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DVHA reports $287 million drug spend, sets aside $4.5 million for new high-cost therapies
Summary
DVHA told lawmakers it manages roughly $287 million in drug spending across state programs, reported a 4% decline in gross drug spend last year and included a $4.5 million FY26 request to cover new, very high-cost therapies not in the current baseline.
Department of Vermont Health Access officials told the House Appropriations Committee that the agency manages about $287 million in gross drug spending across publicly funded programs and reported a roughly 4% decrease in gross spend in the most recent fiscal year.
Stephanie Barrett, DVHA chief financial officer, told the committee the total managed drug spend covers Medicaid and other public programs and that physician‑administered drugs sometimes fall outside the Medicaid system’s reporting. Barrett said DVHA recorded a decrease of about 4% in gross drug spend over the last fiscal year.
DVHA also asked for a $4.5 million adjustment to capture forecasted pressure from new high-cost pharmaceuticals that were not in the agency’s FY25 baseline. The agency said these include gene therapies and other single-case or small-population treatments with multi-hundred-thousand to multi-million-dollar price tags. Barrett and other witnesses cited examples such as emerging gene therapies and high-cost specialty drugs; the agency’s estimate is intended as a budget contingency for drugs that may be newly prescribed to Medicaid members.
On GLP-1 medications (commonly used for diabetes and, off-label, for weight loss), agency witnesses explained the coverage rule: DVHA covers GLP-1s when prescribed for covered diagnoses such as diabetes and certain cardiac conditions, but it does not cover them solely for weight-loss indications. “If they had a diabetes diagnosis…we do cover that. That’s a covered service for the GLP-ones,” a DVHA official said during questioning.
Supporting details: - DVHA-reported drug spend managed: approximately $287,000,000 across public programs. - Gross drug spend change: ~4% decrease from the prior fiscal year, according to agency testimony. - Contingency request for new high-cost therapies: $4,500,000 built into FY26 request; agency noted that individual cases can cost millions.
Ending: Committee members asked how the agency identifies new drugs and how clinical eligibility will be determined. DVHA said the pharmacy unit produces reports and that the agency will return with more detailed analysis as new therapies emerge and coverage decisions are made.
