National Alliance on Mental Illness
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NAMI POLICY RESEARCH INSTITUTE
STATE ACTION ALERT
February 21, 2003
MEDICAID PRIOR AUTHORIZATION PROGRAMS:
A GUIDE FOR ADVOCATES
The combination of a preferred drug formulary with prior authorization programs for all non-listed drugs within a state’s Medicaid program is a dangerous proposition for persons with mental illnesses. These programs have the potential to further erode a very tenuous community system of care. Recovery is at risk when Medicaid prior authorization programs make if difficult to obtain needed drugs.
It is critically important for advocates to educate Medicaid directors, and other public officials about the serious consequences of limiting access to medications which is central to the recovery of persons with mental illness. Advocates must highlight that rising Medicaid pharmacy costs be understood as part of the larger picture – dramatic reductions in hospitalizations and criminalization result from access to effective medications.
It is clear, based on presentations to the NAMI Task Force on Access to Medications, that Medicaid prior authorization programs are high risk cost containment strategies and they are not an effective management strategy based on private sector experience. Based on data from Florida that was collected in April 2002, about 35,000 people who sought medications left the pharmacy without filling their prescriptions. It is estimated that nearly one-third of those consumers never received their medications. Another 22,000 people received a different medication or less than the amount prescribed.
It is clear to NAMI that the consequences for people with severe mental illness will be devastating in Florida and other states if Medicaid prior authorization programs and fail-first strategies become more commonplace. Prior authorization programs may help state Medicaid programs control their budgets in the short term, but unintended consequences such as increases in the costs of hospitalization and incarceration in the criminal justice system will offset any savings.
It is critically important that NAMI organizations oppose in all cases the imposition of prior authorization programs that include medications to treat mental illness.
Key Statistical Talking Points for Advocates
The indirect costs and consequences of not supporting mental illness recovery are clear and must be considered even in times of state fiscal pressures. The costs of not treating consumers with serious mental illnesses will make it even more difficult for states to control costs due to increased hospitalizations and more ER and physician visits.
Policymakers must be informed that the newer, more effective medications make a tremendous difference and that access denied is a threat to the state in human and economic terms.