States To Be Reimbursed For Drug Costs

Forty-four states and the District of Columbia will participate in a program designed to reimburse them for certain expenses incurred during the first weeks of the new Medicare drug benefit.

The states bought medicine for their poorest residents when some of them were not listed as being enrolled in a private plan offering drug coverage, or when those residents couldn't afford the co-payments they were erroneously being charged.

States, as well as many members of Congress, were demanding reimbursement. Several bills have been filed on the issue.

Medicare will reimburse those states by covering their administrative costs as well as any differential between how much they paid for the medicine through Medicaid and how much they were reimbursed by the private drug plans.

"The governors of these states have worked closely with us, making them strong partners in helping to make sure that every beneficiary who enrolled in a drug plan gets their coverage," said Health and Human Services Secretary Mike Leavitt.

Mark McClellan, administrator for the Centers for Medicare and Medicaid Services, said that most states stepping in have been paying for, at most, one or two prescriptions a day for each pharmacy in the state.

CMS officials said the states bearing the most expense are Massachusetts, California, New Jersey and New York. The agency does not have an estimate of how much money the states will be reimbursed.

The six states not listed on the press release announcing the program were Idaho, Indiana, Iowa, Michigan, Nebraska and South Carolina.