Vermont Removes Nexium From Medicaid Preferred Drug List To Reduce Costs

Main Category: Medicare / Medicaid / SCHIP
Article Date: 23 Jun 2006 - 20:00 PDT

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Vermont on Monday began requiring Medicaid beneficiaries to obtain prior authorization from their physicians before obtaining prescriptions for the acid reflux treatment Nexium, the Burlington Free Press reports. According to the Free Press, the move illustrates the "state's strategy to curb the growth in the cost of prescription drugs in the Medicaid program," which faces a projected budget deficit of $42 million for the fiscal year beginning July 1, 2007. In recent years, prescription drug spending has outpaced spending for nursing home care and inpatient hospital care, becoming the No. 1 expense under the Medicaid program. To help control costs, the state in 2002 established the Drug Utilization Review Board to create and monitor a Medicaid preferred drug list. In order for a beneficiary to receive coverage for a medication that is not on the list, a physician must demonstrate to the state prescription drug manager that there is no other acceptable treatment for the beneficiary's condition. James Gray, chair of the Drug Utilization Review Board, said, "If we aren't careful about how we use our drugs, we are going to run out of money," adding, "Better to choose from drugs that are much less costly." The state in 2005 spent $14.6 million gastric acid reducers, such as Nexium. Gray said the change "is not only to control costs, but to choose the medication that is most appropriate for the problem that you are dealing with." Ann Rugg, deputy director of the Office of Vermont Health Access, said the issue of high prescription drug cost is "not unique to Vermont" and "not unique to Medicaid." She added that "clinically appropriate alternatives" to Nexium are "available at [a] lesser cost." Gastric acid reducers, along with medications for high cholesterol and mental health conditions, are the top prescription drug expenses for both Medicaid and Blue Cross Blue Shield of Vermont, the state's largest private insurer (Remsen, Burlington Free Press, 6/19).

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