New Drug Benefit Questioned - 11/28/05
Democrats' Report Cites Lower Prices From VA and in Canada

Article from the Washington Post Online
 

The new Medicare drug benefit fails to deliver drug prices as low as those found at the Department of Veterans Affairs, in Canada and at high-volume U.S. pharmacies, a congressional report said yesterday. It was challenged by a Medicare official as flawed and misleading.

The report, released yesterday by the Democratic staff of the House Government Reform Committee, found that the average prices of 10 popular drugs being offered to Medicare recipients through 10 well-known insurance plans were 80 percent higher than prices negotiated for the government by Veterans Affairs. The Medicare prices were 60 percent higher than average prices paid by Canadian consumers, the report found. And they were about 3 percent higher than those paid by consumers who got their drugs at Costco stores or online through Drugstore.com.

"The prices offered by the Medicare drug plans are higher than all four benchmarks, in some cases significantly so," the report concluded. "This increases costs to seniors and federal taxpayers and makes it doubtful that the complicated design of Medicare Part D provides any tangible benefit to anyone but drug manufacturers and insurers."

Gary Karr, a spokesman for the Centers for Medicare and Medicaid Services, said the report was disappointing but not surprising. "It's disappointing because it's selective and misleading, and because of the timing," Karr said. Full Story...

When Health Insurance Is Not a Safeguard  - 11/28/05

CAMBY, Ind. - Until the fourth trip to the hospital in 1998, Zachery Dorsett's parents thought their son was an average child who was having trouble getting over a passing illness. He was 7 months old, and it was his second case of pneumonia.

The Dorsetts, Sharon and Arnold, were concerned about Zachery's health, but they were not worried about the financial consequences. They were a young, middle-income couple, with health insurance that covered 90 percent of doctors' bills and most of the costs of prescription drugs.

Then the bills started coming in. After a week in the hospital, the couple's share came to $1,100 - not catastrophic, but more than their small savings. They enrolled in a 90-day payment plan with the hospital and struggled to make the monthly installments of nearly $400, hoping that they did not hit any other expenses.

But Zachery, who was eventually found to have an immune system disorder, kept getting sick, and the expense of his treatment - fees for tests, hospitalizations, medicine - kept mounting, eventually costing the family $12,000 to $20,000 a year. Earlier this year, the Dorsetts stopped making mortgage payments on their ranch house, in a subdivision outside Indianapolis, because they could not afford them. In March, they filed for bankruptcy. Full Story...

 

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