Barone v. Dep't of Human Servs., Div. of Medical Assistance & Health Servs., Etc

Barone v. Dep't of Human Servs., Div. of Medical Assistance & Health Servs., Etc

Opinion

 [*358]   [**1057]  ] The New Jersey Pharmaceutical Assistance to the Aged and Disabled Act (Pharmaceutical Assistance Act or PAAD), N.J.S.A. 30:4D-20 to -35, grants benefits to financially-eligible disabled residents under the age of sixty-five who receive Social Security Title II Disability Insurance (SSDI) payments, but denies benefits to those disabled persons under the age of sixty-five who do not [***2]  receive SSDI benefits. The issue in this appeal is whether this distinction -- between disabled persons who receive SSDI benefits and those who do not -- violates the equal protection clauses of the United States and New Jersey Constitutions. The Appellate Division upheld the constitutionality of the Act. 210 N.J. Super. 276 (1986). We granted certification, 104 N.J. 461 (1986), and now affirm.

The Pharmaceutical Assistance Act was originally enacted in 1975 to supplement the New Jersey Medical Assistance and Health Services Act, N.J.S.A. 30:4D-1 to -19, also known as Medicaid. Medicaid was intended to use federal appropriations to the states to provide medical assistance for the elderly, the disabled, and dependent children in need. Individuals eligible for assistance under Medicaid have their pharmaceutical costs paid through that program.

The Pharmaceutical Assistance Act was "designed to ease the burden of spiraling drug costs for senior citizens [and disabled residents] of modest incomes." N.J.S.A. 30:4D-25. As originally enacted in 1975, PAAD covered only those citizens over the age of sixty-five who were ineligible for Medicaid benefits because [***3]  their incomes exceeded Medicaid requirements, but were nonetheless unable to afford prescription  [*359]  drugs. Specifically, the program was open to any resident over the age of sixty-five whose annual income was less than $ 9,000. L. 1975, c. 194, § 2. Later in 1975, benefits were extended to any married resident whose income, combined with that of his or her spouse, was less than $ 12,000 annually. L. 1975, c. 312, § 1. Initially, the program reimbursed eighty percent of the cost of prescription medicine once the cost exceeded a sliding percentage of the recipient's income. L. 1975, c. 194, § 3. To simplify administration of the program, this sliding percentage was replaced by a requirement that beneficiaries pay one dollar of the cost of each prescription. L. 1977, c. 268, § 1. The program was not eligible for federal funding. Therefore, the State paid for it from the State's general revenues.

Participation in the Pharmaceutical Assistance Program increased rapidly. By 1978, there were approximately 270,000 senior citizens enrolled in the program. N.J.S.A. 30:4D-25. In 1978, the Legislature raised the co-payment requirement [***4]  to two dollars, L. 1978, c. 171, § 2, explaining that "the overwhelming success of this program . . . has resulted in costs far greater than those anticipated." N.J.S.A. 30:4D-25. The Legislature said:

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