What a nice change. We have the president and both parties agreeing to help senior citizens deal with the high cost of prescription drugs. From what I can gather from all the blather emanating from Capitol Hill, the solutions are somewhere in the vicinity of ... Medicare pays, seniors pay a monthly fee, the government pays for some.
Looks like everybody pays, either directly or in taxes. Correct me if I'm wrong. The problem is the high cost of prescriptions. Anybody see where the Capitol gangs are going to where the high prices begin? Drug prices rose an average of 5.7 percent in 1999, as measured by the Consumer Price Index, or more than twice the level of inflation.
The pharmaceutical manufacturer's association wants government subsidies to help seniors buy prescription plans, but they show no inclination to lower prices. They say that the industry spends 20 percent of its revenues in research and development and they need the high prices to continue R & D. However, pharmaceutical firms' median profit was 18.5 percent on gross revenues in 1998. The nearest competitors were banks at 13.2 percent (another disgrace), with all other industries trailing at a median 4.4 percent.
Note the 18.5 percent is accounted for after the 20 percent they spend on R & D. (The preceding statistics are from the AARP bulletin.)
So what's the solution? How about the way Congress gets its medical coverage. They negotiate with many different companies. Why can't Medicare do the same with pharmaceutical companies or insurance companies? There are plans that pay $10 or $15 for any prescriptions. With over 40 million participants, seems that Medicare would have some leverage.
It's time American seniors stopped paying two or three times the prices that foreign nationals do for the same drugs. But will Congress look into that? I doubt it. They'll huff and puff, but as long as pharmaceutical firms pump money into party coffers, they'll do nothing. For instance in 1997-1998, the industry spent $108 million in lobbying. So once again, the people's representatives will balance the good of the party against the good of the people. Guess who'll win?
LEN GOSTIN
Carson City