NCSL on Medicare Part D and state budgets

The Medicare Part D drug benefit has not—at least todate—significantly affected most states’ budgets, according to a newsurvey of Medicaid officials in 47 states. Fourteen states are payingabout the same for drug coverage for “dual eligibles” under Part D asthey were when those beneficiaries received that coverage throughMedicaid (see chart, below). Twelve states report paying more, andeight states say they’re paying less.

On Jan. 1, 2006, Medicare began covering prescription drugs for theapproximately 6.2 million beneficiaries dually eligible for Medicaidand Medicare. In exchange for covering the drug costs of thesebeneficiaries, states must make payments to Medicare (popularly knownas the “clawback”).

Meanwhile, most states report that they don’t expect the DeficitReduction Act of 2005 (DRA) to significantly reduce their spending onpharmacy benefits. The DRA gave states greater flexibility in how theymanage their Medicaid programs, including the ability to increasecost-sharing for prescription drugs. Twenty-three states said they areunlikely to increase cost-sharing.

State Perspectives on Emerging Medicaid Pharmacy Policies and Practices was conducted by the National Association of State Medicaid Directors in collaboration with Avalere Health. Go to: http://www.aphsa.org/Home/Doc/AH_NASMD_Final.pdf