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Audit Underway of State Pharmaceutical Assistance Programs

About 325 thousand older Pennsylvanians receive state subsidized prescriptions under the PACE and PACEnet pharmaceutical assistance programs. 

State Auditor General Eugene DePasquale has begun a performance audit of the $400-million-a-year programs.

“Since so many older people depend on these programs, we want to make sure that they are being operated as efficiently and effectively as possible to ensure that the prescription benefits will be available in the future to those who need it,” he said.

PACE was created in 1984. Pennsylvanians, 65 or older, are eligible if their individual income does not exceed $14,500 or $17,700 for married couples. Their co-pays are $6 for generic drugs and $9 for brand-name medications.

PACEnet was added 12 years later to include elderly with incomes up to $23,500 for an individual and $31,500 for married couples. There’s a $40-per-month deductible for PACEnet beneficiaries in addition to the co-pay of $8 for generics and $15 for brand names.

DePasquale said this is not a regularly scheduled review nor was it prompted by any concern. 

“It had been a while since the program had an independent review, and I thought it was the appropriate time to go in and take a look,” he said.

His office will explore is how many elderly are eligible and what percentage takes advantage of the programs. 

“You see if there are any gaps there and you examine the gaps as to why,” DePasquale said. “But the biggest issue is the cost. Are we getting the biggest bang for our buck or is there potentially a way to get even more seniors involved in this, is there a way to reduce costs.”

One way to possibly trim costs is to ensure that PACE and PACEnet are the  “payers of last resort” for prescriptions — “meaning that PACE isn’t tapped when there’s some other means (insurance) to pay it.”

He added that he’s not going into the audit with any preconceptions. 

“We just want to make sure the program is delivering, in a cost effective way, the promises made to Pennsylvania seniors,” DePasquale said.

He said there is no indication that the programs have any fiscal troubles at present but there could be an increased demand in years to come. 

“As Pennsylvania continues to age, it doesn’t mean there’s an immediate issue, but one of the things we’re going to see is there going to be a need for any adjustments moving forward to make sure there is money to meet this promise in the future,” DePasquale said.

DePasquale expects his office’s findings to be delivered to the Department of Aging later this year, and the department will have a chance to respond before the final report will be released.