Walgreens said it will continue to fill Medicaid prescriptions at its Washington state pharmacies through March 15 as it continues to negotiate with officials over a reimbursement dispute.

In January, the national pharmacy chain said it planned to stop filling prescriptions in 64 of its stores in Washington due to continued reductions in reimbursements under the State of Washington Medicaid program.

Walgreens said Washington Medicaid was reimbursing its pharmacies below cost to break even on nearly 95% of brand name medicines and urged the state legislature to take action to fix pharmacy reimbursement rates.

In a statement, the Deerfield, Ill.-based company said that it decided to delay its withdrawal amid “constructive talks” with the state.

“We’re encouraged by the state’s willingness to continue working with us to find a solution that will allow all of our stores to continue serving our Medicaid patients,” said Kermit Crawford, Walgreens senior vice president of pharmacy. “We recognize the budget challenges the administration and the Legislature face and we’re optimistic that our continued talks will result in a solution that will provide the savings the state is looking for, while allowing pharmacies to maintain service for those patients with the most need and the fewest options.”

Susan Dreyfus, secretary of the Washington State Department of Social and Health Services, said the state appreciates the delay and “the thoughtful ideas” Walgreens has suggested to reduce overall pharmacy costs.

“I am committed to working constructively with them, the entire pharmacy community, and the legislature on further strategies that will allow us to meet the needs of our Medicaid enrollees within a very difficult budget environment,” Dreyfus said.

Walgreens was involved with a similar dispute with officials in Delaware last year over the same issue of Medicaid reimbursements, ending in a compromise between the two sides.