INCREASED ACCESS TO PRESCRIPTION DRUGS

WHEREAS, runaway prescription drug costs are creating a major crisis for this country's health care consumers; and

WHEREAS, spending on drugs grew faster than any other personal health category during the last three years, averaging more than 10 percent in each of those years, with a projected 1999 increase of over 15 percent; and

WHEREAS, the United States has the highest drug prices in the world and is the only industrialized country not to have imposed some form of price controls on prescription drugs; and

WHEREAS, large drug manufacturers' average profits are 17 percent-three times those of the typical Fortune 500 company; and

WHEREAS, Americans spent $100 billion for prescription drugs in 1998-an increase of 84 percent over the previous five years, with the average price per prescription rising 40 percent over the same period; and

WHEREAS, employers are increasingly shifting portions of these cost increases to employees and retirees in the form of higher prescription premiums and co-payments; and

WHEREAS, many employers have placed restrictions on pharmaceuticals covered by health plans, and, in some jurisdictions, employers are capping prescription drug coverage at a specific dollar amount; and

WHEREAS, high prescription drug prices are particularly hard on senior citizens, since only half have prescription drug coverage of any kind for the entire year, and the wholesale prices for the 50 drugs most commonly prescribed for seniors rose 6.6 percent in 1999- four times the rate of general inflation; and

WHEREAS, older Americans have a greater need for prescription drugs than other age groups because they are more likely to suffer from chronic disease that requires drug therapy; and

WHEREAS, the Medicare benefits package does not include out-patient prescription drug coverage, even though 86 percent of seniors take at least one prescription drug each day; and

WHEREAS, only 28 percent of seniors receive drug coverage through employer-sponsored retiree plans with these benefits subject to ever-increasing co-payments, and the percentage of large employers offering retiree prescription drug coverage fell from 40 percent to 30 percent between 1994 and 1998; and

WHEREAS, most individually purchased Medigap plans do not cover prescription drugs, while the plans that do provide coverage generally cost seniors an additional $1,000 a year in premiums, have high deductibles and co-payments and place caps on coverage; and

WHEREAS, three-fifths of Medicare HMOs, once thought to be a possible solution to prescription coverage for seniors, now cap drug benefits at under $1,000 a year, with one-third of HMOs now under $500:

RESOLVED, that the AFT continue to fight to make prescription drugs available and affordable to all citizens and to insist on federal support to control their escalating cost; and

RESOLVED, that the AFT continue to educate members on issues that affect access to affordable prescription drugs and provide information on how rising drug prices are driving up the cost of employer-sponsored health care plans for workers and retirees; and

RESOLVED, that the AFT support legislation such as the Prescription Drug Fairness for Seniors Act (HR 664/S 731), which would offer individual Medicare recipients the best price currently available to the federal government or other group purchasers; and

RESOLVED, that the AFT reject the House of Representatives’ bill to privatize drug benefits for seniors and strongly support efforts by the White House and members of Congress to establish a voluntary, universal and affordable prescription drug benefit under Medicare available to every senior and disabled person, regardless of income or health status.