GPhA participates with federal and state governments to implement policies that promote increased generic use, thereby achieving greater savings. GPhA member companies play a significant role in providing prescription medicines to the nearly 60 million Americans receiving Medicaid benefits. Approximately 65% of all drugs dispensed through the Medicaid program are generic, costing on average 60% less per prescription than the corresponding brand and saving the Medicaid program tens of billions of dollars each year.
- States can save hundreds of millions of dollars each year through the use of generic medicines in their Medicaid programs. For example, Texas saved more than $223 million simply by changing its prescription pads, making it easier for doctors to prescribe generics
- Even with federal support, states report they are struggling to meet their share of expanding Medicaid costs. On average, Medicaid consumes about 20% of a state's budget. However, some states are spending as much as 31% percent of their annual budgets on Medicaid.
- Nationally, Medicaid covers 59 million low-income Americans, including families, people with severe disabilities, and low-income Medicare beneficiaries, known as "dual eligibles." Total Medicaid spending on health care services and prescription drugs totaled approximately $450 billion in 2010.
GPhA works with state Medicaid agencies to promote best practices aimed at increasing the use of lower cost generic medicines. These efforts allow states to reduce their pharmacy expenditures while also ensuring that patients can get the medicines they need.
GPhA advocates for generic substitution laws in the Medicaid program to take full advantage of the benefits generics offer. Under these substitution policies, the brand name drug remains available to beneficiaries through the use of "prior authorization" by the prescribing physician.
As part of its ongoing public relations activities, GPhA instituted a process to respond immediately to publications or broadcasts of anti-substitution stories. GPhA conducts outreach with reporters on their stories, and works aggressively when story opportunities are identified to present the generic perspective, to proactively share FDA information about the substitution of generics.