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Cost of drugs limits use by some AIDS patients HMOs, states restrict amount they will pay


WASHINGTON -- Even though new drugs show great promise in combating AIDS, many patients are finding they cannot easily get the costly medicines because of restrictions imposed by health maintenance organizations and by state programs set up to assist people with low incomes.

Some HMOs say they limit pharmacy benefits to a specified amount -- $3,000 a year per patient is typical.

That is far less than the cost of the drug combinations often recommended by doctors. These regimens, some of which combine new protease inhibitor drugs with older antiviral medications, can easily cost $10,000 to $15,000 a year, and doctors say AIDS patients may need to take the drugs indefinitely.

In research reported in the past year, the drug combinations appear to be highly effective in suppressing HIV, the virus that causes AIDS, and in improving patients' health. These reports have raised hopes and generated a huge increase in demand for the drugs, surpassing the expectations of drug manufacturers, private health plans and AIDS drug assistance programs financed by federal and state authorities.

Experience with the new AIDS drugs may foreshadow the difficult trade-offs that await taxpayers and policy-makers as scientists develop costly treatments for other diseases such as cancer or Alzheimer's.

U.S. raises assistance

Each state has a drug assistance program to provide prescription drugs to low-income people who are not covered by private health insurance or Medicaid. At President Clinton's insistence, the federal government has sharply increased its contribution to these programs and will provide 85 percent of the $300 million they spend in the coming year. But in interviews, officials in several states said the money was still not enough to meet the demand for the new drugs.

The AIDS drug assistance programs in Arkansas, Nevada, South Dakota and Oregon do not cover any of the protease inhibitors, which block reproduction of the AIDS virus.

In Colorado, the AIDS drug program ran out of money Dec. 10, 3 1/2 months before the end of the fiscal year. "Because the medicines were so new, we had no idea what the demand would be," said Pamela R. Snyder, the program director.

Illinois officials tightened the eligibility criteria and reduced the list of approved drugs to 28, from 112, so they would not run out of money. The state covers one of the three protease inhibitors. Thomas J. Schafer, a spokesman for the Illinois Department of Public Health, said the state would soon impose an annual limit, perhaps $12,000 for each person receiving AIDS drugs through the program.

The Florida Health Department, which just added the protease medications to its list of approved drugs, is getting $24 million of federal money this year, up from $17 million last year. But David W. Poole, chief of AIDS patient care at the department, said, "We anticipate needing many more dollars."

Fewer problems in New York

New York, with more AIDS cases than any other state, has the nation's most comprehensive drug assistance program. It serves 10,000 people and covers more than 200 drugs, but it has avoided most of the financial problems seen elsewhere. New York receives a large amount of federal money, $70 million in the coming year. In addition, unlike about 20 states that rely entirely on federal grants, New York contributes $12 million of state money, derived from a tax on health insurers.

The limits imposed by HMOs on pharmacy benefits are not explicitly directed at people with AIDS but affect them more than others.

Ronald D. Wackett, the pharmacy director at Mid Atlantic Medical Services, a managed care company in the Washington area, said its health plans often set annual limits on drug coverage at $2,000 or $3,000 a person.

Michael H. Savage, a spokesman for Mid Atlantic, said that if people with AIDS needed drugs beyond that limit, "they are pretty much on their own." Moreover, he said: "It is not the HMO imposing the limit. The employer purchasing the health plan chooses the benefit levels that he or she wishes to offer employees."

A psychiatric social worker with AIDS who is employed by the New York state government, and who did not want to be identified, said he had spent a full week negotiating with a pharmacy, an insurance company and a drug manufacturer over who would pay for a protease inhibitor that he began taking last April.

"It was an incredible hassle," he said. "My body was wasting away. I was desperate. But the drug has been a savior. It's bought a year of life for me."

Doctors say it is extremely important for people with the AIDS virus to take their drugs exactly as prescribed. Interruption of the therapy can promote the emergence of a resistant strain of HIV.

The Food and Drug Administration has approved three protease inhibitors: Invirase, made by Roche Laboratories; Crixivan, by Merck & Company; and Norvir, by Abbott Laboratories.

The manufacturers all have programs to provide the drugs free, as a last resort, to patients who have no health insurance or experience gaps in coverage. But the logistics of these arrangements can be complex.

Several studies suggest that the protease inhibitors, though expensive, may cut the cost of treating AIDS by reducing the need for hospital care, home health care and other services. "The studies suggest that overall costs will come down, but we don't have enough information to document that in our plan," said Mohan Vodoor, a vice president of the Health Insurance Plan of Greater New York, an HMO.

Medicaid helps finance health care for more than half of all people with AIDS. Sally K. Richardson, deputy administrator of the federal Health Care Financing Administration, recently told state Medicaid officials they must cover the three protease inhibitors.

In his new budget, Clinton proposed limits on federal Medicaid spending. People with AIDS and state officials strenuously oppose such limits, saying they would threaten access to promising AIDS drug therapies.

The drugs' high cost has prompted Medicaid officials in Arizona to develop a special reimbursement rate for people with AIDS. The state's Medicaid program pays HMOs an average of $150 a month for each Medicaid recipient.

But Frank Lopez, a spokesman for the Arizona Medicaid program, said the state was planning to pay $800 to $1,000 a month for a person with AIDS. Maryland and New York are also developing special rates for people with AIDS.

Pub Date: 2/16/97

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