March 24, 1976
Senator Kenneth B. Jones
1701 Pine Street
Yankton, South Dakota 57079
OFFICIAL OPINION NO. 76-36
Co-payment of drug prescriptions
Dear Senator Jones:
You requested an official opinion from this office answering the question whether the South Dakota rule requiring a 50 cent co-payment on the part of welfare recipients having prescriptions filled under the Title XIX program is legal. The rule you refer to is ARSD 67:16:14:10 and states as follows:
A co-payment shall be paid by the eligible individual for each prescription filled. The amount of the co-payment shall be established by (the) Board of Social Services based on the criteria and guidelines established in 45 CFR 249.40(a)(b). The provider shall collect this co-payment and show a credit on the line entitled "paid by other sources" on the prescription claim form.
45 CFR §249.40(a)(1) provides that a state plan for medical assistance under Title XIX of the Social Security Act must provide that no cost sharing or similar charge will be imposed with respect to the care and services listed in clauses (1) through (5) and (7) of §1905(a) of the Social Security Act. §1905(a) of said Act is codified at 42 USCA §1396d (a). Clauses (1) through (5) and (7), for which no cost sharing or similar charge may be imposed, provide for the following respectively numbered services:
(1) Inpatient hospital services
(2) Outpatient hospital services
(3) Laboratory and x-ray services
(4)a Skilled nursing facility services
(4)b Early and periodic screening and diagnosis of eligible
individuals under 21 years of age
(4)c Family planning services
(5) Physicians' services
(7) Home health care services
Under this same listing, the prescription drug program is listed as number (12). Therefore, according to 454 CFR 249.40(a)(1) a co-payment charge may be exacted in administering the prescription drug program. This is further substantiated by 45 CFR §249.40(a)(3) which provides that the state plan must:
If any deductible, coinsurance or co-payment is imposed on the categorically needy (for services other than those listed in clauses (1) through (5) and (7) of §1905(a) of the Act) or the medically needy (for any service under the plan), specify the services for which such charges are applied and the amount and the basis for determining the charges. States may impose a deductible or coinsurance or co-payment charge for a particular type of service, but may not impose more than one of such charges on any particular type of service.
Therefore, I am of the opinion that a co-payment may be imposed for prescription drugs since such service is not included among those six listed at 45 CFR 249.40(a)(l). It is only those six services listed for which a co-payment may not be imposed.
It is possible that one of the six programs would mandate a service which is otherwise optional. If this were the case, then a co-payment for such mandated service could not be exacted. For example, family planning services would include prescriptions for birth control pills. A co-payment for such a prescription would not be legal. In regard to early and periodic screening and diagnosis, certain additional services are mandated. 45 CFR §249.1O(a)(3)(iv) states that a state plan must provide:
that early and periodic screening and diagnosis to ascertain physical and mental defects, and treatment of conditions discovered within the limits of the state plan on the amount, duration and scope of care and services, will be available to all eligible individuals under 21 years of age; and that, in addition, eye-glasses, hearing aids, and other kinds of treatment for visual and hearing defects, and at least dental care as is necessary for relief of pain and infection and for restoration of teeth and maintenance of dental health, will be available, whether or not otherwise included under the state plan, subject, however, to such utilization controls as may be imposed by the state agencies.
You pointed out in your letter that Mr. Chris Armigo of the Medical Services Division of HEW in the Denver office advised you that the imposition of a co-payment is illegal in the following instances:
1. Family planning
2. Certain cases where children are under foster care and are undergoing early and periodic screening and diagnosis.
Such is in accord with this opinion. As pointed out above, no cost sharing or similar charge may be imposed with respect to these services. However, should HEW specifically advise the State in writing that it may not, in its administration of its Medicaid program, impose a co-payment for prescription drugs, then the State would have to comply with such interpretation or be out of compliance with federal standards.
Respectfully submitted,
WILLIAM J. JANKLOW
ATTORNEY GENERAL
WJJ:WHE:dk
