The False Economy of Rationing Life

Across the country, states are making a choice. Faced with budget shortfalls driven by flat federal funding, the expiration of enhanced ACA premium tax credits, and the downstream wreckage of H.R. 1's nearly $800 billion in Medicaid cuts, they are choosing to solve their fiscal problems by restricting access to the medications that keep people living with HIV alive and stop the virus from spreading. Eighteen states have implemented cost-containment measureson their AIDS Drug Assistance Programs, with five more considering changes. Florida slashed ADAP eligibility from 400% to 130% of the federal poverty level on March 1, cutting off more than 12,000 people and removing Biktarvy, which accounts for 52% of the U.S. ARV market, from its formulary. Louisiana is considering HB927, legislation that would repeal the state's long-standing statutory protections against prior authorization and step therapy for antiretrovirals in Medicaid.

The pressures are real. ADAP enrollment surged 30% from 2022 to 2024 as states shed Medicaid enrollees after the pandemic. NASTAD's February 2026 ADAP Watch reports 19 ADAPs forecast deficits for the upcoming fiscal year. When adjusted for inflation, ADAP appropriations have declined 31% since 2005, with the FY2025 appropriation carrying roughly the same purchasing power as FY1999 levels. Nobody disputes the math. What we dispute, forcefully and on the evidence, is the response.

Utilization Management on ARVs Is Clinically Indefensible

Step therapy requires a patient to "fail" a medication before accessing the one their provider has already determined is best for them. In HIV treatment, failure means the virus has replicated in the presence of inadequate drug levels and potentially developed resistance, rendering the entire associated drug class less effective or ineffective. For someone on PrEP, "failing" a regimen means they have seroconverted and acquired HIV, possibly with resistance that limits their treatment options from day one. Prior authorization creates gaps in access while paperwork is processed. Drug resistance can develop within several weeks of stopping ART, as some components of a combination regimen remain in the body longer than others, leaving HIV exposed to one or two drugs instead of a full suppressive regimen. CD4+ cell counts can decline by up to 100 cells/mm³ within weeks of interruption. The SMART trial demonstrated that episodic ART interruption was associated with increased risk of opportunistic disease and death, findings so conclusive the strategy was abandoned entirely.

The CMS Medicare Part D Manual specifically notes that utilization management tools like PA and step therapy are generally not employed in best-practice formulary models for HIV/AIDS drugs. The American Academy of HIV Medicine issued a white paper with a single recommendation: HIV medications should be exempt from prior authorization requirements. As of 2019, 14 states had enacted laws prohibiting at least some UM techniques for ARVs. The broader health policy world is arriving at the same conclusion about PA generally: a January 2026 KFF Health Tracking Poll found that four in ten people with chronic conditions say prior authorization is their single biggest healthcare burden beyond costs, and KFF President Drew Altman has openly questioned whether its short-term cost control benefits are worth the costs to patients in an already overburdened system. If the mainstream is questioning PA broadly, the case for applying it to ARVs, where the clinical stakes include drug resistance, viral transmission, and death, does not exist.

The Math Doesn't Work, and the Motive Is Worse

Here is where we need to stop treating this conversation as though it is happening in good faith.

The stated rationale for stripping UM protections from ARVs is cost containment. But anyone who has watched private insurance markets operate over the past two decades recognizes what utilization management on high-cost drug classes actually produces: leverage. Private payers have used UM as a negotiating tool for years, threatening to restrict formulary access unless manufacturers offer deeper discounts. The people whose treatment gets disrupted in the process are the collateral damage that makes the threat credible.

CANN has been warning for years that as state Medicaid programs face mounting budget pressure, the temptation to adopt this same playbook would grow. That is exactly what is unfolding. When states impose PA and step therapy on antiretrovirals, the practical effect extends well beyond cost management. It creates a bargaining position where patient access to life-saving medication becomes a concession to be traded for supplemental rebates from manufacturers. This is the private payer model of healthcare as revenue generation imported into public health programs responsible for managing a communicable disease. It transforms the health of people living with HIV into a bargaining chip, and it represents a fundamental betrayal of what public health programs exist to do.

The people whose medications get delayed, whose viral loads rebound, whose resistance profiles narrow while prior authorizations are processed are not an unfortunate side effect of this model. They are the leverage. That is not healthcare. It is government treating public health as a profit center.

The economics don't support it either. Every new infection from someone with a detectable viral load carries an estimated lifetime medical cost of $326,500, with the cost avoided by preventing that infection estimated at $229,800. More recent analyses from HIVMA put average lifetime expenditures between $500,000 and more than $1.2 million. A Precision Health Economics analysis estimated that allowing UM on Part D antiretrovirals alone could result in over 6,750 new HIV infections. Whatever supplemental rebate a state might extract by threatening formulary restrictions will be dwarfed by the downstream costs. And in a U.S. cohort studied between 2021 and 2023, 28% of people with HIV experienced a treatment interruption of 90 days or more, with those affected disproportionately women, Black, dealing with substance use, and less likely to have commercial insurance. These barriers concentrate harm on the people who are already most structurally vulnerable.

We Have Already Watched This Fail

We don't need to theorize. We watched it happen with Hepatitis C. For years, state Medicaid programs and MCOs imposed PA, step therapy, sobriety requirements, and prescriber restrictions on curative direct-acting agents for HCV. People were denied treatment while their disease progressed. By the end of 2025, 34 jurisdictions had removed PA requirements for most Medicaid HCV patients, reflecting the national consensus that those restrictions never served patients or budgets. Louisiana itself now receives an "A" grade for HCV Medicaid access. As CANN's letter to Vice Chair McMahen on HB927 notes, the bill proposes substantially similar risks to HIV medication access as those once imposed on HCV, in a state that passed model PrEP and PEP legislation in 2024 that these same UM tools would undermine.

What Must Happen

Florida's own legislature proved these cuts are not inevitable when it passed HB 697 in mid-March with $31 million to restore ADAP eligibility for over 11,000 people. Bipartisan, responsive, and proof that different choices are available when the political will exists.

States must fight for adequate federal ADAP funding, which has been flat-funded since FY2014 while program costs have grown relentlessly. They must leverage 340B rebates and supplemental funding rather than cutting the people the programs exist to serve. They must design Medicaid formularies to ensure access following federal HIV treatment guidelines, not undermine them. And their federal legislators should realize that if we can fund the Department of Defense at a trillion dollars a year, we can surely pay to keep people from dying from AIDS.

There is no clinical necessity for removing ARV protections. Doing so will not balance budgets. It will create drug resistance, increase transmission, push people into more expensive care settings, and compound the harms of H.R. 1's Medicaid budget cuts and work requirements, which threaten coverage for 42% of Medicaid enrollees with HIV. At every level of analysis, this approach fails. What it succeeds at is transferring the cost of federal policy failures onto the bodies of people living with HIV, and that is not fiscal responsibility. It is abandonment dressed in budget drag.

Florida's ADAP Cuts Put 16,000 People Living with HIV at Risk

On January 8, 2026, the Florida Department of Health (DOH) sent an email to healthcare partners announcing sweeping changes to the state's AIDS Drug Assistance Program (ADAP), effective March 1, 2026. In the days that followed, thousands of Floridians living with HIV received letters informing them that their access to life-saving medications and insurance coverage would be drastically curtailed in less than two months. The announcement came with minimal warning and no prior engagement with the affected community, marking an alarming departure from decades of collaborative public health practice and threatening to unravel progress made toward Ending the HIV Epidemic.

What Florida Is Doing

The changes are significant in scope. Florida DOH is reducing ADAP income eligibility for uninsured clients from 400% of the Federal Poverty Level (FPL) down to 130% FPL, which translates to an annual income of approximately $20,345 for a single person. The state is eliminating insurance premium assistance, which previously helped people maintain coverage through the Affordable Care Act (ACA) marketplace. Florida is also removing Biktarvy, the most widely prescribed single-tablet HIV regimen, from the ADAP formulary while restricting Descovy to people with renal insufficiency.

According to the National Alliance of State and Territorial AIDS Directors (NASTAD), Florida ADAP served 32,248 clients in 2024, with 40% at or below 100% FPL, 10% between 101–138% FPL, and 50% between 138–400% FPL. With a cutoff at 130% FPL, NASTAD estimates that more than 16,000 people will lose ADAP coverage. The administration has offered a different estimate. At a January 14, 2026 Florida Senate Appropriations Committee hearing, Florida Surgeon General Joseph Ladapo estimated approximately 10,000 people would be affected.

The numbers matter less than the underlying reality: half of all Floridians currently relying on ADAP for uninterrupted access to HIV treatment face immediate risk of treatment disruption based on an administrative eligibility change, not clinical need.

The Stated Rationale and Its Problems

DOH has framed the changes as necessary to prevent a projected $120 million budget shortfall, attributing the crisis to rising health care insurance premiums and the expiration of enhanced ACA premium tax credits at the end of 2025. The federal government shutdown in October 2025, during which Republicans and Democrats fought over the impending expiration of these tax credits, did lead to their lapse on December 31. Florida, with nearly 4.5 million people receiving marketplace insurance and roughly 31% of ADAP clients enrolled in marketplace plans, faces genuine financial pressure.

What DOH has not provided is transparency around its budget calculations. At the Senate hearing, David Poole, who oversaw Florida's AIDS program from 1993 to 2005, pointed out that the state transparency website shows $120 million in rebate revenues from the prior year. Testimony from a former consumer representative to the Florida DOH ADAP Advisory Workgroup indicated that information shared with stakeholders suggests the expanded tax credits had minimal impact on the program, with insurance premiums increasing only about $150 per client annually. The state has not publicly released an ADAP budget in more than a year, according to Malcolm Ried of the U.S. People Living with HIV Caucus.

When Senator Carlos Guillermo Smith asked Kendall Kelly, director of policy and budget under Governor DeSantis, about the state's authority to make such dramatic cuts to a federally funded program, Kelly referenced a potential $700 million shortfall for the health department overall but could not provide specifics about federal funding changes. No other state has made such drastic changes to its ADAP program this year. Pennsylvania, facing similar budget pressures, reduced its eligibility from 500% to 350% FPL—a far more measured response.

The Clinical and Public Health Stakes

Treatment interruption for a person living with HIV is a clinical risk, not an administrative inconvenience. When antiretroviral therapy (ART) is interrupted, viral rebound occurs, drug resistance can develop, viral suppression is lost, and the risk of onward transmission increases. The science is clear: consistent treatment keeps people healthy and prevents new transmissions. This principle underlies the entire Ending the HIV Epidemic (EHE) initiative, which targets sustained viral suppression as one of its four core strategies.

Dr. Paul Arons, the former Medical Director of the state HIV/AIDS program from 1989 to 2007, testified that asking a person with HIV whose treatment is working to change regimens for non-medical reasons is a traumatic request. According to the U.S. Department of Health and Human Services (HHS), 89.6% of clients enrolled in the Ryan White HIV/AIDS Program achieved viral suppression as of fiscal year 2025. HIV medications have among the highest adherence rates of any chronic disease treatment. Disrupting that success for opaque and questionable budget claims defies logic and evidence-based practice.

The formulary changes compound the harm. Biktarvy is prescribed to 60% of Florida ADAP clients. The state has offered no transition plan, no guidance on which generics will replace it, and a warning that additional formulary restrictions may follow. The International Association of Providers of AIDS Care (IAPAC) has called this approach drug rationing under the banner of cost control.

A Failure of Process

Federal Ryan White legislation and HRSA HIV/AIDS Bureau (HAB) guidance require states to engage stakeholders, including people living with HIV, in program planning and to explore cost-saving measures before implementing cost-cutting measures like eligibility reductions or formulary restrictions. The ADAP Manual from HRSA HAB distinguishes between cost-saving measures (improving efficiency, expanding health care coverage, maximizing rebate collection) and cost-cutting measures (restricting enrollment or benefits). Waiting lists are described as a last resort.

Florida DOH bypassed this framework entirely. The eligibility level for Florida's ADAP program is established in regulation, requiring a public regulatory process to change. No such process was undertaken before this announcement. The announcement came with less than two months notice, days before the ACA open enrollment period ended, and without prior consultation with advisory workgroups or community partners. Testimony at the January 14 Senate hearing revealed that stakeholders learned of the changes only days earlier and were never brought in to discuss cost containment measures.

The timing compounds the harm. Florida's plan to cancel premium assistance was announced just days before the end of ACA open enrollment. ADAP enrollees had selected plans approved by the program, often with higher premiums, because ADAP covered the cost. Canceling those subsidies as of March 1 leaves people locked into plans they cannot afford with no ability to change their enrollment.

The abrupt nature of the announcement left people living with HIV scrambling. "This is deeply personal for me—not only do I rely on this coverage to stay virally suppressed, but I also need it to manage other health issues as I age with HIV," Kamaria Laffrey, Co-Executive Director of The SERO Project and a Florida resident, told Positively Aware. "With no warning and no transparency, this feels like a random and unjustified attack on people simply trying to live."

The lack of transparency extends to notification. Some people will not receive termination letters because they did not consent to mailings at home. County health departments, according to testimony, have not received guidance on tracking these clients. The two-month transition window is unrealistic for navigating alternative coverage in a fragmented insurance market, particularly after open enrollment has closed.

Historical Echo

This situation carries echoes of an earlier Florida crisis. In the early 2010s, following the 2008 recession, Florida maintained the largest ADAP waiting list in the nation, with thousands of people waiting months to access medications. Advocates fought to implement cost containment measures and stabilize the program. The state eventually recovered, but the lessons of that period—the importance of transparency, stakeholder engagement, and exploring alternatives before cutting eligibility—appear to have been forgotten.

What Happens Next

The policy implications extend beyond Florida. Because all state ADAPs rely on the same federal funding streams, what happens in one state signals possibilities for others. IAPAC has urged clinicians in states with similar political and fiscal dynamics to engage their representatives proactively. The Save HIV Funding campaign has noted that the Florida changes come alongside broader health system destabilization, including Medicaid cuts and disruptions to federal HIV programs, creating a compounding effect.

At the state level, Chair Jay Trumbull of the Senate Appropriations Committee indicated the issue would likely be negotiated during budget talks. Surgeon General Ladapo acknowledged the situation could become a crisis without intervention and suggested funding approaches that might not be onerous. Yet DOH has not requested additional state funds, despite Florida holding $17 billion in reserves.

What Needs to Happen

The immediate need is a complete halt to the March 1 implementation while finances are fully reviewed and medically sound alternatives are developed. Florida must release transparent budget data, engage stakeholders as required by federal law, and explore the full range of cost-saving measures before resorting to eligibility cuts and formulary restrictions.

For advocates and policymakers watching this unfold, the Florida crisis offers a clear lesson: when states treat HIV programs as budget line items rather than public health infrastructure, people fall out of care, viral suppression declines, and new transmissions occur. The economic argument for maintaining access is well-established: keeping people in care and virally suppressed prevents costly emergency interventions, hospitalizations, and new transmissions that carry their own long-term treatment costs.

Florida has the resources, the federal funding framework, and the clinical expertise to maintain a functional ADAP program. What it lacks, at this moment, is the political will to use them or the moral grounding to not sacrifice the most vulnerable. The cost of that failure will be measured in preventable illness, unnecessary suffering, and setbacks to the national goal of Ending the HIV Epidemic. We cannot let that happen.