Fact Sheet: President Renews Call for Prescription Drug Coverage in Medicare

President Renews Call for Prescription Drug Coverage in Medicare New HHS Study Highlights Potential for Medical Breakthroughs

TODAY'S PRESIDENTIAL ACTION

• In a speech and his visit to the University of Minnesota Medical College, President Bush renewed his call for congressional action to provide prescription drug coverage and improve Medicare for seniors and persons with disabilities. The President noted that the House of Representatives took an important step toward providing affordable drug coverage by passing legislation last month, and he urged quick action in the Senate on his framework for strengthening Medicare.

• The President was accompanied by HHS Secretary Tommy Thompson, who released a new HHS report on Securing the Benefits of Innovation for America's Seniors. The report presents a detailed analysis of the major improvements in health resulting from new breakthroughs in prescription drugs. It also highlights the differences in drug coverage between the private drug insurance plans in the United States and the government-controlled plans in many other countries, and the health consequences of restricted access to new drug treatments in government-controlled plans.

BACKGROUND ON THE PRESIDENT'S FRAMEWORK FOR PRESCRIPTION DRUG LEGISLATION

The President has proposed a comprehensive framework for strengthening Medicare that includes guaranteed access to an affordable Medicare prescription drug benefit for all seniors.

• The drug benefit would allow seniors to strengthen the private health insurance coverage that helps well over half of seniors today-- seniors would not see their coverage replaced by a one-size-fits-all government plan.

• All seniors would have choices of drug coverage, to enable them to get the coverage they prefer -- no senior would be forced to accept just one or two "options" in which the government controls which drugs are covered, as under some prescription drug proposals.

• Seniors would have access to other modern benefits, like those provided in the Evercare plan and other private Medicare+Choice plans in the Minneapolis area, which help them work with their doctors to stay healthy and reduce their drug costs. For example, Evercare provides "disease management" services for seniors with multiple complex illnesses and their families, reducing the number of prescriptions they have to take and reducing their health care costs -- all while achieving patient and family satisfaction of 95 percent.

• Seniors would get help now -- they would not have to wait for relief for several more years while the full Medicare drug benefit is set up.

• The President has proposed a Medicare-endorsed drug card, supported by AARP and other senior and medical groups. All seniors will be able to use their purchasing power to get lower prices from drug manufacturers.

• The President has proposed Federal funding beginning next year to provide prescription drug assistance to low-income Medicare beneficiaries, through existing state programs or the Medicare drug card. Up to 3 million seniors who do not have drug coverage now would get help.

• The President has proposed new Medigap options that provide more affordable drug coverage, and fair payments for Medicare+Choice plans so they can continue to provide drug coverage and other modern benefits for seniors.

• All of these proposals for immediate help are reflected in the House-passed Medicare bill.

• These proposals are part of a comprehensive framework that would give seniors more reliable and affordable options for health care coverage, that would keep Medicare's benefits financially secure for the Baby Boom, and that would allow seniors who wish to do so to keep the coverage they have with no changes.

• Most importantly, all seniors should have access to the best breakthrough drug treatments available today, and quick access to drug breakthroughs that are in the pipeline of research and development. The HHS report issued today shows the way to make that happen.

HIGHLIGHTS OF THE NEW HHS REPORT, SECURING THE BENEFITS OF INNOVATION FOR AMERICA'S SENIORS, RELEASED TODAY BY HHS SECRETARY TOMMY THOMPSON

• The HHS report includes a detailed review of recent breakthroughs in drug treatments for the following diseases: cancer, osteoporosis and hip fractures, asthma, arthritis, high cholesterol, heart disease, stroke, enlarged prostate, depression, Alzheimer's disease, diabetes, and migraines.

• For all of these diseases, the HHS report presents evidence on significant improvements in the health of older Americans that have occurred because of the drug breakthroughs -- enabling millions of seniors to live longer and more enjoyable and productive lives.

• For all of these diseases, the HHS report describes new drugs in the pipeline of research and development that can provide even greater improvements in health.

• But the HHS report also shows that access to these new treatments is not guaranteed: for all of these diseases, countries with government-run prescription drug coverage programs have limited costs by restricting access to new drugs.
• Coverage of new drugs is delayed while government-appointed committees make decisions about which patients, if any, should have access to the drugs.
• Coverage of new drugs is restricted to selected patients that meet criteria imposed by the government drug plan.
• Coverage of new drugs is denied if new drugs don't make the government formulary, or covered drug list.
• And patients who could benefit from the new drugs cannot choose to get coverage from another plan that would better meet their needs.
• In contrast, new breakthrough drugs are generally covered quickly by private insurance plans in the United States. As a result, Americans have far greater availability and use of life-saving and life-improving new drugs.
• U.S.-produced drugs account for the largest share of drug innovation worldwide: In 1999, drugs developed and produced by American companies accounted for more than 80 percent of global sales of the world's top 15 drugs.
• In the late 1990s, U.S. drugs accounted for almost 70 percent of the worldwide sales of new drugs.
• A recent report for the European Commission noted that Europe is falling behind in drug research and development, and concluded that governments should
• converge on a higher reliance on innovative management methods and on competitive mechanisms, moving away from schemes excessively based on administrative decisions and bureaucratic structures/rules in the regulation in the market."
• With all of the new breakthrough drugs in the pipeline, now is not the time for Medicare to create a drug benefit that would limit the development and availability of new drugs in the United States.

• According to the HHS report, when Medicare adds a prescription drug benefit, it should guarantee access to up-to-date coverage of breakthrough drugs. To control drug costs, seniors should not be required to join a one-size-fits-all government-run drug plan with delays, controls, and restrictions on coverage that result in worse health. Instead, seniors should be allowed to choose the private coverage that is best for them -- and to keep costs down through competition, innovation, and preventing medical complications.
• Approaches to reducing drug prices and drug costs that do not prevent patients from getting access to needed new drugs include: group purchasing arrangements to get volume discounts, "disease management" and "case management" programs which help patients and doctors coordinate care and get the most effective treatment for complex chronic diseases, and competition among health plans to allow patients to choose the coverage that best meets their needs.
• The HHS report concludes that "These steps will help keep drugs available and affordable without reducing access to valuable new treatments and discouraging innovation just at the time when the potential for innovation is greatest."

• For the complete HHS report, go to http://aspe.hhs.gov/health/reports/medicalinnovation.

• Some examples of life-saving and life-improving breakthrough drugs that are often not available in government-run drug plans, but that are generally covered by private drug plans in the United States:

• Cancer: Gleevec, the breakthrough treatment that prevents complications and death from some forms of leukemia, is not covered in New Zealand and is covered in England only after patients reach the advanced stage of the disease. Targretin (for certain lymphomas), Interleukin-2 (for kidney cancer), and Rituxan (for lymphomas) are not covered at all or covered only with significant patient restrictions in Canadian provinces like Ontario.
• Alzheimer's Disease: Aricept, which improves brain function in many patients with mild to moderate dementia, is not covered in Quebec and is restricted in Ontario.
• Arthritis: Enbrel, which enables many patients with rheumatoid arthritis to return to a normal life, is not available in Japan and not covered in Ontario or New Zealand. Celebrex and Vioxx, which have fewer side effects in many seniors than other pain relievers for arthritis, are restricted or not available in Australia, New Zealand, and many Canadian provinces.
• Asthma: Singulair, a new treatment for asthma that does not have the side effects of inhaled corticosteroids, is not covered for adults and seniors in Australia, Belgium, Finland, and many Canadian provinces.
• Depression: The first "SSRI" drug (a drug class that includes such widely used drugs as Prozac, Zoloft, Paxil) was not approved for coverage in Japan until 1999 -- twelve years after such drugs were first covered in the US. In Canada, Wellbutrin is only covered for patients who are "unresponsive" to other treatments, and even then only through a special government program.
• Diabetes: Avandia, a new oral drug that helps many diabetic patients avoid insulin injections, is not covered in Ontario or New Zealand.
• Enlarged prostate: Proscar, which prevents the common complications of prostate enlargement in older men, is not covered in Ontario.
• Gastrointestinal (stomach) symptoms and ulcers: Coverage of Prilosec, the #1 prescription drug in the United States, is limited to special conditions and time limits in Canada, and prior approval is required.
• High blood pressure: Cozaar, Hyzaar, Univasc, Sular, Diovan, and other new drug treatments are not covered or covered on a restricted basis (for example, only in patients who have "proven" to government standards that they cannot tolerate other treatments) in Canada.
• High cholesterol: Lipitor, Mevacor, and Pravachol are not on the "formulary" (covered drug list) or are covered on a very restricted basis in Australia or New Zealand.
• Infant respiratory distress: Curosurf was first covered in the US in 1999, and is still not approved for use by the Canadian government.
• Insomnia: Sonata, a drug that does not have the side effects of benzodiazepines like Valium, was first covered in the US in 1999 and is still not approved for use by the Canadian government.
• Osteoporosis and hip fractures: New "bisphosponate" drugs like Fosamax strengthen bones and prevent hip and back fractures in older women without the often serious complications of hormone therapy. But in many Canadian provinces, Australia, Italy, France, Belgium, and other countries, Fosamax is only covered in very severe cases of osteoporosis, or only after a patient has had a bone fracture that the drug is designed to prevent.

• The Appendix of the HHS Report, available at http://aspe.hhs.gov/health/reports/medicalinnovation, includes many more examples of coverage restrictions and prohibitions in government-controlled prescription drug plans.

For more information on the President's initiatives please visit www.whitehouse.gov