Lawsuits Filed to Put Brakes on Rising Pharmaceutical Costs

Published in Pawtucket Times on June, 2, 2002

In conjunction with seniors advocates lobbying Congress for Medicare prescription drug benefits and state legislatures for financial relief in paying for the spiraling costs of pharmaceuticals, the AARP and other aging groups, along with state attorney generals, are going to court to put the brakes on spiraling prescription drug costs.

Ron Pollack, executive director of Families USA, called for pharmaceutical companies to not delay generic drugs from coming quickly to market during an April forum on Capitol Hill, which was held to spotlight the anti-competitive practices of the prescription drug industry.

Delaying or preventing the widespread use of generic drugs endlessly increases costs for consumers, including Medicare beneficiaries as well as  third-party payers of health care, Pollack stated.

“It improperly extends drug monopolies that enables the drug companies to profit at the expense of everyone else,” he said.

The lawsuits bring litigated are intended to make the pharmaceutical marketplace work for everyone,” Pollack said, noting that it was ironic that the drug industry goes to great lengths to prevent the regulation of prices in the name of promoting a free market.

Legal initiatives are now a part of a broad AARP drive to reduce high drug costs that hit seniors hard in their pocketbooks. Washington’s largest aging advocacy group is ratcheting up its efforts to lower drug costs by joining three important cases against prescription drug manufacturers that have blocked the availability of lower-priced generic equivalents.

AARP CEO Bill Novelli has announced that his group’s attorneys will serve as co-counsel in three lawsuits that involve charges of patent abuse, suppression of generic competition and collusive agreements with generic manufacturers.

“Geriatric drugs approved by the Food and Drug Administration (FDA) at equivalents give consumers quality drug alternatives at reasonable prices,” Novelli said today. “Our aim is to help people get affordable access to the drugs they need.”

The lawsuits mark the first time that AARP attorneys will co-counsel in federal anti-trust litigation against drug manufacturers, he said.

AARP’s legal actions come against a backdrop of rising prescription drug costs. Spending for brand-name drugs has tripled in the last decade, rising from $ 40.3 billion in 1990 to $ 121.8 billion in 2000, and is expected to more than triple to $ 414 billion in this decade. Generic drugs typically cost 50 percent or less than brand-name drugs.

According to the AARP, millions of dollars are at stake annually for older Americans, who account for 42 percent of the U.S. prescription drug consumption, and other consumers who purchased prescription drugs.

The three ongoing class action cases – all in federal court – are In Re: Buspirone Antitrust litigation, In Re: K-Dur Antitrust and In Re: Tamoxifen. The AARP chose the cases because they involve important drugs that are widely used by Americans age 50 and over.

AARP attorneys are participating in these cases as co-counsel in order to ensure that a strong consumer voice is represented throughout the proceedings, including any settlement.

AARP attorneys will serve as co-counsel in the three above-mentioned cases with attorney’s associated with the Prescription Access Litigation Project (PAL), a coalition of consumer and health care organizations that was launched last year by Boston-based Catalyst.

With AARP name recognition, resources and clout, it is easy to see why Community Catalyst Executive Director Rob Restuccia is ecstatic about AARP’s decision to joint three of PAL’s class action lawsuits.

“The PAL coalition welcomes the firepower of the AARP, firepower that will strengthen our capacity to challenge the anti-competitive activities of some drug companies,” he said.

In the midst of AARP’s lawsuits here in Rhode Island, low-and moderate-income seniors and disabled will now see lower pharmaceutical costs with the passage of the three legislative proposals that would expand drug coverage of the state’s Rhode Island Pharmaceutical Assistance for the Elderly program.

A thumbs-up goes to the Rhode Island General Assembly for the wisdom of acting on these legislative proposals.

Meanwhile, at the federal level, Rhode Island U.S. Reps. Patrick J. Kennedy and James R. Langevin are gearing up for expected House debates in early June over legislation to create a drug benefit for the Medicare Program. Stay tuned for this one.

Today’s Seniors are Healthier, But More Are Uninsured

Published in Pawtucket Times on May 27, 2002

Three years ago, Alice, 60, lost her job as a graphic designer along with 143 co-workers when the Providence-based company closed. Corporate management had made the decision to  move South to tap into a cheaper labor pool.

The Pawtucket resident considered her full-time job to be a fulfilling one. Most important, she had good health insurance coverage with a very nominal monthly cop-pay of $ 80. Although she received coverage under COBRA, Alice’s monthly health care premium shot up to $ 256. When the federally mandated health insurance coverage ended, her monthly health insurance premium almost double to $ 600.

Alice never went back to full-time employment, choosing to take partial retirement in order to collect a pension. To make ends meet, she is currently teaching art classes and working part-time for a nonprofit art group. When her COBRA coverage ran out, Alice signed up for health insurance coverage from the National Association of Self-Employed. This reduced her monthly premium to $ 253; however she was left with a $ 10,000 deductible per year.

At age 60, Alice recently had a hip replacement surgery. Before the operation, the hospital required a $ 5,000 down payment, forcing her to withdraw money from her several saving accounts. Now recuperating from surgery that costs more than $ 10,000, she is about $ 5,000 in debt.

According to a new AARP report, seniors age 50 and over may be healthier and living longer overall, but their long-term health security remains at risk. In the Ocean State, Alice and other seniors have lived the findings of the report. They struggle to maintain their costly health insurance  coverage.

The report, “Beyond 50: A Report to the Nation on Trends in Health Security” is the most comprehensive picture to date of the state of health care for older Americans.

Changes in health security during the last 20 years have been driven by increased reliance on prescription drugs and other innovative technologies, changes in chronic disease and challenges in chronic care, greater longevity and functional limitations patients’ roles and responsibilities as consumers and fluctuating cost growth, the AARP report finds.

“Americans age 50-plus have the chance to capitalize on wonderful advances in longevity. But they need a chain of dominoes to fall right – initial good health, adequate health care coverage, affordable quality care that’s easy to access and a system that encourages informed decision making,” said AARP CEO Bill Novelli.

“Missing one of these dominoes puts a person’s – and a generations – whole health security at risk,” says Novelli.

At age 50, Americans can expect to live another 30 years, the report notes, almost nine years longer than expected in 1900, and fewer are suffering disabilities. The aging baby boomers are healthier with fewer smoking and more using preventative services and trying to exercise.

The AARP report also found that more people age 50-64 are uninsured than in the past and those with insurance are worried about losing what coverage they have or receiving fewer benefits in the future because Medicare doesn’t cover prescription drugs and few Americans have long-term care insurance.

“It’s a good news/bad news report,” said Novelli. “Personal behavior can make a positive difference in people’s health and longevity, but health care for Americans age 50-plus is harder to get, to pay for and to manage. The health care system is a non-system.”

The AARP report calls for the public health system to continue to promote positive health behaviors.

In addition, the general lack of long-term care coverage and the increasing inadequacy and instability of health care coverage for portions of the 50-plus population must be addressed by policy makers.

In 2000, 39 million Americans were uninsured. Out of this number, 5.2 million were seniors between  ages 50 to 64. With the graying of America’s population, the Rhode Island congressional delegation must work closely together to craft meaningful legislation that will create a safety net for the underinsured and uninsured. It’s now time to fix this long-debated policy problem once and for all.

Every senior must have access to affordable health care services. For me, that right is as American as apple pie.

Inaction on RIPAE Proposals Would Be a State Tragedy

Published in the Pawtucket Times on May 20, 2002

Lawmakers are rushing to finalize the state’s business, hoping to adjourn as early as the end of May.

With thousands of proposals in the legislative hopper, each representative was directed by House leadership to choose three of their own sponsored bills to push for in the Senate.

All legislative proposals that do not make the “priority” lists are as good as dead for the year.

At press time, one proposal, Pharmaceutical Assistance for the Elderly Program (RIPAE) moves closely to passage.

The House Finance Committee has put the proposal (H 7291) into the state budget article. Susan Sweet, a consultant and aging advocate said she expects full House passage of the state budget article by the end of the week.

Once passed by the House, the state budget article goes to the Senate for their consideration and approval. Sweet told All About Seniors that she believes that the Senate will quickly pass the budget, too.

With passage, the final state budget will be  forwarded to Governor Lincoln Almond.

Under H 7291, the state Department of Human Services would seek a waiver from the federal government, allowing Rhode Island to use Medicaid funding to pay for prescription drugs for low-income seniors with incomes up to $ 17,720 and couples with incomes up to $ 23,880.

The legislative proposal, authored by Lt. Governor Charles Fogarty and sponsored by Rep. Constantino and House Finance Chairman Gordon Fox, would enroll about 90 percent of the 37,000 seniors now enrolled in RIPAE. Because seniors would now qualify for prescription drug coverage under Medicaid all U.S. Food and Drug Administration (FDA) drugs would be covered not just those currently covered by RIPAE.

Seniors would pay a small copayment rather than the 40 percent co-payment currently charged.

With the passage of the state budget article, then “cleanup” begins on all legislative proposals, Sweet noted, adding that the two other RIPAE proposals have not been acted upon yet.

These legislative proposals would make prescription drugs more affordable to seniors and persons with disabilities who are not covered by the Medicaid waiver.

One bill (H 7290) would allow seniors enrolled in the RIPAE program to buy prescription drugs not currently covered by RIPAE at the discounted state price.

The other (H 7524) would allow low-income disabled persons on Social Security Disability Income who are between ages of 55 and 65 to become members of RIPAE and purchase prescription medications at the state discounted rate. Under booth, the state would be able to obtain the manufacturer’s rebate available through RIPAE.

Sweet along with other aging advocate groups, has called on the Rhode Island General Assembly to pass the three RIPAE proposals, which don’t cost the state one penny.

Not acting on them will continue a tragic trend that is well-documented in Rhode Island and nationwide.

That is, the high cost of prescription drugs forces many seniors on fixed incomes into not taking their prescribed medications at all or using only partial doses.

Moreover, noncompliance can lead to unnecessary hospitalization, nursing home admission and premature death.

Even in the shadow of a huge state budget deficit, lawmakers have the opportunity to lower the spiraling out-of-pocket costs of costs of prescription drugs, at no cost to the state.

The Ocean State is now posed to enact sound public policy that will result in no fiscal impact to state coffers.

If Congress is not ready to tackle this aging policy issue through the creation of a Medicare pharmaceutical benefit, then the Rhode Island General Assembly must take the lead and pass the three RIPAE proposals.

Simply put, it is the right thing to do on behalf of older and disabled constituents.