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2001 Law.com
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Carol Wright
Miami Daily Business Review

April 9, 2001


A cadre of influential state senators from South Florida is pushing a bill that would expand prescription drug benefits for the elderly. Pharmacists, however, say the increase in benefits could put them out of business.

Tom Rossin, D-West Palm Beach, leader of the Senate Democrats, is sponsoring the measure, which came out of the Health, Aging and Long-Term Care Committee in the Florida Senate.

The Florida Legislature established a program last year with $15 million. About 30,000 people in Florida make use of the benefits. The assistance program helps low-income elderly or disabled people whose prescription drug expenses fall between the cracks of Medicare and Medicaid coverage.

Rossin's bill is one of several variations in the Florida House and Senate this session on the discount drugs theme. But it is the bill that carries the most clout, says one legislative insider who asked not to be identified. While the money needed to fund the program's expansion isn't in the Senate's $48 billion budget, "there's a lot of horsepower in that group of senators."

Florida is one of more than 20 states to establish some form of subsidy to help seniors pay for outpatient prescription drugs.

Florida limits benefits to $80 a month. Rossin's bill would up that to $150 a month and raise the income eligibility level from 120 percent to 150 percent of the federal poverty line. Pharmacists are watching the bill closely, arguing that increasing the benefits could put them out of business.

Some pharmacists say the proposal is no better than price fixing.

"This all boils down to a ceiling being placed on the cost of prescriptions," said Michael Jackson, executive vice president of the Florida Pharmacy Association in Tallahassee. The FPA counts 3,343 pharmacists as members. There are about 20,000 Florida licensed pharmacists.

Another provision in Rossin's bill cuts out a requirement that now limits the program to Medicaid participants. If that amendment remains intact, 100,000 people could become eligible for the program, the committee estimates.

Rossin's bill would add $259.2 million a year to Florida's Medicaid budget, which already is operating $1 billion in the red. That's why few in Tallahassee give the bill much chance in this cut-spending-to-the-bone session.

But the bill isn't buried yet. Rossin has won the support of other veteran Democratic legislators in the state Senate, including Boca Raton's Ron Klein and Broward County state Sens. Steve Geller from Hallandale Beach and Tamarac's Walter G. "Skip" Campbell Jr.

Klein and Campbell are on the health care committee, along with South Florida Democratic Sens. Debbie Wasserman Schultz from Pembroke Pines and Fort Lauderdale's M. Mandy Dawson, who serves as vice chair.

The committee acknowledges that some pharmacists would see a drop in profits from the sales of certain outpatient prescription medicines. However, the committee predicts that any loss in profits would be offset from increased sales to the additional customers.

Jackson is skeptical of that prediction. "Increasing the number of participants means there may be individuals currently doing business with a pharmacy who will become eligible to receive this assistance," he said. "What you're doing is expanding the number of patients eligible for this program to people who have too much money to qualify for Medicaid."

The committee report warns that pharmacies and drug manufacturers would increase prices for people without benefits to make up for any profit drop.

"That's probably correct," Jackson said. There's a cap on certain segments of the prescription market. Typically 70 percent of a pharmacy's business is through some sort of managed health care program such as an HMO or Medicare, he said. Those plans dictate what type of reimbursement the pharmacy can get. The rest consists of free-market, cash customers.

"They're taking that 30 percent of free-market customers and adding further caps to some of that business," Jackson said. "And that's what a pharmacist may say is price fixing."

A companion bill in the Florida House is sponsored by Rep. Susan Bucher. The Democrat from West Palm Beach is on her first term, but she has more savvy than most freshman legislators because she was an aide to the late Rep. Ed Healey for several years.

But Bucher is not optimistic about the bill making it through the maze of committees it has to hurdle, even though she sits on one of them in the House, the Health Promotion Committee.

"We all campaigned on this issue, Democrats and Republicans, but there's not a lot of emphasis in the House on it and I can't get my chairman [Republican Rep. Ken Litttlefield from Zephyrhills] to move it."

Last month, the Florida Senate's bipartisan health care committee of six Republicans and five Democrats unanimously passed the bill. It's now in a holding pattern with the Governmental Oversight and Productivity Committee in the Senate.

And while Rossin's bill is moving, "if mine dies, his dies," Bucher said. In that case, the best chance to get the job done is to add proviso language to the budget.

That strategy has a lot of "ifs" to it.

The Florida House budget is $53.5 billion, the Senate's $47.8 billion. The two chambers have to work out a single budget before the session ends May 4. That task is done through conference committees.

"If they don't pass a tax break bill, we'll have $355 million to add to the budget," Bucher said.

Given that scenario, the conferees could add proviso language that would in effect change the eligibility requirements. "So the content of our bills would be in the budget.

Legislators funded the program last year with $15 million. That was doubled under Gov. Jeb Bush's executive budget by tapping the Tobacco Settlement Trust Fund.

Ideally the FPA wants to bundle the various bills into a single package. "We're actively working with Sen. Rossin to come up with a consensus to provide some relief to our seniors and yet not put pharmacists out of business," Jackson said.

2001 Law.com
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