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Eli Lilly to Help Pay for Crafting Medicaid Reforms in Georgia

Posted on: Sunday, 28 August 2005, 18:00 CDT

Aug. 28--The mystery drug company that has offered to help pay the costs of crafting Georgia Medicaid reforms?

Eli Lilly and Co.

The Indianapolis-based pharmaceutical giant acknowledged Friday that it's discussing funding for a "patient-focused initiative" with Georgia officials. Aides to Gov. Sonny Perdue then confirmed that the state is in discussions with Lilly about a donation for Perdue's Medicaid modernization plan.

The question of the company's identity was first raised by an article this week in The Atlanta Journal-Constitution that revealed the existence of the offer. Perdue aides did not disclose the name of the drug company, citing, in part, the firm's request to remain unidentified until final approval of the donation.

The offer -- and the secrecy surrounding it -- has drawn criticism from consumer advocates.

The amount of money in the Lilly offer has not been determined, said Shane Hix, a spokesman for Perdue.

Costs involved in writing Medicaid reform proposals, which require federal approval, can amount to hundreds of thousands of dollars, Medicaid experts say.

Carole Puls, a Lilly spokeswoman, said there had been no decision on where the funds would go.

"Our motivation is to help states not only manage their health care costs, but we also want to improve patient care," Puls said.

She said there was no talk about access to or prices of Lilly drugs in return for the donation.

"There are no strings attached," Puls said.

But consumer advocates have pointed out that drug companies have much at stake in Medicaid policy and reform. The state spends more than $1 billion annually on drugs in its Medicaid program, which provides government health coverage for 1.5 million poor and disabled Georgians.

Pharmaceutical companies, through donations or other free programs, could seek, as a payback, the easing of state restrictions and discounts on their drugs, the consumer advocates say.

Lilly said company partnerships assist Medicaid programs in 24 states, helping to manage patients' chronic diseases, such as diabetes, and ensuring that patients are taking medications appropriate to their condition.

But Georgia recently awarded contracts to other companies to perform those functions.

Perdue's Medicaid reform plan aims to curb the average 14 percent annual increases in the program's cost. The Medicaid budget is about $6.6 billion in state and federal funds.

Perdue has already created a seismic shift in Medicaid through a cost-cutting initiative that will move 1 million people into HMOs, along with 200,000 children in the PeachCare program for uninsured children.

Hix, the Perdue spokesman, said Friday that Lilly must still submit any donation proposal to the federal agency that oversees Medicaid for approval.

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Copyright (c) 2005, The Atlanta Journal-Constitution

Distributed by Knight Ridder/Tribune Business News.

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LLY,

Source: The Atlanta Journal and Constitution

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