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Increase Prescription Drugs Access for Low-Income Populations

Preventing Loss of Medicaid Drug Rebate Funds for States

While the new Affordable Health Care law provides a variety of funding opportunities for states, one provision in the health law that could shift billions of dollars from cash-strapped states to the federal government.  Under the National Medicaid Drug Rebate Program created by the Omnibus Budget Reconciliation Act of 1990, drug manufacturers are required to enter into agreements that provide rebates for Medicaid purchased drugs, establishing a 15% minimum level of rebates.  Up until now, the rebates were divided between the states and the federal government.  But under the new health reform law, a significant portion of the rebates will go solely to Washington beginning this year.

"340B" - Access Reduced Drug Prices: Key Facts, Polling, Best Practices

Policy Overview:  Create a task force to study and report how best to maximize participation in 340B pricing, a provision of the Federal Public Health Act that authorizes discounted drug prices (below Medicaid levels) for certain populations and safety net health care providers, like rural hospitals, federally qualified health centers and prison populations.  States have numerous options that should be studied and explored to ensure that populations and programs eligible for 340B pricing are receiving the reduced prices, resulting in savings for state budgets and consumers.

Rx Reforms to Address Budget Deficits and Ensure Quality of Medications

As part of our Shared Multi-State Agenda, the Progressive States Network is working with legislators, advocates and leading experts to promote Rx reforms in 2010 that will reduce health care costs for consumers, businesses, and state and local governments, and will help ensure access to safe and effective medications.  Through coordinated, strategic support, PSN and our allies will be working to introduce and advance Rx reforms that will help address state budget deficits and improve access to quality medications in as many states possible; providing model legislation, policy analysis, messaging and more - all of which has been gathered and will be constantly updated on our Prescription Drug Reform Shared Agenda web page.

Health Care for All: Policy Options for 2009

Download a copy of the report in PDF format here.  View the HTML version of the report here.

OVERVIEW

States are thinking more creatively about how to enable populations that are ineligible for Medicaid to purchase drugs at the same reduced prices negotiated by Medicaid.

  • Discount Programs: Maine Rx negotiates with drug companies to provide more affordable drugs to residents living below 350% of the poverty line.  The program, as NLARx reports, uses the leverage of the state's Medicaid program to achieve average savings of 25-50% on generic and brand name drugs for residents not eligible for Medicaid.
  • 340B Pricing: Under federal law, certain "safety-net" programs and providers can purchase prescriptions at significant discounts, often below what Medicaid pays for drugs.  States can ensure that populations and programs eligible for 340B pricing are receiving the reduced prices.  Legislation in Massachusetts (H 2243) would require eligible health care centers to participate in 340B pricing, and Vermont's comprehensive prescription reform act of 2007 requires the state to inform residents of the availability of 340B pricing.

Resources:

NLARx - Discount Plans and Purchasing Pools

NLARx - A Guide to Best Practices for the Federal 340B Program

Prescription Policy Choices - Model Legislation: PBMs Transparency and Fiduciary Standards

Focus on Prescription Drug Reform

$287 billion -- that is how much the U.S. spent on pharmaceuticals in 2007, representing a significant driver of health care costs.  While spending on hospital and physician care surpass spending on prescriptions, drugs still account for 14% of all health care expenditures. Combine this with polls that show 70% of Americans believe the drug industry puts profits ahead of people, and it's no wonder that in 2008, at least 540 bills and resolutions are being considered by states across the country to reduce prescription drug prices, ensure the quality of medications covered by public and private health plans, and reduce the undue influence of pharmaceutical industry marketing - which itself tops out at $30 billion each year.

Health-Care-for-All On the Installment Plan

Incremental steps to improve the health care system can lay the foundation for comprehensive reform that provides health care for all. Comprehensive reforms enacted in Massachusetts, Vermont, Maine and San Francisco were, in large part, the result of pragmatic incremental steps those states had already taken. For example, a Families USA report discusses the many reforms Massachusetts put in place over the years that led to its comprehensive 2006 reform. Not every state is as far along in moving comprehensive health care reform, but each state does have numerous options for increasing access to coverage, reducing the growth of health care costs, and improving the quality of care.