Tag Archives for AARP CEO Bill Novelli

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.

Aging Baby Boomers Woefully Unknowledgeable About Services

Published in Pawtucket Times on December 31, 2001

Are you a savvy shopper for services that you might one day need to purchase?

Many Americans are especially savvy when they purchase cars, electronic equipment or clothing.  But most are not when it comes to their knowledge of purchasing needed long-term care services, says a report recently released by AARP.

More than half (60 percent) of aging baby boomers age 45 plus say they are at least “somewhat familiar” with long-term care services currently available. However, they are woefully uninformed about the costs of, and funding sources for, long-term care services.

Yet with the graying of America’s population, the need for these services is expected to increase in the upcoming years. According to the 2000 U.S. Census Bureau projections, today’s 65 or older population numbers are expected to double to about 70 million in 2030, and the 85 and older population will also nearly double to about 8.5 million.  Those 85 years and older will be in the greatest need for nursing facility care.

“With the onset of the aging demographic revolution, essential that the general public not only learn about the long-term care options but understand their costs, and begin planning for their future care requirements,” said AARP CEO Bill Novelli. “Unfortunately, most of us pay little attention to the cost of such care until we or our loved ones needed it.  AARP sees  our role as informing and assisting people to make good choices.”

The AARP telephone survey asked a random sample of 1,800 Americans ages 45 and older questions  designed to measure their knowledge and understanding of the continuum of long-term care services, ranging from in-home care, assisted living to nursing home care.  In addition, to the national survey, five state-specific surveys were conducted with a random sample of 400 people age 45 and over in California, Florida, New Mexico, Washington and Wisconsin.

The survey findings suggested that aging baby boomers and seniors are generally not familiar or knowledgeable about the costs of long-term care services.  Only 15 percent could identify the cost of nursing  home care within plus or minus 20 percent of the national average of cost (about $ 4,654 per month).  Even 24 percent of those participating in the survey admitted that they did not even know the cost. And that’s not all – 51 percent estimated the cost too l ow.  So much for those savvy shoppers.

As for assisted-living facilities, one in four (27 percent) were able to come within a plus or minus 20 percent of the estimated median cost of care in an assisted-living facility while 38 percent said they did not know the national estimated median cost for assisted living per month, ranging from $ 2,000 and 2,500.

Meanwhile, survey participants continued to reveal their lack of knowledge by being generally unaware of how much an in-home visit from a skilled  nurse or aide costs.  The average Medicare reimbursement is $ 109 per a skilled nurse visit and $ 64 for a home visit by an aide.  The survey findings reported that they gave a wide range of answers, with no real consensus.  Thirty three percent even admitted they did not know the cost.

So, what about the aging baby boomers knowledge of long-term care insurance, one viable option to pay for the cost of long-term care services? About 31 percent said they have insurance that covers the cost of long-term care, when they probably didn’t.  Maybe it’s time for people to read the very small print in their insurance policies.  The Washington, D.C.-based Health Insurance Association of America estimates that only about 6 percent of Americas purchased such insurance.

Additionally, the survey respondents who said that they had insurance coverage for long-term care services were more likely to say they feel better prepared to meet the financial challenges of paying for care than those who say they do not have coverage (7 percent versus 39 percent).  This finding suggests that people who say that they long term care coverage when they do not may have a false sense of financial preparedness.

According to the new study, there is also a discrepancy between what people think Medicare and Medigap cover and what they actually cover.  More than half (55 percent), including those who say they are “very familiar” with long term care (58 percent), believe Medicare covers long-term nursing home stays.  And nearly a quarter say they would rely on Medicare to pay for such stays.  This is not the case.  Medicare does not cover long-term care nursing home stays.

The survey noted that 41 percent thought Medicare also covered assisted living care and more than 34 percent know whether it does or does not.  Medicare does not pay for assisted living.  And 57 percent correctly said that Medicare covers the cost of in-home visits from a skilled nurse. However, many respondents did not understand the difference between a home visit from a skilled nurse and a home visit by a home health aide.

More than half (52 percent) thought Medicare covers aide visits. In fact, Medicare covers only home health aide services for care that is medically necessary, not custodial care.

Kathleen S. Connell, AARP State Director, notes that this research study highlights the big gap between consumers understanding of long-term care services and its associated costs.  She adds that the findings reveal a great deal of confusion as to what long term care services are covered by Medicare and Medicaid.

“Aging baby boomers are now facing decisions regarding the purchase of long-term care services for their older parents. They will also be forced to deal with their need for services as they age and as longevity increases,” Connell says. “Consumers need to be come better informed about what Medicare and Medicaid pays for available long term care options for services that are actual costs of care.  They need to investigate different long term care insurance options, too,” she urges.

In Rhode Island there is a general recognition in agencies assisting seniors of the need for educating consumers and putting information into the hands of people who need it, Connell notes, adding that information specialists are available in local senior centers to assist in this effort.

Don’t wait until a sudden health crisis forces you to shop around for long-term care services.  Start today Become a savvy shopper by increasing your knowledge and understanding of different long-term care service options and  their associated costs.  Learn more about government financing programs, specifically Medicare and Medicaid, and private senior financing with long-term care insurance and Medigap policies.