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Prescription Drug Spending Soared 17.4% During 1999-Congress OK`s Lower-Cost Prescription Drug Imports Spending on prescription drugs soared a record 17.4% last year with seniors over 70 years old hardest hit by rising prices according to a new report by the nation's largest independent pharmacy benefit manager. The report put pressure on Congress to pass legislation that would add prescription drug benefits to Medicare and cut the cost of prescription drugs. In June, the House passed a bill that would provide federal subsidies to private insurers to offer "drug-only" insurance to Medicare recipients, rather than add a prescription drug benefit directly to Medicare. Private insurance companies are reluctant to support the legislation, warning that the "drug- only" policies are likely to be very costly. The fate of prescription drug benefit legislation is even more uncertain in the Senate. The chairman of the Senate Finance Committee, Delaware Republican William Roth Jr., broke with House Republicans to propose a government-administered program adding the coverage to the rest of Medicare. Under Senator Roth's proposal Medicare beneficiaries could stay in the original fee-for-service Medicare with existing benefits, premiums, deductibles and co-payments. Or, they could enroll in a "high-option" plan which would provide drug benefits, but would also charge more for certain services like laboratory tests and home health care. The Senate Finance Committee remains divided over how to create the prescription drug coverage will probably not vote until September. The Senate did take action that could drive down the costs of prescription drugs by passing legislation that would allow pharmacists and drugstores to import lower-cost FDA-approved drugs from Canada and other countries. The House passed similar legislation. Nearly 89% of seniors responding to a survey in the February issue of this newsletter say they support such legislation, which stands a good chance of getting signed into law by President Clinton. "The pharmaceutical lobby was taken somewhat by surprise by the speed and support for the issue," according to Ira Loss, an industry analyst. Sources: "Express Scripts 1999 Drug Trend Report: Seniors Hit Hardest By Record 17.4 Percent Prescription Drug Spending Increase," Express Scripts, Inc., June 27, 2000. "Senate Chairman Offers Proposal on Drug Benefits," Robert Pear, The New York Times, July 11, 2000. "U.S. Senate Panel Seen Delaying Medicare Prescription Drug Vote," Bloomberg News, July 17,2000. "U.S. Lawmakers Put Pressure On Drug Companies To Reduce Prices," Bloomberg News, July 19,2000. This article first appeared in Volume 5, Issue 10 of "The Social Security and Medicare Advisor" newsletter (October/2000). To receive future editions of "The Advisor" in its special, free e-mail version, please click here. | ||||||||
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