Lives On the Line: The Prescription Drug Crisis

Faced with soaring drug prices, employers are shifting the burden to workers and retirees. Those without coverage must make tough choices. Something’s got to give!

By Susan Ellen Holleran

Anoka, Minnesota

It’s 6:30 a.m., and a row of cars is parked at the far edge of the deserted Kmart parking lot on Highway 10. This is the first full day of spring, but no one seems to have told Minnesota. The temperature is in the teens — below zero, if you count wind chill — and the passengers are not venturing out into the cold.

Why are we here? To board a bus that will take us across the Canadian border — 442 miles north — to purchase an essential and scarce commodity: affordable prescription drugs.

The folks waiting in their cars are just a handful of the many who have fallen through the minimal safety nets provided by the U.S. health care system. They are senior citizens who cannot afford the prescription medicines they need to survive. Two of them are mothers of AFSCME members.

Ruth Milsten — whose daughter, Marie Milsten-Fiedler, is a member of Local 3800 (Council 6) — has spent most of her life on farms. The oldest of seven siblings, she assumed major responsibilities at an early age. Milsten began college with the help of 4H scholarships, finishing her degree after her children were grown. She taught high-school home economics for a number of years. A pension and Social Security give Milsten a measure of comfort and independence, and Medicare covers most of her medical needs. But not prescription medicines, which gobble up about a quarter of her monthly income.

Mildred Burnett has more serious and even-more-expensive health problems. The mother of Local 4001 (Council 6) member Susan Burnett-Pick, Burnett underwent more than five years of chemotherapy for leukemia, which kept her sick almost constantly. "Usually, I could count on being well enough to do the laundry on Wednesday," she says. Her doctor told her about a new drug, Gleevec. Fortunately, Burnett has prescription coverage. Her medical insurer approved the new drug. The resulting difference, she says, "was like day and night." After four months, she went into remission, but she was told to continue taking the Gleevec.

Suddenly, however, the insurance carrier informed her that she had reached her lifetime-maximum limit of coverage. The drug costs $2,300 a month — much more than her budget can take. She now lives on the edge.

This trip to Canada offers Burnett hope for the future. If Gleevec is available at a price she can afford, it may put her into permanent remission. For everyone else on the bus, too, the expectation of bringing prescription costs to a reasonable level justifies the grind of a 10-hour trip in each direction.

Lobbyists ride high

Why is medicine less expensive in Canada? Because the Canadian provinces, using the incentive of bulk purchasing, negotiated with the pharmaceutical companies to secure a more favorable price — generally one-third to one-half of that charged in the United States.

Whenever a similar plan is considered by our Congress, the pharmaceutical industry unleashes its formidable army of lobbyists to beat it back. Fears that the government would be in a strong position to bargain over prescription drug costs is a primary reason for the industry’s opposition to a comprehensive Medicare prescription plan.

Medicare was first enacted in 1965, and because out-patient prescription drug coverage was not the norm, it wasn’t included in the law. Since then, break-through drugs, parti-cularly for chronic conditions, have been developed.

Seniors use 34 percent of the prescriptions filled, but only 30 percent of the nation’s seniors have coverage through former em-ployers. A third have no coverage of any kind. Over the past 10 years, the cost of lifesaving medicines has skyrocketed, leaving the ill in a desperate economic bind. Some cut pills in half so they will last longer. Others juggle their purchases, buying one prescription this month, another next month. Many must choose between medicine, food and heat — or can’t afford the prescriptions at all.

The creation of a Medicare drug benefit is a top AFSCME priority. The union recognizes that time is running out for a great many people who are unable to get the medicines they need.

Preferred list

As progressive groups like AFSCME battle at the national level to spread the availability of these great modern medicines, measures are being adopted at the state level.

"In this time of tight budgets, states are struggling with soaring expenditures for prescription drugs," says AFSCME Pres. Gerald W. McEntee. "If we find ways to contain these costs, there will be more money in their general funds to maintain high-quality public services."

In May 2000, Maine became the first to enact a law controlling prices on medications sold within its borders. This pioneering legislation allows the state to negotiate drug prices for a large pool of consumers and to levy "profiteering" penalties of up to $100,000 per action for manufacturers or distributors who charge excessive prices. The pharmaceutical industry quickly sued to prevent implementation, and the case is headed to the U.S. Supreme Court.

AFSCME is working with the Center for Policy Alternatives to introduce model legislation allowing states to lower prescription prices through negotiations with drug makers. We are supporting bills based on this model in Delaware and Hawaii, and are pushing them to the forefront in other states. Under this plan, when manufacturers agree to fair prices, their drugs go on the state’s preferred list. Patients would need advance authorization for coverage of any medications not on that list.

Illinois is participating in a demonstration project that will let low-income seniors — with incomes up to twice the poverty level ($23,222 for a family of two) — get prescription coverage through Medicaid. To join, seniors would pay a small annual enrollment fee. Medicaid would then cover most of their drug costs.

In some regions of the country, states are combining their purchasing power to exact lower prices from the manufacturers. The Pharmacy Working Group (Louisiana, Maryland, Mississippi, Missouri, New Mexico, South Carolina and West Virginia) would cover more than 1.4 million people. Annual pharmacy charges for the seven states total nearly $853 million. States in a similar northeastern pool believe that bulk purchasing could cut costs by 40 percent.

Although those efforts show that the states understand the seriousness of the prescription drug problem, their collective impact so far is limited.

O, Canada

U.S. Sen. Mark Dayton (D-Minn.) strongly supports a Medicare prescription-drug program. Frustrated by congressional inaction, he donated his Senate salary to the Minnesota Senior Federation (MSF) to org-anize prescription-buying bus trips to Canada. We are on one of those expeditions.

About six hours into the trip, bound for Winnipeg, Manitoba, the bus pulls off the highway at Moorhead. Bad news: The Canadian physician we were supposed to meet has been told that his liability insurance would not cover us. So he won’t see us. For the next two hours, we sit in the chilly bus — wondering whether the trip will be scuttled — as the MSF staff tries to negotiate an alternative.

It’s a tense time; many on the bus are running out of their medicine. Finally, with a new doctor and a pharmacy arranged, we continue on to Winnipeg. The doctor examines patients into the night, and the pharmacy delivers boxes of medicine the next afternoon.

We get back to Anoka just after midnight, bone weary but counting ourselves lucky. We are healthy enough to go on the two-day trek; and by taking it, most of us have cut our prescription costs at least in half. Almost as good is this bit of news: In the future these medicines can be ordered by mail.

Obviously, bus trips are not the real solution to America’s prescription-drug crisis, but they do help individuals cope with their immediate problems. They are also a mobilizing tool. Many of us came on the trip believing it was somehow our fault that we couldn’t afford our medicine. Now we know we are not alone — that we must speak out forcefully to bring about change.

Not Just Retirees

Tacoma, Washington

A miracle drug was the answer to a little boy’s prayer. Just two years ago, Joel Wippick recalls, his six-year-old son, Jaan, asked God to "make papa better so we can do the things we used to do."

At 33, Wippick suffered from psoriatic arthritis — a particularly crippling strain of the common ailment. He was in constant pain. It was excruciating when Jaan or his younger brother, Johann, bumped into his feet as they played in the living room. A library technician at Evergreen State College in Olympia and a member of Local 443 (Council 28), Wippick had difficulty shelving books because his hands lacked strength and mobility. He would soon be totally disabled.

Then Jaan’s prayer was answered. Wippick’s rheumatologist recommended Enbrel, a brand-new arthritis drug. The doctor had to convince Wippick’s insurance carrier to cover the cost, but finally he succeeded.

"A week and a half after starting the Enbrel," says Wippick, "I came home from work, picked Jaan up by his feet and swung him around the living room — something I hadn’t been able to do for months, if not years." He also could hold his toothbrush and curl his fingers around the steering wheel of his car.

Last year, however, it looked as if Wippick would lose his "miracle." The state planned a massive shift of medical costs to its employees. Their insurance premiums and co-payments would rise dramatically. For Wippick, out-of-pocket prescription expenses would have gone from $30 a month to $500 — almost as much as his rent.

Across the state, Council 28 members fought back. They rallied in Olympia and demonstrated at their worksites. They spoke out at town hall meetings and lobbied their legislators and the governor. When their concerns still were not heard, they mounted a one-day, statewide strike. It worked. The state withdrew the proposal, and Wippick’s coverage is secure — at least for now.

Where Does the Money Go?

The pharmaceutical industry consistently opposes programs it fears will limit its pricing options. The industry argues that any pressure to limit the amount of money it charges — especially for newer drugs still under its patent — will force cutbacks on research and development, and keep scientists from finding new cures. In fact, by the drug companies’ own records, only 20 cents out of every dollar goes to developing new medicines — and that 20 includes the multi-billion-dollar, government-funded research. Drug production costs about 22.5 cents. Net profits (after all other expenses) amount to a hefty 18.5 cents.

So don’t feel sorry for the pharmaceutical industry. Fortune magazine ranked it as the most profitable in the world with a median return on revenue four times that of the average Fortune 500 company. Those profits are increasing by double-digit percentages every year — just like the costs of prescription drugs.

Here’s the hidden number in the equation: 30 cents out of every dollar goes to advertising and marketing. In addition to raising the cost of prescriptions, ads on TV and in publications lead consumers to demand brand-name drugs — which are much more expensive and often less effective than older medicines no longer covered by patents.