29
Apr
2006
Prying Canadian prescriptions from Granny’s cold, dead fingers
Gun control and Social Security may be third rails in US politics, but seniors seeking a better deal on prescription drugs are fair game. According to a story last month in the Boston Globe, US customs agents have increased seizures of mail order prescription drugs headed to the US from pharmacies in Canada. In response, some states are taking measures to protect their seniors from the federal government.
The stepped up action against low-cost prescription drugs began days after Congress passed the new Medicare prescription benefit, but a Customs spokeswoman told the Globe that the timing was pure coincidence. ”There’s absolutely no connection with this enforcement of federal law with Medicare Part D at all. That’s just some kind of misunderstanding.”
Customs agents are apparently not seizing Canadian prescription drugs from seniors and others who make the cross-border trip themselves; it’s only those who opt for the convenience of mail order who are affected.
Dr. Peter Rost at the Huffington Post brought us this story. Among other ironies, he notes that the parents of Health and Human Services chief Mike Leavitt quietly dropped out of the new Medicare plan shortly after their well publicized enrollment.
Of course you can expect someone like Mike Leavitt to help his parents sort through the dozens of private insurance plans offering coverage. The Leavitt parents joined the program last fall with lots of fanfare and help from their son. Anne Leavitt, 73, was quoted in the Salt Lake Tribune touting her enrollment as smooth, and a guaranteed money-saver.Leavitt’s father was in charge of a health insurance company, was a Utah state legislator and clearly has a son who knows the Medicare program better than most. In spite of this the elder Leavitt ended up dropping out of his first plan.
According to The Salt Lake Tribune, the Leavitts disenrolled after discovering that their Medicare drug plan enrollment would jeopardize their entire medical insurance from their former employer, the state of Utah.
Oops.
The Leavitts’ mistep echoes the confusion suffered by millions of less well-connected Medicare beneficiaries trying to sort their way through the maze of competing plans that may or may not offer better coverage than their current plans, and may not decrease prescription costs for those who don’t already have prescription coverage.
Among the states taking action to protect seniors from the federal government’s campaign against affordable Canadian prescriptions is Nevada. The Nevada legislature moved last year to allow the state’s pharmacy board to begin licensing Canadian pharmacies to legally fill prescriptions for Nevada residents, a process that began last week. The rules are expected to receive final approval from the Nevada legislature next week, and the contact information for the licensed pharmacies will be posted on the board’s web site.
Predictably, the new rules were opposed by the FDA, acting on behalf of drug manufacturers, and by the National Association of Chain Drug Stores, which represents pharmacies unable to compete on price with Canadian druggists unfettered by protectionist US legislation. The latter would be better advised to lobby Congress to strip the Medicare benefit of the prohibition against negotiating a program-wide discount on drugs approved for Medicare coverage, a measure designed specifically to protect drug industry profits.
While other states are considering legislation along the lines of the Nevada program, more than 20 are suing dozens of pharmaceutical firms for price gouging. Hawaii’s attorney general recently filed a suit charging 44 drug companies with “an illegal and deceptive scheme” to artificially inflate prices covered under the state’s Medicare and Medicaid rules.
A lawsuit filed by the attorney general’s office alleges the companies came up with “phony” wholesale prices that made the state and Medicare consumers pay “grossly excessive prices.”“The taxpayers of Hawai’i have been swindled by certain drug manufacturers falsely inflating prices in our Medicaid programs and to Medicare beneficiaries,” said Lillian Koller, director of the state Department of Human Services.
The lawsuit is against 44 Mainland companies supplying prescription drugs to Hawai’i residents and is similar to lawsuits filed by about 20 other states against drug companies engaged in what was described as an industry-wide practice.
The painfully obvious solution to the cost of drugs in general and price-fixing in particular is allowing Medicare and Medicaid to negotiate a single price for each drug covered under the plans. That would still leave drug manufacturers free to gouge private health insurers and uninsured individuals to their hearts’ content — or at least those who live outside Nevada — but would dramatically lower the costs for Medicare, Medicaid and the states who administer the plans.
And of course the ultimate solution is a single-payer national insurance plan for every US citizen. But as we all know, welfare is unconscionable unless the objects of it are megalithic industries with powerful lobbies.
(Thanks to Avedon Carol for referring us to Dr.. Rost’s column.)

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