Maine’s Drug Discount Program Violates Medicaid, Interstate Commerce Laws, PhRMA Contends in Papers Filed Last Week

The Pharmaceutical Research and Manufacturers of America and the Bush administration on Sept. 20 filed separate Supreme Court briefs objecting to Maine Rx, the state's preferred drug program meant to limit the rising costs of prescription medications, the Washington Post reports (Goldstein, Washington Post, 9/22). Under the program, which was enacted by the state Legislature in 2000 but has not taken effect, Maine would negotiate with drug makers for discounts similar to those given to the Medicaid program. The state would use the savings to reimburse pharmacies for giving discounts to customers who lack drug coverage. State officials estimate eligible residents would save 10% to 30% on prescription drug costs under the program. In an effort to encourage drug company participation, the program includes a provision under which doctors would have to receive prior approval from a patient's health plan administrator to prescribe medications from companies that are not part of the program. In 2000, PhRMA filed a lawsuit against Maine Rx, arguing that it was not authorized by federal Medicaid law and that it was a "burden on interstate commerce." Initially, a federal district court in Maine ruled in favor of PhRMA, but in May 2001 the 1st U.S. Circuit Court of Appeals in Boston overturned the decision and said the program could go forward. On May 31, the Bush administration asked the Supreme Court to reject PhRMA's appeal, but in June the Court agreed to hear the case, PhRMA v. Concannon (Kaiser Daily Health Policy Report, 7/1).

Illegal Program?
In its brief, PhRMA contends that Maine Rx violates Medicaid law by making it more difficult for beneficiaries to obtain certain medications. "In effect, Maine is holding Medicaid patients' prescription drug benefits hostage to the state's fundraising efforts on behalf of others outside the Medicaid program," the brief states. PhRMA also argues the program violates the Constitution's interstate commerce provisions, which prohibit a state from regulating businesses outside its borders. Under Maine Rx, rebates would be extracted from out-of-state drug companies that do not conduct business directly with the state, but rather deal with wholesalers within the state, the brief states. In a separate brief filed Sept. 20, the Department of Justice contends Maine Rx is illegal for a "much more limited reason" than PhRMA does, the Post reports. In its brief, the Justice Department said the program is illegal because it is not "specifically targeted to people who are poor or elderly, or who have a different need for help in paying for medicine," the Post reports. However, the White House added that despite its objections to Maine's program, it has encouraged states to continue experimenting with ways to lower prescription drug prices. "Nobody should say we are supporting PhRMA over Maine," an unnamed administration spokesperson said, adding that HHS last week encouraged states to submit proposals for increasing access to prescription drugs for low-income residents who do not qualify for Medicaid (Washington Post, 9/22).

Maine's Senate Race
In related news, Long Island Newsday on Sept. 23 examines Maine's U.S. Senate race, in which "one of the most pressing campaign issues for seniors -- prescription drug coverage -- has taken center stage." Democratic candidate and former state Senate Majority Leader Chellie Pingree has made prescription drugs "the centerpiece" of her campaign platform, Newsday reports. She helped write the legislation authorizing Maine Rx and has "traveled the country" explaining why similar programs should be implemented nationally. But incumbent Sen. Susan Collins (R-Maine) is working to "successfully neutraliz[e]" the traditional Democratic advantage on health care issues, Newsday notes. Collins "shared the [health care] spotlight" earlier this year as one of the sponsors of Senate-passed legislation (S 812) that would allow greater access to generic drugs. The Maine election also has drawn the interest of national senior advocacy groups, Newsday reports, which are "targeting" the race and coordinating events that "keep the [prescription drug] issue in the forefront" (Barfield Berry, Long Island Newsday, 9/23).