Drug Prices, Senior Programs May Deliver Blow to State Budgets

Higher prescription drug prices, combined with changes to Medicare and Social Security, could deal a $1.6 billion blow to state budgets next year by forcing them to ratchet up spending on Medicaid, the federal-state health care program for the poor.  Without congressional intervention, most state Medicaid agencies will have to come up with tens of millions of dollars to cover the bill.  The new costs could prompt states to tighten eligibility requirements or cut benefits. They could, for example, reduce dental benefits under Medicaid, which they aren’t required to offer, or shift more prescription drug costs to patients. They also could cut payments to doctors, which might prompt more providers to stop treating Medicaid patients.