Consumer Notes

Article excerpt

Maine Rx Price Controls

Maine lawmakers have taken the matter of prescription drug prices into their own hands. Governor Angus King (I), along with legislative leaders, recently approved a measure which will lower drug prices for some consumers by up to 30% by January 1, 2001.

The bill, which uses the bulk purchasing power of the state to negotiate discounts from pharmaceutical manufacturers, will affect some 325,000 Maine residents (approximately 25% of the state's total population) who lack prescription drug coverage as part of their public or private health insurance plan, reports The Wall Street Journal. In addition, if the new program isn't effective in reducing prescription drug prices to a rate comparable to the lowest prices currently being paid by other Maine residents, the state will step in and set its own maximum prices, at a date no earlier than July 1, 2003.

While praised by some, Maine's initiative has been criticized for failing to recognize the complexities of drug pricing. Critics of the measure fear that price controls will stymie the development of new medicines. A legal challenge is anticipated. (See "Drugs, Drug Prices and Your Health," CR, May 2000.)

Texas vs. HMO

In other health-care related news, Aetna U.S. Healthcare recently agreed to settle a Texas lawsuit, filed in 1998 by former Attorney General Dan Morales, which accused the giant insurer of providing improper financial incentives to doctors to limit patient care, as well as other violations of Texas law, reports The New York Times. In the agreement, made with Attorney General John Cornyn, Aetna will give patients new appeals for certain treatment denials, create a system to help Texas patients with such appeals, and allow doctors to participate in some Aetna plans without being forced into other less profitable health plans.

The settlement, which was widely hailed upon its announcement as a landmark model for the rest of the country, has since drawn criticism from physician groups and others who feel that it fails to address two central problems of the industry adequately: undisclosed financial incentives for doctors to limit care, and undisclosed criteria for turning down claims.

Texas vs. HMO II

And also in Texas, a dispute is brewing over whether HMO "preauthorization" decisions constitute "medical" decisions, subject to state medical practice regulation, or simply "coverage" decisions, which are exempt from such scrutiny. …