Against the advice of the Bush administration, the U.S. Supreme Court has agreed to hear a case involving a controversial Maine program to provide discounted prescription drugs to low-income residents. The court's decision ultimately could determine how far states may go in extracting price discounts from drugmakers.
An October 2000 injunction has kept state officials from implementing the MaineRx program while the case is being heard, and at no time since the law establishing MaineRx passed in May 2000 has the program been operative, officials said. Under it, Maine would act as a pharmacy benefit manager for residents without prescription-drug coverage and negotiate price rebates from drugmakers. The law authorizes price controls if negotiations are insufficient.
In accepting the case, the Justices rejected the advice of U.S. Solicitor General Theodore Olson that the initiative should be allowed to go forward without further intervention. Olson argued that states "enjoy a broad measure of flexibility in tailoring the scope and coverage of their (Medicaid) plans" and that court review of MaineRx was not warranted. MaineRx would represent an expansion of the state Medicaid program.
The high court won't hear arguments in the case until at least October, officials said.
Viewed by many as a landmark effort with consequences for other states, MaineRx has not been popular with the drug industry, which contends the program violates federal Medicaid law and the commerce clause of the U.S. Constitution.
The Pharmaceutical Researchers and Manufacturers of America-the trade group for drug manufacturers-appealed to the Supreme Court after the 1st U.S. Circuit Court of Appeals in Boston rejected its challenge of the law.
In deciding to hear the case, "the Supreme Court has recognized the importance of the issues," PhRMA said in a written statement. "The MaineRx program would have dire consequences for the state's most vulnerable citizens. The program would have limited Medicaid patients' access to the newest and most effective medication."
Supporters said they hoped the high court would not hand down a death sentence for MaineRx. The Supreme Court's decision to hear the case is "disappointing because we believe we're constitutionally on the right side," said Chellie Pingree, the former state senator who introduced the MaineRx law and now is a candidate for U.S. Senate.
The Justices also accepted a case that could determine whether health plans can legally maintain closed provider networks to contain costs. The case, Kentucky Association of Health Plans v. Miller, involves an 8-year-old Kentucky law requiring health plans to open their networks.