Massachusetts' approach to governing pharmacy benefits in its Medicaid program is an example of how access to psychiatric medications can be managed in a clinically informed, ethically justifiable, and potentially politically acceptable manner. Over the past 18 months Massachusetts has engaged the key stakeholders in debate and deliberation about how to maintain access to psychiatric medications and to set limits fairly. The experience in Massachusetts offers practical guidance to other states and, more broadly, to private pharmacy benefit plans.
Pharmacy benefits will be a central focus for managed behavioral care over the next decade. The clinical value of advances in psychopharmacology are dramatically clear, but so is the impact of drug costs on strained public and private budgets. The continuing absence of a Medicare drug benefit demonstrates that access—and health—will suffer unless agreement can be reached on ways of containing costs. Paradoxically, to promote the widest possible access to needed medications, clinicians, patients, and concerned families must embrace the need for limits (1). We have proposed an "ethical template" to guide the limit-setting process (2).
This column, the first in a series about psychiatric drug benefits in a managed care context, draws on interviews with participants in the Massachusetts process as well as the opportunity that one of us (JES) has had to observe the process closely. The series will seek to identify practical lessons about strategies that promote access, quality, and acceptable cost trends.
The approach used in Massachusetts is based on an understanding that pluralistic societies have no widely shared principles from which public officials can deduce fair and acceptable limits (3). It is not possible for a small group of people to go into a closed room, decide about limits by applying principles, inform stakeholders of the results, and expect cooperation. In Massachusetts it was concluded that to meet progressively tighter budgets while maintaining a focus on patients' needs and clinical quality, public officials would need to create a process that enlisted organized psychiatry, consumers, and family members in developing and implementing Medicaid pharmacy limits.
The widely publicized experience with the Medicaid pharmacy benefit in Michigan, described most fully in a report from the Kaiser Commission on Medicaid and the Uninsured (4), provided cautionary guidance. In 2001 the Michigan legislature set an ambitious Medicaid pharmacy savings target and a short timetable for achieving it. The governor appointed a ten-member committee of physicians and pharmacists and charged this committee with creating a list of preferred drugs. The committee moved extraordinarily rapidly, creating in one month a preferred-drug list and prior-authorization requirements for 44 classes of drugs.
Not surprisingly, top-down management and rapid implementation led to widespread misunderstanding, resistance, litigation, and what the Kaiser Commission described as disorganization and chaos. The commission commented that "stakeholders were not given an opportunity to raise issues up-front or shape the development of approaches responsive to the interests of the beneficiary community and others" and concluded that future efforts to manage pharmacy benefits should "give beneficiaries and other stakeholders the opportunity to express their positions and to participate more fully in the policymaking process."
In contrast, the hub of the policy-making process in Massachusetts was a psychopharmacology work group chaired by the Medicaid medical director, Dr. Annette Hanson, who happens to be a psychiatrist. Four members of the Massachusetts Psychiatric Society who have expertise in psychopharmacology and extensive clinical experience in high-volume practice settings, including the current president and a past-president, are active participants. The work group is not a venue in which passive "participants" receive intermittent reports of a fait accompli. Proposals are presented, debated, and modified, and the discussion continues through vigorous e-mail exchanges between meetings. The group meets no less than once a month, often meeting weekly.
The psychopharmacology group is limited to psychiatrists and pharmacists. When the Massachusetts chapter of the National Alliance for the Mentally Ill (NAMI) asked for representation in the group, it was told that it could appoint a psychiatrist. The state NAMI chapter designated a psychiatrist member of its board of directors. In addition, the chapter's executive director reports having ready access to Dr. Hanson, with whom he maintains frequent contact.
Similarly, when consumer activists asked to be part of the psychopharmacology group, they were invited to identify a psychiatrist to represent them. They designated a psychiatrist who works closely with the Medicaid Consumer Advisory Council to present consumer concerns to the psychopharmacology group and report back regularly to the Medicaid Consumer Council.
Massachusetts initially applied an educational strategy in its effort to manage Medicaid pharmacy expenditures (5). The psychopharmacology group targeted practices that were costly and had minimal or no evidentiary base, including the coprescribing of more than one selective serotonin reuptake inhibitor or atypical antipsychotic for more than 60 days and concomitant prescribing of five or more psychiatric medications. An educational letter was sent to all Massachusetts psychiatrists, followed by a personalized letter to the 75 most frequent users of these practices. The Massachusetts Psychiatric Society presented a continuing medical education conference on polypharmacy. Follow-up six months later showed substantial change, with the potential for improving clinical practice and saving $5 to $10 million per year (6).
Unfortunately, Massachusetts tax revenues continued to drop, and the savings achievable by educational methods were not adequate in the face of a growing deficit. In January 2003 the Massachusetts Division of Medical Assistance was directed to seek substantially greater savings from the pharmacy budget. Dr. Hanson explained the new financial situation to the psychopharmacology group and asked for its help. Group members recognized that although, as citizens, they were free to lobby for increased taxes or a shifting of cuts to other sectors of the state budget, if the psychopharmacology group did not manage the fiscal imperative, bureaucrats would do it.
Faced with requests to help develop a preferred-drug list, the representatives from the Massachusetts Psychiatric Society had to decide whether to withdraw from the psychopharmacology work group in order to uphold the American Psychiatric Association's (APA's) position that psychiatric medications should be exempted from formulary limits and prior-approval programs, irrespective of Medicaid budgetary pressures. They elected to continue to be involved in the limit-setting process. Dr. Elizabeth Childs, the psychiatric society's president, explained that "in light of the state's budget crisis, it seemed naive and counterproductive to take a position that psychotropic drugs should be unaffected by the establishment of a preferred drug list" (6). President-elect Dr. James Ellison added that failure to constrain psychiatric medication expenditures would threaten withdrawal of funding from community treatment programs, nonpsychiatric programs such as services to patients with HIV infection, and access to Medicaid itself (7).
The inclusion of the perspectives of the Massachusetts Psychiatric Society, consumers, and family members in the pharmacy benefit management process resulted in a number of policy changes. For example, although psychiatrists, consumers, and family advocates could accept the designation of generic fluoxetine as the preferred selective serotonin reuptake inhibitor for initial prescriptions, they were concerned about changing stable regimens for patients who were doing well with "nonpreferred" medications. Medicaid agreed that patients who had been treated successfully with other antidepressants for at least six months with no hospitalizations would not need prior authorization to continue.
In addition, Wellbutrin SR, although nongeneric, was added to the list of antidepressants not requiring prior authorization in order to provide an easily available option for patients who needed an alternative to serotonergic medication. The rationale for including the nongeneric medication was that this slow-release form of bupropion is less likely to increase the risk of seizure compared with the available generic product, bupropion IR.
As another example, although Medicaid "does not consider olanzapine as first-line treatment . . . due to its side effect profile and cost" (8), prior authorization is required for atypical antipsychotics only when dosages fall outside of specified ranges, such as more than 6 mg of risperidone per day or more than 20 mg of olanzapine per day. Prior authorization is not required for generic clozapine for monotherapy or when prescribed with a second antipsychotic, opening the door to supplementing clozapine at the prescribing physician's discretion.
In addition, the prior-authorization process was made substantially simpler, with fewer documentation requirements than originally proposed.
Finally, the Massachusetts Division of Medical Assistance and the state mental health department officially acknowledged and adopted the psychiatric society's position statement about formulary development (9). The statement asserted the primacy of the prescriber-patient relationship and required Medicaid to hire a psychopharmacologist to review all rejected prior-authorization requests.
With exemplary leadership from the Medicaid medical director—a psychiatrist—Massachusetts has orchestrated a limit-setting process for managing psychiatric drug benefits in its Medicaid program with unusually robust stakeholder participation. Policy deliberation included careful attention to clinical expertise, consumer and family concerns about the well-being of individual patients, the state's fiscal requirements, and the impact of prior-authorization policies on practicing psychiatrists. Interim results suggest that stakeholders' participation has improved the state's limit-setting policies and has thus far resulted in a relatively cooperative, litigation-free implementation process.
Medicaid's readiness to listen to expert advice made it easier for the Massachusetts Psychiatric Society to diverge from APA's opposition to any curtailment of physician prescribing. Reciprocally, the psychiatric society's flexibility made it easier for Medicaid to bring psychiatrists and other stakeholders into the decision-making process. Similarly, although NAMI advocates for a policy of free access, it is working with the state to create the best clinical approaches in the context of the available funds.
If Massachusetts' budget deficit continues to grow, public officials will be pressured to take more draconian steps. It remains to be seen whether the state could continue its cooperative approach to limit setting in circumstances of even greater fiscal urgency. However, experience to date suggests that transparency about the key parameters of policy, deliberation that includes strong representation of clinical expertise and consumer and family perspectives, and a readiness to revise policy positions in accord with new evidence provides a promising approach to setting limits fairly.
The authors thank John DeLuca, Ken Duckworth, James Ellison, Nan Ferris, Toby Fisher, Annette Hanson, Lee-Anne Jacobs, David Osser, Charles Sweet, and Russell Teagarden.
Dr. Sabin, who is editor of this column, is clinical professor of psychiatry at Harvard Medical School and director of the ethics program at Harvard Pilgrim Health Care in Boston. Dr. Daniels is professor of ethics and population health in the department of population and international health at the Harvard School of Public Health. Send correspondence to Dr. Sabin at the Department of Ambulatory Care and Prevention, 133 Brookline Avenue, Sixth Floor, Boston, Massachusetts 02215 (e-mail, firstname.lastname@example.org).