State Pharmaceutical Assistance Programs

State Pharmaceutical Assistance Programs (SPAPs) generally assist beneficiaries with limited financial resources with their prescription drug costs. Eligibility criteria vary from program to program. The MMA allows SPAPs to “wrap-around” the Medicare Part D benefit and fill in coverage gaps for medication that are either: 1.) not covered by an individual’s PDP or MA-PD plan; 2.) excluded by law; or 3.) cost prohibitive while someone is in the coverage gap (“doughnut hole”).[1] Beneficiaries still pay a portion of the cost for each of their medications even with Part D and SPAP coverage.

All other forms of drug coverage, including Part D, are primary to coverage provided by a SPAP. That is, a SPAP will only cover medications after any other drug coverage is applied to the cost of that drug. Additionally, payments made by a SPAP to cover drugs that are on the plan’s formulary, but are needed during the coverage gap (“doughnut hole”), count towards TrOOP for the Part D plan.[2] As of February, 2009, 24 states and territories offer qualified SPAPs that provide some level of coverage to SPAP enrollees who are also enrolled in a Part D plan.[3]

[1] SPAPs that wrap-around Part D plans must meet certain criteria set forth under the MMA. These SPAPs are referred to as qualified SPAPs. More information on qualified SPAPs is available from CMS at: http://www.cms.hhs.gov/States/Downloads/QualifiedSPAPGuidelines.pdf

[2] Only payments from qualified SPAPs count towards TrOOP. For more information on TrOOP, please see "Costs and Prices" in HAP's Medicare Part D SHIP Resource Guide.

[3] http://www.cms.hhs.gov/States/Downloads/QualifiedSPAP2.17.09.pdf