The AIDS Drug Assistance Program (ADAP) provides medications for the treatment of HIV disease. Program funds may also be used to purchase health insurance for eligible clients. Amendments to the Ryan White CARE Act in October 2000 added additional language allowing ADAP funds to be used to pay for services that enhance access, adherence, and monitoring of drug treatments. The program is funded through Title II of the CARE Act, which provides grants to States and Territories.

Funding

• Grants are awarded to all 50 States, the District of Columbia, Puerto Rico, Guam and the U.S. Virgin Islands. In FY 2002, two additional jurisdictions in the Pacific, the Marshall Islands and North Marianas, received funds.

• Congress "earmarks" funds that must be used for the ADAP, an important distinction since other Title II spending decisions are made locally. The ADAP "earmark" is by far the fastest growing component of CARE Act appropriations. It has increased more than 1,000 percent over the past five years, from $52 million in 1996 to $639 million in 2002. But total ADAP spending is even higher, since State ADAPs also receive money from their respective States, other CARE Act programs, and through cost-savings strategies.

• A formula based on AIDS prevalence is used to award ADAP funds to States and Territories. However, three percent of the total "earmark" is reserved for supplemental grants to States and Territories with demonstrated severe need that prevents them from providing medications consistent with Public Health Service Guidelines to clients.

Clients

• Approximately 128,078 people received medications through ADAP in FY 2000.

• None had adequate health insurance or the financial resources necessary to cover the cost of medications.

• Many clients are enrolled in ADAP only temporarily while they await acceptance into other insurance programs, like Medicaid. On average, 73,000 clients are served each month.

Implementation

The ADAP in each State and Territory is unique in that it decides which medications will be included in its formulary, and how those medications will be distributed.

• Many States and Territories provide medications through a pharmacy reimbursement model. Patients show enrollment cards at participating pharmacies to receive their medications, and the pharmacy invoices the ADAP for payment.

• Some ADAPs use pharmacies located within public health clinics to distribute drugs.

• A few ADAPs purchase drugs and mail them to clients directly.

Eligibility

Each State and Territory establishes its own eligibility criteria. All require that individuals document their HIV status. Nine programs require a CD4 count of 500 or less. Fifteen States have established income eligibility at 200 percent or less of the Federal Poverty Level (FPL). Nationally, more than 80 percent of ADAP clients have incomes at 200 percent or less of the FPL.

Increasing Demand

Pressure on ADAP resources has increased substantially.

• Highly Active Antiretroviral Therapy (HAART) is the standard of care for the majority of individuals living with HIV disease. Its cost may be $12,000 per year or more, in addition to the costs of addressing opportunistic infections, side affects, and other treatment issues.

• AIDS mortality has decreased dramatically in the United States since 1995, and HIV incidence remains constant at approximately 40,000 new infections annually. Therefore, the total number of individuals living with HIV disease continues to climb.

• The epidemic is growing rapidly among minorities, who have historically experienced higher risk for poverty, lack of health insurance, co-morbidity, and disenfranchisement from the health care system. The result is a growing number of individuals living with HIV disease who require public support.

Additional Resources

ADAP Funding (HTML or PDF 179KB)
ADAP funding has increased dramatically in recent years. In fiscal year (FY) 1996, $52 million in Title II CARE Act 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). By FY 2002, ADAP received $639 million, bringing total ADAP funding to over $2 billion since 1991. Beginning in FY 2001, 3 percent of the ADAP earmark will be used for supplemental treatment drug grants to States exhibiting severe need.

ADAP Formularies (HTML or PDF 140KB)
As the number of FDA-approved HIV treatments has increased, States have added new drugs within the limits of available resources. The availability of these new, effective drugs, combined with the greatly increased cost of new medications, has affected the expansion of formularies. States individually determine which drugs to include on their formularies. There is considerable variation in the number of drugs on ADAP formularies, ranging from 19 in one State to open formularies (i.e., inclusion of all medications related to the care and treatment of HIV/AIDS) in others. Approximately 90 percent of the States cover 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.

Cost-Containment Strategies (HTML or PDF 197KB)
With more 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 or rebates on drugs (e.g., through participation in the Section 340B Drug Discount Program), tightening income eligibility criteria, setting caps on ADAP benefits, and/or establishing guidelines for prescribing drugs.

Eligibility Criteria (HTML or PDF 116KB)
States have the authority to individually establish income and medical eligibility criteria.