New Jersey Asks Federal Government for Funds To Bolster Senior Drug Benefit Program

A New Jersey prescription drug program for low-income seniors, which health care experts have called "a model of success," is running out of money in part because of increasing use of expensive brand-name drugs, the Newark Star-Ledger reports. The program, known as Pharmaceutical Assistance to the Aged and Disabled, or PAAD, covers seniors with incomes up to $19,739 and couples with incomes up to $24,203. Participants pay a $5 per prescription copayment. The program is financed through the state's Casino Revenue Fund, which has grown by only 4.3% per year since 1997. At the same time, the cost of drugs covered by the program is rising faster than the casino fund, at an average of 15% per year. Ken Dolan of the Home Care Council of New Jersey and a member of PAAD's advisory council, said, "If this goes on, we'll bankrupt the system." New Jersey has been paying a greater percentage of the program's costs in recent years, sometimes relying on money from the general fund. This year, the state spent $128 million on the program, compared with $53 million five years ago. State Sen. Robert Littell (R) said, "We've always been able to find the extra money. But it's difficult in a year like this because we're starting out with a deficit." To boost the program's funding, state officials have applied for a $148 million, five-year subsidy from the federal government. CMS is reviewing the state's request and will make a decision in the next few months (Silverman, Newark Star-Ledger, 4/21).