The Health Resources and Services Administration (HRSA), an agency of the Department of Health and Human Services, administers the Ryan White Comprehensive AIDS Resources Emergency (CARE) Act. Enacted in 1990 and reauthorized in 1996 and again in 2000, the CARE Act is the largest source of Federal funding specifically directed to provide primary care and support services for low-income, uninsured, and under-insured persons living with HIV disease.
Under Title II of the CARE Act, formula grants are awarded to States and eligible U.S. Territories to improve the quality, availability, and organization of HIV health care and support services. In addition to other specific service programs, Title II funds AIDS Drug Assistance Programs (ADAPs). ADAPs provide medications to low-income individuals with HIV disease who have limited or no coverage from private insurance or Medicaid, in all 50 States, the District of Columbia, Puerto Rico, the Virgin Islands, and Guam.
In 2000, States project that approximately 125,800 individuals with HIV disease who have limited or no coverage from private insurance or Medicaid will access ADAPs. In any given month, ADAPs anticipate serving 73,000 people.
Title II requires that: "A State shall use a portion of the amounts provided to establish a program . . . to provide therapeutics to treat HIV disease or prevent serious deterioration of health arising from HIV disease in eligible individuals, including measures for the prevention and treatment of opportunistic infections."
ADAPs have served clients since 1987 (see box), but treatment advances have focused increasing attention on the program. Protease inhibitors (PIs) have proven to be very effective when used in combination with two or three other medications. As a result, demand for combination therapy has grown rapidly, not only among individuals already in care but also among those who had not previously sought treatment. Because the cost of combination therapy is very high -- between $10,000 and $12,000 a year per person -- ADAPs are greatly challenged in responding to the increased client demand.
Even before these expensive new drugs became available, many ADAPs were experiencing strains. The rapid growth of the HIV epidemic among poor and historically underserved populations, and evolving treatment standards that involve more than one antiretroviral drug, contributed to these strains. In addition, the number of people seeking and receiving treatment for HIV and AIDS continues to increase on a monthly basis.
ADAP funding has increased dramatically in recent years. In fiscal year (FY) 1996, $52 million in Title II CARE Act supplemental funds was appropriated specifically for ADAPs (this was in addition to the $47 million that States had already committed from their base Title II awards). In FY 1997, $167 million was earmarked for ADAPs, and in FY 1998, ADAP funding rose to $285.5 million. This amount increased to $461 million for FY 1999. For FY 2000, $528 million has been appropriated for ADAPs.
As the number of FDA-approved HIV treatments has increased, States have added some or all of the newer drugs within the limits of available resources. The availability of new, effective drugs, combined with the greatly increased cost of new medications, has affected the expansion of formularies. States determine which drugs to include on their formularies. There is considerable variation in the number of drugs on ADAP formularies, ranging from 15 to more than 400, with approximately 75 percent of the States covering 30 or more drugs.
Purchase and Distribution of Pharmaceuticals
In general, ADAP purchasing systems fall under two models: reimbursement or direct purchase. Many ADAPs were established to operate under a pharmacy reimbursement model similar to Medicaid. This allows patients to go to a participating pharmacy, show their ADAP cards, and have their prescriptions filled. The pharmacy then bills ADAP.
Alternatively, States with a system of pharmacies attached to a network of public health clinics use that system to purchase and distribute drugs for ADAP clients. A few ADAPs directly purchase drugs and mail them to clients.
With the significant growth in clients seeking treatment, dramatic increases in the cost of new treatments, and rapidly changing standards of care, ADAPs are challenged to contain costs at the same time they are asked to expand access. As a result, ADAPs have taken a number of steps to stretch dollars. These include changing the system used to purchase/distribute drugs, seeking larger price discounts (e.g., by participating in the Section 340B Drug Discount Program administered by HRSA or negotiating voluntary manufacturers' rebates), tightening income eligibility criteria, deleting some drugs from State formularies, setting caps on ADAP benefits, and/or establishing guidelines for prescribing drugs.
States have the authority to individually establish income and medical eligibility criteria.
- Income Eligibility: Because Title II gives States the authority to set income and medical criteria for ADAPs, there is wide variation among States. See table for a breakdown of income eligibility criteria.
The variation in eligibility generally reflects the type and availability of other health care resources for low-income individuals with HIV disease. It must be noted that even in States with more generous income eligibility standards, the overwhelming majority of enrolled individuals have incomes below 200 percent of FPL.
- Medical Eligibility: All States require individuals who meet income threshold criteria to provide proof of their HIV status. Nine States also require a laboratory test showing a CD4 count of 500 or less (indicating significant damage to the immune system). Four States have additional, specific, criteria in order for individuals to obtain access to protease inhibitors and/or antiretrovirals.
ADAPs in Context
A number of factors affect key State decisions regarding ADAPs. The ADAP is just one of multiple, important sources of public and private funding for HIV treatment. Medicaid is by far the largest payer, providing treatment to over 50 percent of all adults with AIDS nationwide. However, State Medicaid plans vary widely in terms of eligibility and covered services. States with more restrictive Medicaid eligibility, limited prescription benefits, and/or no optional coverage for medically needy populations, place special challenges on ADAPs. Too often these are also States with limited or no State contributions to the program. Those constraints are most often reflected in restrictive financial eligibility criteria and limited formularies. Other factors include the availability of affordable private insurance, insurance high-risk pools, and whether or not the State limits the extent to which private insurers may cap prescription benefits.