HEALTH
Drug Firms Cooperate in U.S. to Offer
Discounts for Low-Income Seniors
By GARDINER HARRIS and SARAH LUECK
Staff Reporters of THE WALL STREET JOURNAL
Seven drug companies, in an effort to tame consumer confusion and
ward off pricing regulation, plan to jointly issue a prescription card
that will allow low-income seniors without drug benefits to get 20% to
40% discounts on medicines.
Seniors who earn less than $28,000 individually or who, as a couple,
earn less than $38,000 will be eligible for the Together Rx Card,
which will be unveiled Wednesday. There are nearly 11 million
seniors in the U.S. who participate in Medicare, the federal
health-care program for the elderly, who will be eligible for the card,
the companies estimated. The card will provide them access to
discounts on more than 130 commonly needed drugs. Most of
Medicare's 40 million participants have at least some drug coverage,
such as private insurance or Medicaid, making them ineligible for the
new card.
The announcement is part of a string of similar efforts by drug
companies, pharmacy chains and managed-care organizations. But
Together Rx tries to address the confusion and difficulty that so many
disparate programs have presented for seniors.
"It's not ideal for low-income seniors to have seven or eight different
cards and have them try to figure out which one to use every time they
get a prescription," said Bob Ingram, chief operating officer of
GlaxoSmithKline PLC, one of the participants in the Together Rx
plan.
In addition to GlaxoSmithKline, Novartis SA, Abbott Laboratories,
Aventis SA, Bristol-Myers Squibb Co., Johnson & Johnson and
AstraZeneca PLC all agreed to join the Together Rx card. The card
will be administered by McKesson Corp., a drug wholesaler based in
San Francisco that has electronic communication with most
pharmacies in the U.S.
The companies are hoping to be joined in their program by the rest of
the drug industry as well as by most pharmacy groups. But Pfizer Inc.
and Eli Lilly & Co., which have both announced their own cards,
were noticeably absent from the list of participants.
Meanwhile, Merck & Co. Tuesday reaffirmed its commitment to its
patient-assistance program, which can deliver free medicines to the
homes of those in need.
Craig Fuller, president and chief executive of the National Association
of Chain Drug Stores, said he hoped the drug companies would one
day fold their card into his organization's Pharmacy Care One Card, a
similar attempt at a unified prescription card. The chain stores' effort
relies on drug makers' participation, although so far none of them has
joined in.
The Together Rx program will depend on participation of pharmacies.
In a comment echoed by others, Rite Aid Corp. said it would review
the details of the plan and decide soon how to respond.
The card is part of the drug industry's broad defense of its freedom to
set prices in the U.S. Numerous efforts over the years have sought to
rein in rising drug costs, and one approach has been to include drugs
in the federal Medicare program. Both the Clinton and Bush
administrations have made a Medicare drug benefit a priority. Many
lawmakers had promised to provide a prescription-drug benefit in
Medicare this year, but political differences over how much a benefit
should cost and how it should be delivered are making it increasingly
unlikely that the House and Senate will forge an agreement. The
industry, while supporting a benefit, worries that some proposals
could lead to price controls.
Some in Washington worry that private discount cards are taking the
pressure off Congress to pass a drug benefit; others say it will draw
more attention to the issue. The drug companies' card is "going to help
people save a little money, but it's not a sufficient answer to the
problem," said John Rother, policy director for AARP, the advocacy
group for older Americans.
Mark McClellan, a top White House health adviser, called the drug
companies' card a "very positive development." He added: "This is the
kind of thing we'd like to make as widely available to seniors as
possible" with the administration's card proposal.
Patients who apply for the card would have to state their eligibility but
no one will check to see if their statements are true. Cards can be used at participating pharmacies.
Applications can be made over the Internet, through an 800 number or from forms dropped at doctors'
offices.
The discounts will vary by income and manufacturer. Some companies will grant greater discounts to
those with incomes 200% above the poverty line or less -- or $18,000 a year for individuals, $24,000
a year for couples. Novartis, for instance, will offer all such individuals any prescription for a $12
copayment. Bristol-Myers's copayment will be $15. GlaxoSmithKline has set a $5 or $10 copay,
depending on the drug. Some drugs will be free to the poorest.
Cancer drugs, AIDS drugs and certain hospital drugs won't be part of the discounts because Medicare
and other programs currently cover them.
Competing Cards
Drug companies are offering an array of discount-drug programs to lower-income senior citizens.
Card/Program
Companies
What's Offered
Eligibility
Cost
Together Rx
Abbott Labs; AstraZeneca;
Aventis; Bristol-Myers Squibb;
GlaxoSmithKline; J & J; Novartis
Savings of 20% to 40% off
pharmacy prices of more
than 130 prescription
drugs.*
Medicare enrollees without
prescription drug coverage.
Income up to $28,000, or
$38,000 for couples.
Variable
Living Share
Pfizer
30-day supply of many
Pfizer medicines.
Medicare enrollees without
prescription drug coverage.
Income up to $18,000, or
$24,000 for couples.
$15
LillyAnswers
Eli Lilly
30-day supply of any Lilly
retail drug.
Medicare enrollees without
prescription drug coverage.
Income up to $18,000, or
$24,000 for a household.
$12
Patient Assistance
Program
Merck
A year's supply of many
Merck drugs; home
delivery.
No prescription drug coverage,
regardless of age.
None
*For individuals/households earning less than $18,000/$24,000, medicines could be free or require $12-$15 monthly fees.
Source: WSJ research
Write to Gardiner Harris at gardiner.harris@wsj.com and Sarah Lueck at sarah.lueck@wsj.com
Updated April 10, 2002 5:38 a.m. EDT |
