Author Gathering Place

State Sen. Ron Menor

Drug reform
needs to use lessons
learned elsewhere

I was surprised and pleased to read the Nov. 14 article by Richard Borreca about the governor's decision to throw her support behind an improved version of the Hawaii Rx program. Those legislators who fought for this measure, designed to bring relief from skyrocketing drug prices to Hawaii's less affluent residents, look forward to working with the administration to make our state a leader once again in providing health care to its residents.

The Star-Bulletin article indicated the governor has not defined the changes she will be proposing to the Hawaii Rx law, but we don't have to reinvent the wheel. Thanks to recent efforts of Maine officials to enhance their Rx program, excellent model legislation already exists. During my trip to Maine in September with Rep. Roy Takumi and Greg Marchildon of AARP Hawaii, Maine officials explained the improvements that now can be made to state prescription drug programs.

Incorporating the same changes into Hawaii's program will result in a better program and enhance our state's ability to withstand potential legal challenges by the drug companies. I will be working with Rep. Takumi and other lawmakers to produce legislation that will establish a Hawaii Rx Plus program. That legislation should include the following provisions:

>> The addition of an income limit of 350 percent of the federal poverty level for participation in the program (e.g., the income limit for a family of four will be approximately $64,400, and for a single individual roughly $31,400). This change would address a criticism noted in the U.S. Supreme Court opinion that the original Maine program did not have an income restriction. It also would ensure that the Hawaii program focuses on those who truly need assistance -- those who lack drug coverage or have poor coverage.

>> A stipulation providing a limited exemption for certain categories of people who do not meet the income limit but still need the benefits offered under the program. For example, under Maine Rx Plus, a resident is eligible for the program if the resident's family incurs unreimbursed expenses for prescription drugs "that equal 5 percent or more of family income, or total unreimbursed medical expenses are 15 percent or more of family income." Hawaii's program should include a similar provision.

>> A requirement that any medication on the preferred drug list under the state Medicaid program also should be covered under Hawaii Rx Plus. Members could then purchase these drugs at Medicaid prices, which are significantly lower than retail prices.

>> A provision authorizing the Department of Human Services to secure further discounts by entering into rebate agreements with pharmaceutical manufacturers.

>> An appropriation to cover start-up costs for the program. Maine officials have projected program costs for Maine Rx Plus at $0.8 million for FY 2004 and $2 million for FY 2005. Since the size of Hawaii's population is almost the same as Maine's, program costs for Hawaii Rx Plus should be comparable. Maine officials have offered to work with Hawaii to arrive at realistic cost estimates to administer the program, and we should take them up on their offer. The start-up funding would be a one-time appropriation since a portion of the rebates that the drug companies would pay to the state would reimburse the state for the start-up costs as well as cover future administrative costs. After start-up, Hawaii Rx Plus can thus provide significant benefits to many people at virtually no cost to taxpayers.

A key benefit of Hawaii Rx Plus is the money it will save, since it will not require the expenditure of any federal or state Medicaid funds. It will benefit the "gap group" whose members earn too much to be eligible for Medicaid but who cannot afford expensive medications. And because it will not require federal funds, the implementation of Hawaii Rx Plus likely will not require the approval of the federal government -- a process that prevented the implementation of the Healthy Hawaii Medicaid Waiver Program.

As one of the authors of the Hawaii Rx law, I believe that the improved program offers the best solution to the problem of rising prescription drug costs. I look forward to working together with the governor and my fellow legislators during the 2004 session to make such a program a reality.

Ron Menor is chairman of the Senate Commerce, Consumer Protection and Housing Committee.


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