State Scan

States in Rx fix

By Contributing Editor Daniel B. Moskowitz

State legislators opened their 2001 sessions tired of waiting for Congress to add a drug benefit to Medicare and determined to act on their own to make it easier for seniors—and, in many cases, others without health insurance drug coverage—to afford the prescriptions they need. According to the National Conference of State Legislators, bills were introduced in 44 states to use bulk purchasing clout to get lower drug prices for their residents, force manu-facturers to give discounts to a wider group of buyers, subsidize drug purchases for those in a budget squeeze or otherwise address the problem of drug costs zooming beyond the means of many. But by mid-spring, it was evident that Congress is not alone in its inability to resolve the drug problem; very few state initiatives are going to become law.

• In Washington State, drug-makers defeated a bill to establish a state-wide formulary—and have manufacturers bid competitively for places on the list. Moreover, the legislature's budget panel killed a measure that would have sub-sidized drug purchases for the poor and elderly at a cost of $40 million.

• In Montana, a plan to let seniors use half their drug outlays as a credit against state income taxes was killed by a 43-57 vote in the House.

• In Mississippi, a bill to extend Medicaid's drug benefit to seniors with incomes below 250 percent of the federal poverty level died in a House committee.

• In South Dakota, separate bills demanding that drugmakers offer all buyers the discounts offered to some were killed in Senate and House committees.

• The Wyoming legislature adjourned without acting on a measure to have a state agency set maximum prices for prescription drugs.

• A budget squeeze in Kansas had officials considering cutting back or delaying implementation of a drug-buying assistance program passed by the legislature last year and due to begin July 1.

Even bills that passed the legislatures ran into political problems. For instance, a Virginia proposal to spend $145,000 to promote pharmaceutical companies' existing programs to provide free drugs to indigents was sent back to the lawmakers by the governor, who wanted language added to clarify that the measure would go into effect only after special funding was appropriated.

As the difficulties of passing state-specific laws became clearer, the states have been turning to alternative approaches. The New Mexico legislature passed a resolution asking Congress to be quick about adding a prescription benefit to Medicare. Officials from New England and the mid-South states began work on forming broad drug-buying coalitions to get cheaper prices for their citizens. And a group of state attorneys general are developing a class action against drug companies to force them to change the way they calculate prices charged for Medicaid programs—and to pay back years of alleged overcharges.

 

Daniel Moskowitz. States in Rx fix. Business and Health 2001;5:16.