Magazine article Drug Topics

Medicaid Drug Costs Jump Again as Poverty Line Rises

Magazine article Drug Topics

Medicaid Drug Costs Jump Again as Poverty Line Rises

Article excerpt

What do Medicaid and the Mississippi River have in common? Both look muddy, and both overflow their banks. A look at the recently released fiscal 1992 Medicaid drug reimbursement figures revealed a rising flood of state outlays that refuses to subside.

Fiscal 1992's national cost for Medicaid drug reimbursements (see chart on page 72) (chart omitted) totaled $6.8 billion, an increase of 25% from fiscal 1991's total of $5.4 billion. The total number of Medicaid drug benefit recipients, meanwhile, rose 12.7%, from 19.6 million in 1991 to 22 million in 1992. In other words, not only did the growth of Medicaid's drug expenses far outstrip the inflation rate, but it doubled the growth rate of the number of people who received drugs under the government program.

The increases reflect how Medicaid cost increases have swamped most state budgets, said Bruce Colligen, v.p.-health program, National Pharmaceutical Council, Reston, Va. His organization, in conjunction with the Health Care Financing Administration, Washington, D.C., provided Drug Topics with the statistics.

"Medicaid is now the largest component of any state's budget," Colligen said. "Given certain federal mandates and expanded services, the numbers do not surprise me. There has been a general rise in terms of [drug] utilization, and there have been more people added to the system. Eligibility requirements have been loosened up; more people qualify for Medicaid because the poverty line has been raised. …

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