State’s Authority Over Drug Coverage Upheld

A judge upheld a state law Tuesday that gives regulators the authority to tell health plans which prescription drugs they have to cover, a ruling state health officials are calling a major victory for patients.

The preliminary decision by Judge Emily Vasquez in Sacramento Superior Court is the latest in a tug of war between insurers and regulators over the 2002 state law.

At issue has been which drugs are needed by some patients -- and which are not.

Insurers had challenged regulators in court, arguing that the state should not be able to force them to pay for so-called lifestyle drugs, which would drive up their costs. Regulators said the state was obligated to ensure that seriously ill patients got the drugs they needed.

In coming weeks, the state Department of Managed Health Care will begin writing rules dictating when HMOs must pay for certain drugs. Officials said they would make a distinction between drugs such as impotency treatment Viagra and those that are essential to life and health.

“This is an important victory for the new department and, more importantly, a victory for patients,” said Daniel Zingale, the state secretary of the cabinet and former head of the Department of Managed Health Care. “What was at stake in this long battle was consumer access for lifesaving drugs for cancer, AIDS and diabetes.”

The legal challenge was brought by Blue Shield of California, which said it should not have to pay for the weight-loss drug Xenical to treat a morbidly obese patient. The state said her condition was a matter of life or death. The judge initially agreed with Blue Shield, then changed her mind when the Legislature more specifically gave regulators the ability to oversee coverage of prescription drugs.

The insurer declined to comment beyond a short statement Tuesday thanking Vasquez for agreeing to reconsider the decision -- although regulators consider a reversal unlikely.

Zingale said the need for a medication varies by the patient, so HMOs should make coverage decisions on a case-by-case basis. He used the example of allergy drugs, which for some people simply provide relief from an annoying condition. But for asthmatics, he said, such drugs can be lifesaving.

He said that the state may now require HMOs to cover allergy medicines for asthmatics, but not for everyday suffers of hay fever. Also, he said that some drugs now deemed nonessential may later prove effective for serious conditions and that the law should provide flexibility in such instances.

“A drug that treats one condition today may be a lifesaving one tomorrow,” Zingale said.