State of Iowa Department of Health and Human Services

Pharmacy Average Actual Acquisition Cost

The 84^th Iowa General Assembly enacted during the 2012 Iowa Legislative Session the requirement that the Department of Health and Human Services (HHS) perform a cost of dispensing survey and implement an average actual acquisition cost (AAC) reimbursement methodology for all drugs. (Senate File 2336, Section 33). Additionally, pharmacies must make available drug acquisition invoice information upon request. Any dispensing fee expenses or acquisition cost information required to be submitted under this legislation that specifically identifies a pharmacy or provider’s individual cost will remain confidential.

Average AAC rates will be updated on a weekly or more frequent basis. Rates will be updated by adjustments reflecting relative changes in published drug prices, and new drug acquisition costs collected through surveys or provider initiated inquiries.

For pharmacy reimbursement related Informational Letters (ILs), refer to the Iowa Medicaid Informational Letters webpage. The following table lists relevant letters related to pharmacy reimbursement updates.