Evaluation of State Prescription Drug Programs:
Lessons for Medicare

Increasing seniors' access to prescription drugs is a top policy priority for the American people, the Administration, and members of Congress. Both parties have proposed legislation that would add a prescription-drug component to Medicare, albeit with very different structures. Many questions about the design and implementation of a Medicare drug benefit need to be answered.

States have been administering public prescription drug programs in some form since 1975. Their experiences with various program designs can provide valuable information to federal policymakers designing a drug benefit. To assess how states have expanded access to prescription drugs while trying to control costs, The Robert Wood Johnson Foundation's Changes in Health Care Financing and Organization (HCFO) program convened a small meeting of state and federal policymakers, researchers, and analysts. The participants generated many important questions. Therefore, through this special topic solicitation, the HCFO program encourages research assessing the effect of state prescription drug programs on costs and access to care and on the implications of these programs for Medicare.

Although we are interested in evaluating state programs themselves, we are hoping to solicit proposals that would relate lessons learned from these evaluations to the design and implementation of a Medicare drug benefit. Thus, the proposed findings from these projects should be put in the context of implications for Medicare, including:

• The effect of implementing similar design elements on beneficiary access, out-of-pocket costs, and the cost to public payors;
  
• The effect on the private market, including drug company costs, research and development, and pharmacy benefit managers; and,
  
• The degree to which adopting certain program elements would mean a fundamental change in Medicare's structure (e.g., introducing a means-testing component into a program that was heretofore an entitlement program).

The following questions are intended to suggest the types of issues we are interested in funding. They are not meant to be a complete list. Moreover, each question does not necessarily represent a stand-alone research project. Projects submitted under this solicitation should follow the regular HCFO application instructions.

• What have states done to expand access to prescription drugs?
  
• How have states been able to control costs?
  
• Which mechanisms have been most effective at expanding access while controlling costs?
  
• How has participation in state programs been affected by different components of program design and operation (e.g. eligibility determination, cost sharing, means testing, formulary structure)?
  
• How do beneficiaries' out-of-pocket costs vary with the interventions that have been tried?
  
• How do a state's program design and operation affect utilization of prescription drugs and other health care services?
  
• What has been the experience of private discount card programs administered by pharmaceutical companies? Who enrolled in these programs?
  
• How do private discount card programs affect consumers' utilization, cost, and access?
  
• How do state programs and private discount cards affect drug companies (e.g. costs, research, and development budgets)?
  
• What effect do they have on overall prescription drug costs?
  
• How do the design and operation of state programs and private discount cards affect physicians' prescribing patterns?