Newsom wanted California to cut ties with Walgreens. Then federal law got in the way

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Newsom wanted California to cut ties with Walgreens. Then federal law got in the way
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Gov. Gavin Newsom declared California would cut ties with Walgreens after the company said it would not distribute abortion pills in some states. Federal rules have required him to walk back that hard-line tweet.

With $10 million in campaign funds, Gov. Gavin Newsom opened a new federal political action committee dubbed the “Campaign for Democracy” to boost Democrats in the 2024 election.that “California won’t be doing business with @walgreens — or any company that cowers to the extremists and puts women’s lives at risk,” after the second-largest U.S.

Federal law is designed to ensure Medicaid patients have choices in where they get healthcare, including prescriptions. Approved providers such as Walgreens are protected by, which states that no health plan or entity can “restrict the choice of the qualified person from whom the individual may receive services.” Legal and Medicaid experts said that makes it extremely difficult for the Newsom administration to disqualify Walgreens.

Gov. Gavin Newsom this week will announce plans to remake San Quentin, one of the state’s most storied prisons, using a Scandinavian prison model that emphasizes rehabilitation. Through a records request, Kaiser Health News 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’s payments, which are also offset by rebates from drug manufacturers.

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