Governor to Offer Prescription Plan

Times Staff Writer

Hoping to defuse a potential election year issue, the Schwarzenegger administration today will announce a plan to cut the price of prescription drugs for uninsured Californians.

Gov. Arnold Schwarzenegger's health and human services secretary, Kim Belshe, said she is set to release a proposal aimed at making discount prescription drugs available to up to 5 million people.

Drug manufacturers would be invited to take part in the program voluntarily. After five years, the state would give an ultimatum to companies that had not participated: Offer the discounts or face expulsion from the state's Medi-Cal health insurance program.

"The governor's proposal gives the Department of Health Services an added tool to assure that the state gets the discounts we believe are appropriate if in fact the drug companies don't deliver," Belshe said in an interview. But our hope is the hammer won't be necessary."

Schwarzenegger's proposal is due to arrive in advance of a conference at UCLA on Monday at which healthcare experts, business leaders and others are to discuss ways to drive down the cost of medical treatment.

Assembly Speaker Fabian Nunez (D-Los Angeles) is pushing a bill in the Legislature that would offer discounted prescription drugs to low-income California families. But Schwarzenegger's aides said the governor would not sign it.

One of the differences in approach is eligibility. Nunez's plan would offer discounts to more people by extending it to families of four earning as much as $66,000 a year. Schwarzenegger would offer coverage to families of four earning up to $60,000 a year.

If the Legislature were to accept amendments that reflect the way the governor would like to see the program structured, Schwarzenegger would sign it, his aides said.

Democrats interviewed Friday criticized the governor's motives. After repeatedly vetoing plans to pare the cost of prescription drugs, they said, he is coming up with a proposal in the thick of his reelection campaign against Democratic state Treasurer Phil Angelides.

Schwarzenegger vetoed Democrats' bills in 2004 and 2005 that would have helped consumers buy cheaper medicine from other countries. Last year he proposed "Cal RX," a discount program that would have been voluntary for drug makers, but it failed in the Senate.

Assemblyman Dario Frommer (D-Glendale), whose discount drug legislation was vetoed by Schwarzenegger, said the governor was "flip-flopping."

"It is another installment in the governor's reality show: 'Extreme Make-Over, Political Edition,' " Frommer said.

But he also said it would be a "good thing" if the governor went beyond voluntary measures and threatened reprisals against drug companies that refused to cut prices.

"If he is in favor of enforcement," Frommer said, "that is a good starting point."

Angelides said in a statement Friday that Schwarzenegger's proposal was inadequate.

"Crossing your fingers and waiting five years for the drug companies to lower their prices is a slap in the face to millions of Californians who are being forced every day to choose between putting food on their table and getting their prescriptions filled," he said.

But some healthcare advocates said they were pleased that the governor was embracing a plan that would not depend on voluntary compliance.

"We have not seen the language," said Anthony Wright, executive director of Health Access California, a nonprofit advocacy group. "But if the governor has come around on enforceability and accountability to the drug companies, that's an important step."

Times staff writers Nancy Vogel, Dan Morain and Jordan Rau contributed to this report.

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