States should be paid for drug bills: lawmakers

By Joanne Kenen

WASHINGTON (Reuters) – With about half of the U.S. states
now paying for prescription drugs for poor and elderly caught
in Medicare drug snafus, lawmakers on Thursday demanded that
the federal government step in to reimburse them.

The calls in Congress came mostly from Democrats, joined by
a few moderate Republicans. Republican governors have also
complained about implementation of the drug benefit, which
started on January 1.

The focus has been on the more than 6 million “dual
eligibles” who qualify for both the Medicaid program for the
poor and the Medicare program for the elderly and disabled.

“They are the sickest of the sick, the frailest of the
frail,” West Virginia Democratic Sen. Jay Rockefeller, who has
tried for two years to address what he said were inevitable
problems with the poorest elderly, told a news conference.

Many of the poor were either not enrolled properly or were
randomly assigned to plans that did not include the drugs they
need. About 25 states and Washington, D.C., are paying for the
medications, and some pharmacies are also absorbing costs.

Senators calling for the federal government to pay the
multimillion-dollar tab include both those who like Rockefeller
opposed President George W. Bush’s Medicare drug plan from the
start, as well as some centrists who voted for it such as
Republicans Norm Coleman of Minnesota and Olympia Snowe of
Maine.

The Democrats said at a news conference they did not know
what all the state spending totaled, but cited such examples as
$15 million for New Jersey and $70 million for California in a
program that is less than three weeks old.

BURDEN ON STATES

“States are very concerned because they’ve stepped in and
they’ve been told that these costs won’t be reimbursed,” said
Scott Pattison, executive director of the National Association
of State Budget Officers. “It may be a small percentage of
state budgets, but it’s still a lot of money that they hadn’t
planned on spending.”

Administration officials running the Medicare drug program
have acknowledged difficulties with the roll-out, but have said
the program is working for millions of people. They have said
states should not expect payment from Washington but instead
should deal with the many private insurers who are providing
the new benefit.

The administration has said the private companies that are
providing the drug benefit should pay for 30-day supplies of
any drug a beneficiary was already taking.

Democratic senators said the federal government can recoup
the costs from the private health plans offering the Medicare
benefit, but they do not want 50 different states to have to
deal with dozens of different insurers that are under contract
to Washington, not the states.

In the House, Maryland Democrat Ben Cardin plans to
introduce companion legislation later this month but an aide
said he does not yet have any Republican co-sponsors.

Iowa Republican Sen. Charles Grassley, the Finance
Committee chairman and a co-author of the drug law, opposed any
legislative fixes right now but said he would closely watch how
the administration and health plans address the problems.

“It’s unacceptable that some of the poorest, sickest people
are having the most trouble, and it’s not what Congress
intended,” Grassley said in a statement.

(Additional reporting by David Lawder)