their
 customers' trust and continuously seek improvement.  EDS, with its management
 consulting subsidiary, A. T. Kearney, serves the world's leading companies and
 governments in 55 countries.  EDS reported revenues of $19.2 billion in 2000.
 The company's stock is traded on the New York Stock Exchange and the London
 Stock Exchange.  Learn more at www.eds.com.
 
      CONTACT:
      Delbra Bristol - EDS
      (+1) (972) 604-6075
      delbra.bristol@eds.com
 
 SOURCE  Electronic Data Systems Corporation