Prescription Drug Benefits

The Balanced Budget Act of 1997 included a number of changes to Medicare managed care. The newly created Medicare+Choice program differs from its predecessor with regard to payment policies, enrollment and disenrollment policies, and the types of plans that can contract to provide care to Medicare beneficiaries.

Executive Summary Prescription drugs play an ever-increasing role in modern medicine. New medications are improving health outcomes and quality of life, replacing surgery and other invasive treatments, and quickening recovery for patients who receive these treatments. As important as prescription drugs are, not everyone has access to them.

This report describes the experience of selected state governments in regulating provider-owned health care delivery systems that accept insurance risk for the provision or arrangement of health care services. We refer to these entities as Provider-Sponsored Organizations (PSOs).