Californians with incomes of up to 3 times the state's poverty level will be eligible for discounts of up to 60% on prescriptions for generic drugs, under the new drug assistance plan unveiled by Gov Arnold Schwarzenegger. State residents whose prescriptions are filled with more-expensive branded pharmaceuticals will be entitled to a smaller, 40% discount under the program.

Rather than subsidizing pharmaceutical assistance through tax revenues, the California plan would call on drug companies to give discounts to up to 5 million uninsured, low-income residents within 5 years. Manufacturers not offering discounts would be dropped from the state's Medi-Cal program.

Schwarzenegger's plan, which requires approval from both the state legislature and the federal government, would provide discounted prescriptions to 4-member families earning as much as $60,000 annually.