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MEDICAID COVERAGE INCREASE FOR RETROVIR, NEBUPENT, DIFLUCAN

Executive Summary

MEDICAID COVERAGE INCREASE FOR RETROVIR, NEBUPENT, DIFLUCAN would be provided for HIV-positive individuals under a bill introduced by Rep. Waxman (D-Calif.) Feb. 22. HR 4080 would expand Medicaid eligibility of low-income individuals infected with the HIV virus to provide reimbursement for drugs prescribed for the treatment or prevention of opportunistic diseases related to AIDS. Drugs covered by the bill would include Burroughs Wellcome's Retrovir (AZT), Lyphomed's Nebupent (aerosolized pentamidine) and Pfizer's Diflucan (fluconazole). Waxman's bill was supported by former Surgeon General C. Everett Koop, MD, at a Feb. 27 hearing before the House Energy & Commerce/Health Subcommittee, which Waxman chairs. "We must keep the infected from infecting others," Koop said. "And where possible, we must postpone the onset of opportunistic disease and treat it in settings other than acute care hospitals." Medicaid does not currently cover the cost of "early intervention" drugs and services for HIV-infected people with no symptoms or with AIDS-related complex. HR 4080 would additionally expand Medicaid coverage to HIV-infected individuals for physicians' services, outpatient hospital services, rural health clinic services and federally-qualified health center services; lab services; clinic services; and case management services. The legislation would require states to increase payments for inpatient services to hospitals serving high volumes of Medicaid-eligible AIDS patients. The payment adjustment would have to equal at least 25% of the amount the hospital would otherwise be paid. The bill would also provide federal Medicaid assistance for premiums for continued "COBRA" insurance coverage for HIV-positive individuals and provide for expanded Medicaid funding for home or community-based services to children with AIDS. "Persons with AIDS need help," Koop said. "They need it physically and financially. Hospitals that have a disproportionate caseload of AIDS need help as well. And an alternative to hospital care for AIDS babies, especially those abandoned, must be found." He continued: "Mr. Chairman, much of what I have said this morning, I have said over and over again for the last five years. My concerns expressed this morning have yet to be addressed on the national level. Unless there is congressional intervention the situation can only get worse." In response to a question from Rep. Howard Nielson (R-Utah), Koop agreed that the bill might set a precedent for expanded eligibility under Medicaid. However, Koop contended that early treatment intervention for HIV-infected individuals would end up saving government funds in the long run. "You're dealing with a very unique situation," he said, "and if the patients you're talking about could be kept active and independent, there is a savings of funds from whatever sources you find later on...From where I sit, it seems that that is the reasonable way to go, perhaps the only way to go." Another witness at the hearing presented statistical data on expected increases in Medicaid spending for AIDS patients. Kenneth Thorpe, PhD, director of the Program on Health Care Financing and Insurance at the Harvard School of Public Health, predicted that "Medicaid costs of treating [people with AIDS] will double between 1990 and 1993, rising to $3.7 bil. As a result, costs of treating AIDS patients would rise from 2.7% to 4.5% of total Medicaid spending." Waxman is planning to attach his bill to budget reconciliation legislation developed by the Energy & Commerce Committee. As an alternative, Waxman is reportedly considering including the provision on "early intervention" drugs and services to another bill he is developing on AIDS counseling, testing and diagnoses. The bill is expected to be introduced within the next two weeks and Waxman will hold another hearing when it is introduced.
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