- The Washington Times - Thursday, April 29, 2004

If they really care about getting cheaper drugs for seniors, why are some politicians and so-called consumer groups such as Families USA in effect discouraging seniors from signing up for immediate discounts and drug benefits in order to build support for price controls and the forced importation of drugs?

Next week, the Department of Health and Human Services’s Medicare drug card discount Web site is going to go “live,” giving seniors the first chance to shop for the lowest prices for drugs under the new program — which also includes about $8 billion in cash, about $4 billion in discounts and billions more in direct benefits from biotech and pharmaceutical companies themselves. All told, millions of seniors will wind up paying less for drugs than they pay in Canada, or even next to nothing.

Yet, critics of the card and groups like Families USA are actively telling seniors they won’t save any money because any discounts will have been eaten up by huge price increases now and in the future. They — along with the governors of many states — are instead pushing for the importation of medicines at government-controlled prices or for outright federal-price regulations.

Here are the facts about the Medicare drug discount program. All seniors are eligible to sign up for cards providing average discounts of about 20 percent on all drugs. In addition, 10 million seniors making less than $16,000 a year will get $600 to buy drugs and, depending on the card they choose, can be automatically enrolled in drug and biotech company programs that will cover the rest of the cost of medicines for about $25 a month or less.

The Families USA response? A “road show” that includes as its centerpiece a video narrated by Walter Cronkite that tells seniors that drug companies have raised drug prices by 15 percent a year, while drug discounts will only be 10 percent a year. The implicit message to old folks: Why bother signing up? Wait for the price-control revolution and drug imports to see the “true savings.”

Too bad the Families USA line is not true. In fact, two independent studies — one by the Bureau of Labor Statistics (BLS) and the other by drugstore.com — show that retail drug prices for all medicines (BLS) went up by 2.8 percent and the 50 most commonly used drugs (according to drugstore.com) went up in the last year at about the same rate.

And the claim that importation will save up to 80 percent more than a Medicare discount card? Families USA based its claim on retail prices for those 50 most commonly prescribed drugs for seniors last year. A closer look, though, finds that 36 of them will be cheaper in America with the discount card. Why? Some drugs can have a cheaper, generic version available, which Families USA ignored. Others have lower prices once you add in shipping and handling charges from Canadian pharmacies. And still others will be cheaper under the Medicare drug discount program. These drugs include such popular ones as Lipitor, Norvasc, Zoloft and Evista.

One can expect liberal groups to engage in such tactics. But there are Republican governors who are also taking a similar stance, failing to help their state’s seniors and protect American jobs because they find importation a sexier issue. Gov. Craig Benson of New Hampshire, a Republican, for example, has posted Canadian drug prices on his state Web site. But his staff still hasn’t given me a straight answer in response to my e-mailed question about whether they would post information showing seniors that most drugs would wind up being more affordable and legally purchased using the Medicare card.

The president and most Republicans have launched a great idea with the discount drug card and market-based pricing plan. It’s time to discount those who will tear it down in the days ahead. It seems nothing breeds fear or zealotry like the other guy’s success.

Robert Goldberg is director of the Center for Medical Progress at the Manhattan Institute.

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