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CMS Advises Medicaid Officials to Adopt Measures That Do Not Restrict Access to Psychiatric Medications

August 30, 2004

On August 20, 2004, the Centers for Medicare and Medicaid Services (CMS) issued a Technical Assistance Paper – "Psychotropic Medications: Addressing Costs without Restricting Access." CMS supports several state efforts to control the escalation in prescription drug costs while maintaining access to newer, effective medications.

CMS has prepared and circulated this report to state Medicaid Directors and Regional CMS Medicaid Administrators addressing strategies to contain the costs of prescribing psychiatric medications without compromising quality or limiting access. We believe that this report can prove to be an effective tool in the ongoing advocacy fight to prevent restrictive formularies, fail first policies, and related cost containment efforts that compromise quality of care.

The paper reviews the efficacy of the newer psychotropic medications (atypicals and SSRIs) and expresses concern that cost and demand management techniques, such as prior authorization and targeted utilization review, "can limit access to the most effective treatment for a specific individual, and have a negative effect on quality."

The report goes on to describe three innovative strategies for managing costs without compromising quality, specifically:

1. The Pennsylvania and Missouri (CNS) educational and management programs,

2. TMAP, and

3. The Massachusetts polypharmacy initiative

The document may be accessed under "Mental Health Under the President’s New Freedom Initiative" either through the New Freedom Initiative web page or through the CMS Promising Practices web page.

This paper is the first in a series that CMS anticipates issuing to states. According to CMS, the papers represents efforts by CMS to work with other federal agencies to further the Administration’s goal of maximizing opportunities for persons with disabilities and reducing the use of institutional settings.

We are strongly encouraging that NAMI advocates use this document in meetings with Medicaid officials and representatives of the Governor to support voluntary alternative utilization management strategies that have a proven track record, rather than initiating restrictive utilization and cost management strategies such as fail first approaches and prior authorization programs.

For more information about the CMS report, please contact Joel Miller, Acting Director, Policy Research Institute at 703-600-1109,, or Steve Buck, Director of State Relations,, 405-749-1366.