NY state proposed Medicaid cuts threaten recipients, biotech industry

Drug Cost Management Report, Feb, 2003

The state of New York is facing financial challenges, and in the grand tradition of Medicaid cut-backs, the state is considering altering the Medicaid prescription drug program in order to save money. On Tuesday, January 14, the Assembly of Health Committee held a public hearing to discuss the pros and cons of cost-cutting practices used by other states, such as the implementation of a preferred drug list or the expansion or prior authorization.

Advocates for consumers of prescription drugs called on the state to avoid making changes to the Medicaid program that would limit patient access to prescription drugs. Similarly, the New York Biotechnology Association (NYBA) expressed concerns for state's relationship with the biotechnology industry if it does choose to adopt restrictive policies.

Joseph Glazer, president and CEO of the Mental Health Association in New York State, admits that New York's budget situation is extreme and may require some serious adjustments, but he is not in favor of sacrificing the quality of health care to save money. At a public hearing held by the Assembly Health Committee, representatives from other states that have implemented restrictive drug formularies voiced their concerns over the negative impact of these programs on consumers.

Particularly, representatives from Michigan presented first-hand reports from Michigan consumers, family members and providers regarding the negative effects of prior authorization, and cited a major lack of prior planning as a cause of a problems associated with the prior authorization policy. A representative from Florida also was present to relay the its negative experience with its preferred drug list.

Meanwhile, The New York Biotechnology Association (NYBA) responded that the cost-cutting concepts being considered by the state could impact patient health and severely damage efforts to develop New York's rapidly growing biotechnology industry. According to Ron Cohen, MD, NYBA Chairman and President and CEO of Acorda Therapeutics, NYBA and the state of New York have been model partners in promoting biotechnology development in the state. Following three plans to create lifesciences jobs across the state, Cohen fears that implementing restrictive drug policies could counteract those initiatives.

The NYBA feels those in need of new biotech drugs would be denied treatment and may suffer as a result. As a large producer of biotechnology drugs through New York-based companies, the state of New York would be halting its previous efforts to develop the industry, and would deny possible treatment for those in need of new drugs. For more information, contact Joseph Glazer, Mental Health Association in New York State, Inc., (518) 434-0439, or Karen Duncker, NYBA, (212) 661-1780.