OBJECTIVES: We implemented a focused drug therapy management intervention aimed at reducing polypharmacy for Medicaid recipients in North Carolina nursing homes. Targeted were patients receiving > 18 prescriptions in 90 days. During scheduled monthly home visits, consultant pharmacists providing routine drug regimen reviews also reviewed drug profiles displaying claims-generated drug problem alerts. Pharmacists documented reviews, recommendations and resulting drug therapy changes. Study objectives were to determine: 1) the frequency with which potential drug therapy problems (PDTPs) were found and persisted following interventions, and 2) the impact of interventions on quality and patient drug costs from a payer perspective. METHODS: Before-after study with comparison group design. Medicaid prescription claims data were compared for three months prior to and following the intervention. RESULTS: In total, 253 nursing homes, 110 consultant pharmacists, and 6344 patients participated in the study arm, with 5160 patients remaining at the end of the follow-up period. At baseline, study group patients used an average of 9.7 prescriptions per month, costing the NC Medicaid program $517(USD). There were 5918 recommendations offered for 3262 patients, or an average of 1.58 per patient. At least one profile-related pharmacist intervention was implemented for 72% of patients, about half involving a switch to a lower cost drug. Two of five alert categories had highly significant reductions in alert persistence of 10.8% and 29.7% respectively versus 0.7% and 14.1% in the comparison group. Drug costs for study group patients were $57 lower than comparison group patients at followup (p<0.05). CONCLUSIONS: A supplemental program of medication reviews for targeted NH patients resulted in a reduction in the persistence of PDTP alerts and was cost beneficial based solely on drug cost savings. This intervention may be a model for future medication therapy management services provided by prescription drug plans under Medicare for patients in long-term-care settings.