ElderWeb

The Florida Agency for Health Care Administration announced that they have published a new guidebook online, called Understanding Prescription Drug Costs. The guide contains information for everyone who needs prescription drugs - whether or not they have health insurance to cover those costs. The purpose of this brochure is to help consumers know what cost-saving options there are and what questions to ask. They point out that the best sources of information to help save money on prescription drugs are physicians, pharmacists, and the customer service or employee benefits office of your health insurance plan. The brochure is a new addition to the extensive information about drugs available on FloridaHealthStat.com, the official source of consumer healthcare information from Florida government health and human service agencies.

The Health Care Financing Administration (HCFA) has published a directory of programs that provide assistance with drug costs on its Medicare.gov site. The directory allows you to select a state and zip code, as well as manufacturers and diseases and conditions you are especially interested in. It then provides a list of drug assistance programs that fit these criteria, along with contacts and frequently asked questions. The database is still evolving and does not include all programs yet, but the tool provides one way to see if assistance is available for the cost of pharmaceuticals. For other programs and directories, see ElderWeb's Drug Cost page.

FamiliesUSA has issued a report about past and projected future costs to the elderly of prescription medicines. Their study shows that the 65+ population constitutes only 13% of the population, but accounts for 34% of all prescriptions dispensed and 42% of every dollar spent on prescription drugs! Seniors will average $1,205 a year on prescription drugs in 2000, which will comprise about 10% of their average total healthcare expenditures of $12,028. There has been a 116% increase in prescription drug expenditures since 1992, as compared to a 59% increase in total healthcare expenditures during the same time period. These increases are due to changes in both utilization and cost. The average number of prescriptions increased from 19.6 in 1992 to 28.5 in 2000, and the cost per prescription increased from $28.50 in 1992 to $42.30 in 2000. FamiliesUSA had no figures for the percentage of this expenditure which would be born out-of-pocket in 2000, but pointed out that Medicare beneficiaries paid nearly half of their prescription drug costs out-of-pocket in 1996.

Health Affairs, a leading journal of health policy, devoted a recent issue entirely to the subject of prescription drug prices and proposed plans to expand Medicare coverage to include them. They discuss drug costs, drug industry advertising, proposed legislative efforts to broaden Medicare coverage, and a host of other related issues.

Families USA released a report about the rising cost of pharmaceuticals for older people. The report found that in the one year period from 1999-2000:

* Prices for the 50 drugs most frequently used by seniors rose, on average, nearly double the rate of inflation
* Of the 50 drugs, only 12 rose slower than inflation; nine had no price increase.
* Prices for 33 of those drugs rose by at least 1.5 times the rate of inflation.
* Prices for 25 of those drugs rose at least twice the rate of inflation.
* Prices for 15 of those drugs rose at least three times the rate of inflation.
* Prices for 11 of those drugs rose at least four times the rate of inflation.

The cost of one drug, furosemide (a diuretic manufactured by Watson and used to treat conditions such as hypertension and congestive heart failure), rose by 50%, about 23 times the rate of inflation. Another drug, Klor-Con 10 (manufactured by Upsher-Smith and used as a potassium replacement), rose 44%, or about 20 times the inflation rate.

Congress Watch has issued a new report, "The Truth Behind the Drug Industry?s Deception of America?s Seniors." This report says that the Pharmaceutical Research and Manufacturers of America (PhRMA) created the innocuous-sounding Citizens for Better Medicare (CBM) to serve as its front group. Through CBM, they have budgeted at least $65 million for television advertising since July 1999, and supplemented that with radio, print and Internet ads, along with direct mail appeals from CBM and its member groups. Congress Watch reports that the drug industry has focused the bulk of its attention on trying to prevent the government from adding drug coverage to the Medicare program, for fear that would constrain drug prices. They also mention that the industry is hardly ailing. Fortune magazine has rated pharmaceuticals as the most profitable industry in the country for most of the last three decades. In 1999, pharmaceuticals posted an 18.6 percent return on revenue, more than three times the Fortune 500 median of 5.0 percent.

Congress Watch has created a comprehensive Web site devoted to the issue of prescription drug costs. Congress Watch is a division of Public Citizen, a 150,000 member national non-profit, non-partisan, member-supported public interest group founded by Ralph Nader in 1971.

The Department of Health and Human Services (HHS) released a report about cost and access to drugs for Medicare beneficiaries. The report found, among other things, that seniors who do not have insurance for drug costs not only must pay for those costs out of pocket, but also pay higher prices than those in health plans. In 1999, excluding the effect of rebates, the typical cash customer paid nearly 15% more than the customer with third party coverage. For a quarter of the most common drugs, the price difference between cash and third parties was even higher, over 20%. For the most commonly prescribed drugs, the price difference between cash customers and those with third party coverage grew substantially larger between 1996 and 1999.

The report also found that drug benefits, where available, are becoming less generous. Cost sharing for prescription drugs is increasing and that caps on coverage are becoming more common and are being set at lower levels. 86% of plans have annual dollar limits on drugs, including 70% of plans with annual caps of $1,000 or less, and 32% with caps of $500 or less per enrollee - up from 35% and 19% in 1998. Of those employers that still offer medical coverage, the survey found that 40% are requiring Medicare-eligible retirees to pay the full cost of their benefits, compared to 28% in 1995.