A budget crunch in Washington state could have dire consequences for recipients of Medicaid pharmacy benefits.

Washington state, Medicaid, pharmacy benefits, pharmacy reimbursement, prescription drug benefits, prescription drugs, budget crunch, Chris Gregoire, Medicaid adult drug program, National Association of Chain Drug Stores, NACDS, Washington State Pharmacists Association, Washington Food Association, Washington Retail Association, Carol Kelly, Richard Monks, Walgreens, Bartell Drugs, drug store, pharmacy

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Budget woes threaten Medicaid Rx in Wash. state

December 22nd, 2010

SEATTLE – A budget crunch in Washington state could have dire consequences for recipients of Medicaid pharmacy benefits.

If state legislators aren't able to resolve Washington's budget shortfall when they reconvene in January, adults who buy prescription drugs through the state's Medicaid program could lose that coverage.

Washington Gov. Chris Gregoire and members of the state legislature face a $1.1 billion budget deficit and thus far have been unable to agree on a way to narrow the gap. Among the many programs flagged for potential cuts is the Medicaid adult drug program, which provides medication to 500,000 patients. Eliminating the program could save Washington $40 million a year.

A coalition including the National Association of Chain Drug Stores, the Washington State Pharmacists Association, the Washington Food Association and the Washington Retail Association has lobbied state lawmakers to preserve the program. The groups said that terminating the Medicaid adult drug benefit in Washington would endanger patient health and end up increasing costs in other areas of the public health care system.

"Over the past several years, the states have really wrestled with their budgets, and we sympathize with this," said Carol Kelly, senior vice president of government affairs and public policy at NACDS. "But it is important that they don't look to eliminate essential programs as a way to balance their budgets. Healthy pharmacy is a critical part of ensuring that you have a healthy patient."

However, the coalition's message may be getting through, according to Kelly. A special session of the legislature this month proposed cutting nearly $500 million in spending, and the Medicaid adult prescription plan wasn't part of the discussion.

The coalition has pointed out three options that its members said could save Washington much more than the $40 million annual cost of the prescription program. Adding a medication therapy management component could save $8 million a year, according to Kelly. Also, increasing generic substitutions by 3.4% could provide another $28 million in savings, and getting about 20% of the state's doctors to adopt electronic prescribing would slice $25 million from the program's cost.

In the chain drug arena, Washington's budget crunch already has taken a toll on Medicaid prescription drug benefits through state cutbacks in pharmacy reimbursement.

Walgreen Co. in April stopped accepting new Medicaid prescriptions in Washington state, where it has approximately 120 stores. The chain initially planned to cease filling Medicaid prescriptions in February at 64 stores because of a continued reduction in pharmacy reimbursements and later extended the deadline a month while talks with the state continued.

Earlier, in February, Puget Sound-area chain Bartell Drugs discontinued filling Medicaid prescriptions at 15 of its 57 drug stores, pointing to recent cutbacks in pharmacy compensation from Washington state.