Holden embraces prescription recommendations

JEFFERSON CITY, Mo. -- With a special legislative session about to begin, Gov. Bob Holden embraced recommendations Tuesday for a new state-funded, privately run prescription drug benefit for seniors.

Holden urged legislators to work with bipartisanship during the session starting today and quickly pass a bill based on the recommendations of his prescription drug task force.

"If the Legislature acts on your recommendations, we can take immediate steps to help those seniors who need it most," Holden said while receiving the task force recommendations in a sweltering outdoor ceremony.

The recommendations call for the repeal of a state income tax credit that provides up to $200 annually to senior citizens to offset some of their prescription drug costs.

Tagets those in need

In its place, the task force is recommending a program targeted only to those seniors in the greatest financial need. For seniors who pay a small enrollment fee and meet a deductible, the state would pick up 60 percent of their prescription costs up to a total of $5,000 annually.

The plan would be administered by a private contractor to be picked through a competitive application.

Lawmakers in the House and Senate said they would introduce bills based on the task force recommendations.

Republican Senate President Pro Tem Peter Kinder stood with the Democratic governor as Holden accepted and endorsed the proposals.

Kinder, of Cape Girardeau, said he was committed to passing a prescription drug bill during the specail session, but declined to endorse "every jot and tittle" of the task force recommendations.

"The concept appears to be reasonable," Kinder said.

Democratic House Speaker Jim Kreider, also present Tuesday, said his chamber would wait to debate other issues until after passing a prescription drug bill. Holden's call for the special session also includes revisions to a livestock pricing law and a state tax exemption for the federal tax refund checks being mailed this summer.

"Prescription drugs is the number one issue -- that's why we're here," said Kreider, of Nixa. "Until something gets done on that, not much is going to happen" on other bills.

The task force recommendations also include an expansion of the Medicaid health care program for the poor and disabled by increasing the income and asset limits that determine eligibility.

Lt. Gov. Joe Maxwell, who led the task force, said the Medicaid changes would cost the state nearly $9 million annually.

Costs expected to grow

The new prescription drug benefit is estimated to cost the state up to $52 million during the fiscal year that starts July 1, 2002. As more seniors join the program, the cost is projected to grow to as much as $85 million the next year.

Those projections, however, are based on low participation rates. Although the new program could apply to more than 382,000 seniors, the task force figured that fewer than one in eight would participate the first year and one in five would participate the next year.

The cost projections also include savings from a recommended requirement that pharmaceutical companies pay the state a 15 percent rebate on brand name drugs and an 11 percent rebate on generic drugs in order to have their medicines listed on the state's preferred drug list.

The recommendations were signed by 13 of the task force's 15 members. Dr. Nevada Lee of Raytown said she wanted more changes to Missouri's Medicaid program. State Sen. Marvin Singleton, who is also a doctor, raised concerns that the new program could grow to be more costly than the tax credit targeted for repeal.

When passed in 1998, the tax credit was projected to cost $20 million yearly. But that was based on faulty calculations, and the Department of Revenue initially gave the tax credit even to people who did not apply for it.

During the fiscal year that ended June 30, the tax credit cost the state $85 million.