What a reimbursement floor is
A reimbursement floor is the lowest amount a PBM or health plan is legally allowed to pay a pharmacy for a covered prescription. Its purpose is narrow: to stop a pharmacy being reimbursed below what the drug actually cost it to buy and hand to a patient. A floor does not set a patient’s copay or what a plan pays a drug manufacturer — only the minimum the pharmacy receives. That minimum is the core figure recorded for each state in the tracker.
The two components
Almost every floor is built from two pieces. The first is a drug-cost benchmark — usually NADAC, the national average drug acquisition cost CMS publishes from a survey of what pharmacies actually pay, or, where NADAC is unavailable, the pharmacy’s own acquisition cost. The second is a professional dispensing fee, which under federal Medicaid rules covers the pharmacist’s time, drug-utilisation review, counselling, and the overhead of running the pharmacy. So a typical floor reads as “NADAC plus a dispensing fee,” with the fee commonly in the region of $10–$11 per prescription — though the exact figure is set by statute and varies.
Scope is the variable that matters
Floors are enacted state by state, and the most important difference between them is scope — who the floor protects. Kentucky’s enacted law, for example, sets a minimum of NADAC plus a dispensing fee of not less than $10.64 for the commercial market and most state-employee plans. Other states draw the line differently: some apply a floor only to Medicaid managed care, some only to small independent pharmacies, and some have a floor that is still pending rather than in force. Because each state defines the benchmark, the fee, and the covered plans differently, the state tracker sets them out side by side, state by state.