States ‘Not Waiting’ for Federal Action on Prescription Drug Benefit

While President Bush and Congress have debated a prescription drug benefit for Medicare beneficiaries, many states "are not waiting for federal action," with at least 43 states undertaking "serious efforts" to establish or expand pharmaceutical assistance programs during the 2001 legislative session, CongressDaily/A.M. reports. "The issue is hot everywhere," Donna Folkemer, program manager for the National Conference of State Legislatures, said, adding, "There are over 270 bills across the country to either create, expand or alter" pharmaceutical assistance programs. At the beginning of the year, 26 states had a pharmaceutical assistance program for low-income seniors or disabled residents, with 20 providing a direct subsidy through state funds, according to NCSL. The National Governors' Association added that many state pharmaceutical assistance programs -- which cover most, "if not all" prescription drugs and some over-the-counter medicines -- require seniors to pay part of the cost, with premiums "vary[ing] widely," ranging from about $115 to more than $1,000 per participant per year. To help curb costs, some states only cover drugs for chronic diseases, while others may charge "significant" co-payments. In 2001, almost every state has addressed rising prescription drug costs by "changing enrollment criteria" to include more seniors or covering the cost of additional medicines. Some states also added "innovative initiatives" to their programs, such as providing discounted prices through Medicaid. In addition, other states have proposed "bulk purchasing" for "cheaper" pharmaceutical prices, a state tax credit for drug purchases, price controls and state "maximum prices." A few states have also begun to "work with pharmaceutical companies cooperating to provide free or low-cost drugs." Still, some state officials have "tak[en] a wait-and-see approach," hoping that the federal government will provide a drug benefit "before they spend time and money on new programs or beefing up existing ones," CongressDaily/A.M. reports. "There's always a concern that you will move ahead on something, only to have it trumped by the federal government," Patrick Finnerty, executive director for Virginia's Joint Commission on Health Care, said (Wodele/Conley, CongressDaily/A.M., 3/26).

In the States
On March 19, the Kaiser Daily Health Policy Report detailed proposals to assist seniors and the uninsured with prescription drugs costs from 19 states. Since that time, several other states have taken prescription drug coverage proposals under consideration. Summaries of new state proposals appears below:

• North Carolina: Under a bill (HB 669) "talked up" last week by state House Republicans, North Carolina seniors earning up to 120% of the federal poverty level, or individuals with incomes up to $10,308 annually, who "are ineligible for full Medicaid benefits and are enrolled in Medicaid programs," would receive pharmaceutical assistance. The program, called the Prescription Drug Assistance Program for Qualified Aged Persons, would help about 15,000 seniors. According to the AP/Winston-Salem Journal, the state would finance the program with funds from the Health and Wellness Trust Fund -- 25% of the state's share of the national tobacco settlement -- which will receive more than $1.1 billion, about $40 million annually, until 2025 (AP/Winston-Salem Journal, 3/20).
• Minnesota: The state Senate Health and Family Security Committee last week passed on a 6-3 vote a bill (SF 765) that would allow about one million state residents to save about 15% on their prescription drug costs. Under the legislation, called the "Fair Drug Pricing Act," eligible participants could purchase pharmaceuticals at the same prices the government pays for drugs through Medicaid. The bill, sponsored by state Sen. John Hottinger (DFL), would require pharmacists to sell prescription drugs at the "Medicaid price" and apply to the state for reimbursement. While state Senate Democrats back the legislation, Republicans, pharmacists and drug companies oppose the bill, arguing that the measure "could result in further pharmacy closures and stifle drug research because the profit margins would be too narrow" (Lopez Baden, Minneapolis Star-Tribune, 3/20).
• Florida: The Florida Council on Aging released a report last week that found that the retail price of prescription drugs varies by as much as 683% from pharmacy to pharmacy statewide -- prompting some state lawmakers to urge seniors to ask their local pharmacists to "match a lower price offered by another pharmacy." In the survey of 170 pharmacies in 11 Florida cities conducted by the Research Network, researchers compared retail costs for eight brand-name and two generic drugs, finding that prices "varied widely even within cities." The Center for Florida Consumers released a similar survey last September that found "savings of more than $600 a year on a single prescription if consumers shopped around" (Sams, Tallahassee Democrat, 3/22).
• Michigan: The Detroit News reports that lower-income seniors with "substantial" prescription drug costs may qualify for the Michigan's Senior Citizen Prescription Drug Credit. Seniors earning less than $12,525 (146% FPL) -- $16,875 for married couples -- who do not reside in a licensed care facility qualify for the program. Under the plan, eligible seniors who spend more than 5% of their incomes on pharmaceuticals can receive a credit up to $600 -- $1200 for married couples (Preddy, Detroit News, 3/25).