Pharmacy expenditures are the fastest-growing element of Utah's Medac program, members of the Legislature's Medicaid Interim Committee were told in a Friday meeting. The committee is discussing the future of the expensive state program.

Cathy Dupont, legislative general counsel spokeswoman, told the legislators that pharmaceutical costs are the fastest-escalating factor in health care for Utah's poor and elderly.

The meeting was a time for senators and representatives to be educated by experts and leaders in the pharmacy business and Utah Department of Health representatives.

One issue discussed at length was the Deficit Reduction Act of 2005, which "mandated Medicaid pharmacy reimbursement for generic drugs to switch from average wholesale price to average manufacturer price," according to the Utah Pharmaceutical Association. The act is to be implemented this October and is expected to make its mark on pharmacies throughout Utah by January.

"Because of this change, it's very possible that several of our Utah pharmacies will not be able to keep their doors open," said Reid Barker, executive director of the Utah Pharmacists Association. "The reimbursement that they receive for Medicaid would be too low."

Pharmacies in rural areas, where up to 40 percent of the business can come from Medicaid patients, would suffer the most under the mandate. If the doors closed in those areas, Medicaid patients could end up in the emergency room because of limited access to pharmacies, he said.

The solution Barker and others from the association presented to the Medicaid committee was to create a hold-harmless proviso, something that has already been adopted in both Kansas and Iowa. The proviso would shift the expenditures from the ingredient cost to the dispensing fee, keeping the pharmacies in a "tolerable" condition, said Salt Lake pharmacist Dean Jolley.

Committee chairman Sen. Allen Christensen, R-North Ogden, said of the issue, "this isn't the end of this discussion."

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