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To: Anthony Wong who wrote (451)	7/2/1998 1:13:00 PM
From: Anthony Wong	Read Replies (1) \| Respond to of 1722

Medicaid Programs Told To Pay For Viagra But Monitoring Continues July 02, 1998 1:04 AM By Laurie McGinley, Staff Reporter of The Wall Street Journal WASHINGTON -- Federal health officials are notifying states that their Medicaid programs must pay for Viagra, but they may eventually drop the requirement if a new monitoring system shows the drug "is subject to clinical abuse or inappropriate use." The new federal policy is outlined in a letter from Nancy-Ann DeParle, the administrator of the Health Care Financing Administration, to Govs. Lawton Chiles of Florida and Michael Leavitt of Utah. Ms. DeParle's letter, which is to go to the governors today, is a response to a May letter from the governors in which they argued that the states should decide whether Medicaid covered the high-priced impotence drug. Ms. DeParle told the governors that, with few exceptions, federal law requires that Medicaid, the state-federal health program for the poor and disabled, cover federally approved drugs prescribed for medically approved uses. But, she said, the law allows federal officials to exempt certain drugs after determining, based on evidence from the states, that the medications are being abused or improperly used. Health and Human Services Secretary Donna Shalala "is greatly concerned about the potential for clinical or financial abuse of Viagra," Ms. DeParle wrote. Therefore, HCFA will set up "a rigorous system," which will include state officials, physicians and consumer advocates, to monitor Viagra's use, she said. The goal will be to determine whether Pfizer Inc.'s blockbuster drug should be placed on the list of drugs that don't have to be covered by Medicaid. Currently, fertility, baldness and smoking-cessation drugs are among those on the list of exempt medications. In the meantime, Ms. DeParle urged state officials to strongly consider imposing restrictions on Viagra "to ensure appropriate use and cost efficiencies." Those include limiting the number of refills or the number of pills in each prescription; establishing prior-authorization programs to ensure that physicians prescribe the drug correctly and disciplining doctors who prescribe Viagra when not medically necessary. The federal directive is sure to disappoint the governors, who warned in their May letter that hot-selling Viagra could increase Medicaid costs by $100 million a year. That estimate has been greeted with some skepticism by the Clinton administration, although no one has a good estimate of the drug's costs. Of the 37 million people enrolled in Medicaid, only about four million are men, and only a small subset would be interested in the drug. Medicare, the program for the 39 million elderly and disabled, doesn't cover prescription drugs. The states, while awaiting federal guidance on whether their Medicaid programs must cover Viagra, have reacted in different ways. South Carolina, Virginia and Tennessee have declined to cover the drug, while Arkansas, Alabama, Florida and Texas are paying for it, though with some restrictions. Some big health insurers, such as Kaiser Permanente, have also decided against covering Viagra. The question of adverse drug interactions, especially with some heart medications, also has raised some questions about the drug. But some consumer advocates have protested coverage restrictions, saying that the drug allows men who have had prostate cancer and spinal-cord injuries to resume normal sex lives. Copyright (c) 1998 Dow Jones & Company, Inc. All Rights Reserved.