Ladies and Gentlemen:

I am filing with the Secretary of State Senate Bill 05-102, "Concerning multistate drug purchasing, and making an appropriation." I vetoed this bill as of 1:50 p.m. today and this letter sets forth my reasons for doing so.

S.B. 102 would require the state to apply for necessary federal authorization to enter into a multistate prescription drug purchasing pool and establish a prescription drug formulary for Colorado's Medicaid recipients. Restricting the Medicaid population's access to much needed prescription drugs and interfering with the doctor/patient relationship would result in detrimental health effects while exacerbating health care costs in other areas of Medicaid.

Medicaid patients often have unique and severe health care needs. The Medicaid population represents vulnerable populations including disabled children, chronically ill elderly, single mothers, infants, disabled adults, and many long-term care patients. S.B. 102 would place even more barriers in the way of both Medicaid recipients and the physicians who are committed to their quality treatment. Prescription drug lists limit the options of physicians to prescribe the correct medication for their patients.

Even a prescription drug list based on the best and purest science of the moment cannot anticipate the complex problems faced by those with multiple disabilities and medical conditions. Restricting and switching access to prescription drugs could reduce the quality of patient care and cause severe adverse medical consequences. For example, a particular diabetes medication might be appropriate for treating individuals with diabetes only, but completely inappropriate and possibly deadly for a patient with diabetes and schizophrenia.

I believe that the many organizations representing vulnerable and underrepresented populations in our state have valid concerns that have been expressed during their strong opposition against S.B. 102. The Colorado Cross-Disability Coalition urged me to veto S.B. 102 because it is an unfair attack on Colorado's most severely disabled citizens who rely on Medicaid. The Colorado chapter of the National Alliance for the Mentally Ill, Colorado's voice on mental illness, fears that even though drugs for treatments of mental illness have been exempted, its constituency could be harmed by a prescription drug list because individuals with mental illnesses frequently have other illnesses referred to as "co-occurring disorders." The dangerous possible side effects that are introduced when individuals are taking multiple medications need to be carefully managed by the doctor in concert with the patient. The Colorado Gerontological Society shares the belief that prescription drug lists could cause adverse health effects to seniors who have not been properly informed about prescription drug lists. Groups representing minorities have also been adamant advocates against prescription drug lists. In 2003, the National Caucus of Black State Legislators and National Caucus of Hispanic State Legislators resolved to work together to in an effort to facilitate improved access to care and treatments at the state and federal level; and further resolved that, "it is the responsibility of elected officials to advise key stakeholders about the harmful impact of preferred drug lists (PDL) for special patient populations and the importance of protecting the physician's drug selection authority." During my time as governor, I have worked to protect these individuals and S.B. 102 would take away much of that needed protection.

Besides the increased health issues associated with implementing a prescription drug list, S.B. 102 is simply not cost effective. The savings anticipated in the fiscal note would be almost entirely negated by the costs of establishing and administering the program. In addition, prescription drug lists could shift costs to other areas of Medicaid. Disrupted treatments and drug therapy revisions can lead to increased hospitalizations, emergency room visits, and physician visits.

I do not believe that the more than $300,000 in administrative costs required to establish the new government programs set forth in this legislation are a prudent use of taxpayer funds. The costs associated with S.B. 102 are funded from savings in House Bill 05- 1243, which will provide estimated annual savings of more than $10 million in Colorado's Medicaid program by allowing capable consumers to direct their own health care. It is hardly a model of good fiscal stewardship to use savings generated from running a program more efficiently redistributed for the creation of new programs.

I do believe that cost containment is important and I would like to commend both the Legislature and the Medicaid program for already taking major steps to contain the cost of the prescription drug budget. In 2003, our Legislature passed legislation that required Medicaid to use generic drugs first and to review the appropriateness of a medication before and after patient use. In addition, the Medicare Modernization Act, starting in January 2006, will remove approximately fifty percent of the prescription drug expenditures from Medicaid by switching dual Medicaid/Medicare eligibles over to Medicare.

I believe there are better ways of saving money in Medicaid while enhancing, rather than jeopardizing, the quality of care patients receive. Accordingly, I have vetoed this bill.

Sincerely,