Task force recommends state subsidize prescription drugs

Posted: Wednesday, October 02, 2002

JUNEAU (AP) -- Alaska should join 34 states in creating a program to subsidize the rising cost of prescription drugs to those in need, said a state report issued Wednesday.

The report was part of several recommendations from a task force Gov. Tony Knowles appointed in August to study the rising costs of such drugs to seniors and the disabled.

In its report, the panel said 34 other states have some type of program to provide pharmaceutical coverage or assistance to elderly or the disabled not eligible for Medicaid.

In the absence of a federal plan to include prescription drugs for Medicare, Alaska can expect increased costs in the future, it said.

The task force estimates total prescription drug spending for Alaskans 65 and older will more than double in the next five years to $187 million as the state's population ages.

The panel recommended that the state institute a direct benefit program that qualifies it for best price exemption under Medicaid to help in negotiating higher rebates.

That program uses state funds to subsidize prescriptions, usually for low-income seniors who do not qualify for Medicaid and have no private insurance.

It would also help the state implement preferred drug lists, prior authorization requirements and other cost-containment tools.

No estimate of the added cost to state government was included in the report. But it said a direct benefit program could be combined with drug regimen reviews and education programs to reduce the use of prescription medicines.

Prescription drug costs rose between 25 and 27 percent for Alaskans receiving Medicaid last year while nationwide the increase was about 17 percent.

''That's what most of our older people are facing,'' said John Patrick Luby, who chaired the six-member task force. Luby is with the American Association of Retired Persons.

Alaska paid $62 million in additional Medicaid expenses last year due to rising costs of prescriptions, said Lt. Gov. Fran Ulmer, who unveiled the report during a press conference in Anchorage.

Ulmer is the Democrat nominee for governor and has made prescription drug costs a campaign issue. She urged the next administration to consider the panel's recommendations.

Knowles, who created the task force that included state officials, a pharmacist, a senior advocate and an insurance industry representative, did not attend the press conference. A spokeswoman said he was in Juneau.

The report noted that the Alaska Pioneer Homes reduced drug usage by 50 percent by reviewing medication and discussing it with the resident and physician.

Alaska Medicaid recipients currently pay a $2 co-payment for prescriptions. The task force also recommended the Medicaid program consider change to that co-payment to promote generic drugs and reduce the use of expensive brand-name drugs.

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