Soaring Costs of Prescription Drugs

July 20, 2004

The cost of prescription drugs keeps going through the roof, making needed medicines increasingly unaffordable especially for the 65 million Americans (including some 15 million seniors) without any prescription insurance.

According to a recent study done by "Families USA" (a health care advocacy group), the cost of prescription drugs are rising at a rate of 300% to 400% faster than the average inflation rate.

In 2002, overall national spending on prescription drugs increased by 15.3% with more than one-third of these costs due to prices increases. For seniors, the problem is even worse. Over the last 3 years, the prices of the top 30 brand name drugs dispensed to seniors increased by 22%; in 2003 alone these prices rose 6.5% or more than 4.3 times the inflation rate. Several frequently prescribed drugs rose between 15% and 20% in price.

Since most seniors live on fixed incomes (many rely solely on Social Security payments and find themselves below the poverty line), the increase in drug costs often means a choice between health and other necessities such as food.

The recently passed and highly advertised legislation to include a prescription drug benefit in Medicare will not solve the problem. In fact, in many cases things will get worse.

To begin with, the Medicare drug benefit will not begin until 2006. After that seniors will pay more than $420/year in premiums and a total of $4,020 out of the first $5,100 in drug expenses.

What is more, many companies are using the new legislation as an excuse to eliminate prescription drug insurance currently provided to retirees. A recent government study estimated that in 2006, employers will reduce benefits or eliminate them altogether for as many as 3.8 million retirees. This number is expected to increase in the following years.

This is a national disgrace. In a country which boasts of an advanced health care infrastructure, tens of millions of Americans cannot afford needed medicines.

This situation must be changed so that everyone is guaranteed, by right, the best available health care, including prescription medicines, free of charge.