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Report: Top Medicare Part D Drug Prices on the Rise

By Mary Agnes Carey, CQ HealthBeat Associate Editor

April 18, 2007 -- As Senate Republicans defeated a proposal (S 3) to allow the government to negotiate Medicare prescription drug prices, a leading consumer group said Wednesday that prices are climbing rapidly for some of the drugs beneficiaries use most often.

Study findings from Families USA found that the median Part D drug price increased 9.2 percent last year for the top 15 drugs prescribed to seniors.

For instance, from April 2006 to April 2007, a year's supply of Celebrex, an anti-inflammatory drug, rose from $946.44 to $1033.32, an increase of 9.2 percent, while the price for Fosamax, used to treat osteoporosis, climbed from $727.92 to $806.16, or 10.7 percent. And Lexapro, a drug used to treat depression, rose from $706.20 to $812.16, or 15 percent, according to the report.

"Contrary to promises made last year by the administration, Medicare Part D drug prices skyrocketed last year," Families USA Executive Director Ron Pollack said in a news release. "Those fast-rising prices are making drugs increasingly unaffordable for seniors and are fleecing America's taxpayers."

The report, released at Wednesday's news conference, examined changes in the lowest drug prices charged to seniors among plans offered by the five largest insurers: United Healthcare, Humana, WellPoint-Unicare, Member Health, and WellCare. Combined, the groups enrolled almost two-thirds of all Part D beneficiaries. "Since these plans have the largest enrollment, they are in the best position, among Part D plans, to secure optimal prices," Families USA said in a news release.

The findings are based on prices that insurers reported to the Centers for Medicare and Medicaid Services (CMS). The consumer group compared the lowest available Part D price for each drug in April 2006 with the lowest available price for the same drug in April 2007.

CMS Spokesman Jeff Nelligan said the report "neglects the generous cost-sharing assistance provided by the Part D benefit and contradicts other analyses which suggest that Part D has insulated Medicare beneficiaries from real increases in drug prices. The fact is, 90 percent of beneficiaries are enrolled in Part D plans with flat co-pays that are locked in for the year. "

Nelligan added that "prices change as a result of market fluctuations—just as they do in Federal employees' health plans, Medigap coverage, and every other health insurance plan in which beneficiaries are required to enroll for a year or even longer."

The Families USA report was released just hours after Senate Republicans successfully blocked Democrats' efforts to pass legislation that would have allowed the Secretary of Health and Human Services to negotiate drug prices on behalf of Medicare beneficiaries.
Sen. Debbie Stabenow, D-Mich., said she and other proponents of the measure would try again.

"We're going to keep fighting and keep bringing this bill back until we can overcome the Republican-slash-industry filibuster that has been going on in the United States Senate," Stabenow said at the news conference. "We are gaining votes every time we bring this up."

Drew Armstrong contributed to this story.

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