Last fall, following a rate-increase hearing for 452 drugs, HHSC implemented reimbursement increases for 451 of them -- but left oral contraceptives at their 30-year-old $2.80 rate. "It was foolishness. It was all political," said Yvonne Gutierrez of Planned Parenthood's Government Affairs Council. "It was all `Republican Senator` Steve Ogden." It was also a huge financial burden on public-health and family-planning clinics, which have faced steep increases in contraceptive costs since the 2005 Deficit Reduction Act went into effect last year. The DRA eliminated the ability of safety-net providers like Planned Parenthood to negotiate prices with manufacturers. "We're stuck with whatever they dictate," said Gutierrez. Although Planned Parenthood had not yet passed along the increased cost to its clients, Gutierrez told the Current that without federal or state intervention, they -- and other providers -- would eventually have no choice.
Democratic State Representative Mike Villarreal of San Antonio, who recently launched an online petition that asked Hawkins to instate the recommended increase, said he was "shocked" when he heard today's announcement. "Better late than never, though."
"On a public-policy level it's a no-brainer," said Villarreal. "It saves money by not requiring Medicaid women to fill their prescriptions at a retail pharmacy that will charge the state $40 instead of allowing them to fill it at the clinic where they're receiving care, and at half the price."
Gutierrez and Villarreal note that studies have shown on-site contraceptive distribution is crucial. "It's been proven that for women to walk out of their gynecological exam with birth control is so much more effective," said Gutierrez.
But even those significant short-term savings are outweighed by the long-term benefits.
"When this population of Medicaid women, when they have an unintended pregnancy, who pays? Well, by definition we do, because they're covered by Medicaid ... $9,000 for every Medicaid birth," said Villarreal.
Although Gutierrez and Villarreal were in valedictory moods, there is still a $20 gap between retail-pharmacy and clinic reimbursement rates, a gap Villarreal would like to see closed. "I think it is a question about equity," he said. "Why would we favor for-profit pharmacies over public pharmacies, public clinics that are providing direct health-care services?" (Current suggestion: follow the $$.)
Villarreal gives credit for Hawkins' change of heart to the 1,800 people who signed his online petition, and to fellow legislators -- including Texas Rep and U.S. Senate candidate Rick Noriega -- who also wrote the commissioner: "That's a whole lot of Texans saying, 'You gotta rethink this decision, Mr. Hawkins.'"