Saturday, November 24, 2007

Happy Holidays, Elders!

When the 109th Congress passed the prescription component for Medicare ("Part D"), to limit the federal expense it chose to include a sizeable gap in coverage (the "Doughnut Hole") rather than permit the federal government to negotiate with the big pharmaceutical companies for lower drug prices. As a result, tens of thousands of our elders have been paying for the drugs they require and paying the premiums for their Part D coverage. Neat trick, eh?

One of the consequences of this shameful Solomonic decision is that many elders are going without their medications (bad). Another is that some elders have switched over, when possible, to the generic versions of drugs when possible (good). From today's NY Times:

The Medicare doughnut hole is the federal provision that older Americans love to hate.

And that is not expected to change next year, when the doughnut hole — the nickname for a big financial gap in each person’s Medicare prescription drug coverage — gets slightly larger. If the past is a guide, many people will struggle to secure a full year’s supply of the drugs they need.

But despite the arrangement’s unpopularity with older consumers, some experts see a positive public policy trend when they peer into the doughnut hole. Because it potentially forces a Medicare enrollee to pay more than $3,000 from his or her own pocket during the gap period, the hole is helping curb growth in the nation’s drug spending by pushing people toward low-cost generic drugs. ...

About 4.2 million people reached the gap last year, according to a Wolters Kluwer study, and many of them switched to generics as a way to keep their out-of-pocket costs low. Others started using generic drugs even before they reached the doughnut hole to avoid the higher co-payments their policies charged for brand-name drugs.

In 2006, an estimated 59.6 percent of the Part D prescriptions were filled by generic drugs. By the first quarter of 2007, the most recent period for which data are available, the generic rate in Medicare had edged higher, to 61.5 percent, according to Medicare figures.

Needless to say, this unintended consequence of using generics has ruffled the feathers of PHARMA.

Billy Tauzin, the president of Pharmaceutical Research and Manufacturers of America, the trade association for brand-name drug companies, said it was clear that the Medicare program, including the doughnut hole, was helping drive the use of generic drugs. And the popularity of generic drugs is cutting into the profit margins of branded drug companies, he added.

Mr. Tauzin, a former congressman, said his group had made several proposals to Congress for shrinking the doughnut hole. Among the suggestions, he said, was to count the free drugs that companies sometimes provide to lower-income Medicare beneficiaries as part of the patients’ running total of drug costs. Doing so would make their catastrophic coverage kick in sooner.

Mr. Tauzin is not just "a former congressman," he was a congressman who voted on the Part D bill with its orders against negotiated drug prices and then quickly walked into his new, higher paying job for PHARMA. Nice work, eh?

There's nothing wrong with using generics rather than the more expensive brand-names, but that's not always an option. When that happens, a less expensive and often less effective drug replaces the original prescription, even to the point of using aspirin (with its attendant side effects) instead of a prescription blood thinner.

I don't have much sympathy for PHARMA members who are now faced with a smaller bottom line: they bought the congressional vote and should have to live with the consequences, unintended though they may be. My sympathies are for the elders who are facing the doughnut hole and paying the premiums at the same time. This leaves our elders with some rather Draconian choices: medicine or home heating, medicine or food.

There is absolutely zero chance that the 110th Congress will address the issue, especially with the current president who has suddenly discovered his veto pen when it comes to legislation which might actually help segments of the population not given to making huge campaign donations.

Hopefully the next Congress and the next president will be of a different sort than the current crop. But that hope won't feed, heat, or properly medicate our elders, and that is shameful.

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