Florida House Votes to Expand Generic Drug Access, as Illinois Stands By Fee Cuts to Medicaid Pharmacists

In continuing Kaiser Daily Health Policy Report coverage of states' efforts to address rising prescription drug costs, the following summarizes recent news from Florida and Illinois.

• Florida: The state House on April 10 passed a bill (HB 69) that would require the state boards of pharmacy and medicine to defer to the FDA when updating the list of generic drugs that pharmacists may not substitute for brand name prescriptions. Under the bill, if the FDA has classified a drug as "therapeutically equivalent" to the brand name drug, pharmacists must be permitted to dispense the generic drug in order to save costs, although physicians could still require the brand name drug by deeming the prescription "medically necessary" (Bhatt, Palm Beach Post, 4/11). If enacted, the bill would remove Coumadin (warfarin), Dilantin (phenytoin), Quinaglute Dura-Tabs (quinidine) and Theodur (theophylline) from the state's list of prohibited substitutions. The state Agency for Health Care Administration estimates the change would save Medicaid about $4 million -- an amount that would offset the state's lost rebates that brand-name drug manufacturers pay the state when it buys their drugs. The bill is expected to be considered by a Senate committee today (Allison, St. Petersburg Times, 4/22).
• Illinois: To control rising costs in its $1 billion Medicaid drug budget, the state is cutting about $60 million in payments to pharmacists who serve Medicaid patients over an 18-month period ending June 30, 2002. While pharmacies usually receive about $100 million annually from the state, Gov. George Ryan (R) said the lower dispensing fees are in "line with neighboring Midwest states." The cut trims dispensing fees by $2.50 per prescription, to $4.17. In response, the Illinois Pharmacist Association released a study that found the cuts would cost pharmacies an average of $15,310 per month, and the Walgreen Co. drugstore chain said it would be forced to reduce hours and services at 30 stores that serve large Medicaid populations, though the company temporarily backed away from the plan after "public outcry." But Ryan has not "changed his mind" about the cuts. Meanwhile, state lawmakers are considering ways to restore the funding and still save money, including by requiring a copayment on drugs from Medicaid patients (Jaspen, Chicago Tribune, 4/19).