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House approves Medicaid preferred drug list aimed at limiting prescription costs
Summary
The House passed Senate Bill 42 to let the state create a preferred drug list (PDL) for Medicaid, which sponsors say will reduce prescription spending via volume discounts while preserving physician authority to override the list for medical necessity.
The Utah House voted to approve Senate Bill 42 on Feb. 7, authorizing the state health insurance department to establish a preferred drug list for people covered by Medicaid. Sponsor Representative James Dunnegan said the list will consolidate clinically proven medicines to secure volume discounts and manufacturer rebates, and estimated combined federal and state savings of roughly $2.7 million in the first year.
Supporters framed the bill as a practical cost-control measure. "We're currently paying over $200,000,000 a year for prescriptions for Medicaid insureds," Dunnegan said, adding that prescription spending was growing faster than other medical costs. Representative Dunnegan said 39 other states already use similar lists and that the policy mirrors lists already used in state employee health plans and CHIP.
The bill includes a physician safeguard: if a Medicaid patient needs a drug not on the PDL, a doctor can write "do not substitute" on the prescription and document medical necessity in the chart so the patient may obtain that drug without prior authorization. Dunnegan called that an important out for unique medical needs: "The doctor simply has to write 'do not substitute' on the prescription," he said.
Representative Dave Clark questioned the fiscal assumptions and asked whether the cited savings would hold if many drugs are excluded or if physicians frequently override the list. Dunnegan said the health department will monitor override patterns and revise recommendations if necessary.
Representative Mascaro and others described the PDL as a long-running effort that balances access with cost control. In closing remarks, Dunnegan noted that Medicaid spending had been increasing and said the PDL is intended to limit future budget pressures driven by prescription inflation.
The clerk recorded the House vote as '69 yes votes, 1 no vote, 5 absent' and announced that Senate Bill 42 passed the House and will be signed by the speaker and referred to the Senate for the president's signature.
Next steps: the bill will be transmitted back to the Senate for signature and completion of the enrollment process.
