Massachusetts To Require Medicaid Beneficiaries To Use Generic Drugs

Citing rising drug costs, Massachusetts will become the latest state to require Medicaid beneficiaries to use generic drugs when available, a move that drug industry executives say "may be the strictest [such program] yet," the Boston Globe reports. Starting Nov. 28, the roughly 860,000 beneficiaries in the state's traditional Medicaid program will have to use generic medications in all available cases except when "medical necessity" is demonstrated and doctors obtain prior approval from the state. The 40,000 enrollees in Medicaid managed care programs will "remain under [their] HMO policies." Medicaid drug spending in Massachusetts has increased by more than 60% in the last four years, to $738 million of the $5 billion program. Dr. Annette Hanson, the program's medical director, said that generic drugs are as safe as brand-name medication in "just about every case," and that the state was implementing the new restrictions in an effort to stop doctors from acceding to patient demands for brand-name drugs. The state currently requires pharmacists to prescribe generic medications to Medicaid beneficiaries unless doctors request brand-name medications, which many doctors do, Hanson added. She said that the changes would save the state $10 million in the first year.

The Most Restrictive?
Several state Medicaid programs have moved to limit brand-name drugs, and these plans have been met with legal challenges by the pharmaceutical industry. Massachusetts' plan differs from those of other states -- such as Florida and Washington -- in that most set a monthly limit for brand-name drugs. Kim Johnson, senior health policy analyst for the American Public Human Services Association, a trade group that includes Medicaid programs, said that states are "using all of the tools they have" to reduce drug costs, "but I don't know anyone that's gone [as] far" as Massachusetts. Jeff Trewhitt of the Pharmaceutical Research and Manufacturers of America, which has sued other Medicaid generic drug programs on the grounds that they violate federal Medicaid law, said, "There's a chance that some doctors won't go through the hassle of getting permission even if they think a brand name is necessary, setting up the potential for second-class medicine for some of the most vulnerable patients in the state. At first glance, this appears to be one of the strictest generic substitution plans we've encountered." Massachusetts officials, however, said that the new policy is "actually less restrictive because it requires" a generic prescription only when such a drug exists, rather than "establishing a strict, arbitrary maximum on brand-name prescriptions" (Kowalczyk, Boston Globe, 10/5). For more information about health policy in Massachusetts, go to State Health Facts Online.