Medicaid's prior authorization program and access to atypical antipsychotic medications

State Medicaid programs use prior authorization (PA) to control drug spending by requiring that specific conditions be met before allowing reimbursement. The extent to which PA policies respond to new developments concerning medication safety is not known. In April 2005 the Food and Drug Administration (FDA) issued an advisory describing increased mortality among elderly people with dementia taking atypical antipsychotics. More than a year later, no state had changed its PA policy in response. We discuss the roles of Medicaid and other insurers in responding to emerging drug safety issues and their challenges in weighing drug risks and benefits.