September 25, 2008, — Seniors who switch between low-cost generic drugs and the original products based on who’s footing the bill are likely driving up the cost of the government’s Medicare drug plan, according to a new study.

Figures released Thursday show seniors are more likely to ask their pharmacist for generic medications when they are paying, but choose the more expensive originals when the government is covering the costs.

The study was published by Medco Health Solutions Inc., a drug benefit manager that handles prescriptions for about 20 percent of Americans. Prescription benefit managers earn more money when patients choose cheaper medications.

While the Medicare drug benefit has pushed up the country’s overall health care spending, the program’s budget has actually come in below estimates, which federal officials attribute to a greater use of generic drugs and competition among insurance companies.

Generic drugs are medically indistinguishable from the original products, and can cost up to 80 percent less. They account for two-thirds of all prescriptions dispensed in the U.S, according to research firm IMS Health.

However, the figures from Medco suggest some patients are still more comfortable taking medicines from the original manufacturer.

“It may be a question of education, that some people simply believe brand-name drugs work better than generics,” said Tricia Neuman, a vice president with the Henry J. Kaiser Family Foundation. Research also shows that doctors often don’t talk about the potential cost savings of generic drugs, she added.

Kaiser, a nonprofit research group, estimates the average out-of-pocket expense for seniors in Medicare taking generic drugs will be $5.32 this year, nearly six times less than the $29.86 paid by seniors taking branded drugs listed by insurers.

Despite the potential cost savings, Medco found that nearly two-thirds of prescriptions initially filled by patients in Medicare were for branded medications.

The majority of seniors only switched to generics after they reached the point in spending when users must pick up the whole cost of prescriptions.

“Medicare beneficiaries become acutely aware of the cost difference between brand-name and generic drugs and most make the switch,” said Medco Chief Medical Officer Woody Eisenberg.

But Medco also found that when seniors’ drug costs reached the “catastrophic” phase and are again covered by Medicare, 59 percent of prescriptions are for branded drugs.

An official from the federal Centers for Medicare and Medicaid Services said the agency could not confirm the figures cited by Medco.

Overall, the federal government and beneficiaries through their monthly premiums will spend about $47 billion on the Medicare drug benefit this year.


Congress Debates Bottled Water

Critics Tell Lawmakers Bottled Water Hurts Environment; Industry Says Consumers Deserve Choices

Reviewed by Louise Chang, MD

WebMD Health News, by Todd Zwillich, September 2008 — Environmental and consumer groups are urging closer scrutiny of bottled water. The groups say Americans are wasting billions of dollars while causing environmental damage — and adding few health benefits.

The calls come as Congress begins to consider stricter labels that alert consumers about the source and potential environmental impact of the products.

“The public should not assume that water purchased in a bottle is better regulated, more pure, or safer than most tap water,” says Mae Wu, an attorney with the Natural Resources Defense Council.

Wu and others made their comments to lawmakers at a hearing on Capitol Hill.

Close to 40% of bottled water sold in the U.S. comes from municipal sources, the same place tap water comes from. Wu says nearly all public tap water is filtered before it’s distributed to homes and businesses.

Wenonah Hauter, who heads the consumer group Food and Water Watch, says a gallon of bottled water can cost between $8 and $10 in some areas — twice the cost of gasoline.

“Especially today, with the downturn in the economy, people have only so many dollars to spend at the grocery store. And if they’re spending that money on bottled water instead of perhaps fruit or vegetables for their family, then we think that’s probably not the best decision,” she says.

Cities and Tap Water

Some cities have confronted concerns over the safety of their water supply. One is Washington, D.C., which moved to replace thousands of feet of water pipes after high lead levels were detected in city water.

But other cities have staged campaigns to promote tap water consumption and steer residents away from bottled water, which city officials say can be a burden to local waste management authorities.

New York City recently completed a nearly $1 million effort promoting the high quality of the city’s water supply, which is one of a handful in the country that does not need treatment to meet federal health standards. The city gave out 50,000 reusable water bottles to residents.

“One of the goals of the campaign was to address the myth that tap water is somehow not as safe or desirable as bottled water or sweetened beverages,” says Emily Lloyd, commissioner of the New York City’s Department of Environmental Protection.

Stephen Edberg, PhD, a water researcher and professor of medicine at Yale University, told lawmakers bottled water poses some advantages over local tap water.

“It’s sealed, and that’s it. Nothing else happens,” he says. Tap water, on the other hand, can be subject to “great variability” as it moves from the source to treatment facilities to homes, he says.

Edberg said bottled water can be an advantage for people with compromised immune systems, including cancer patients, those taking some arthritis drugs, and patients with HIV.

Sen. Frank Lautenberg, D-N.J., introduced a bill Wednesday requiring water bottle labels to carry information about the quality and source of the water inside. “Consumers have a right to know,” he says.

Joseph Doss, who heads the International Bottled Water Association, says his industry is stepping up efforts to encourage plastics recycling and to make bottle production more fuel efficient. Water bottles account for 0.3% of all solid waste produced in the U.S., according to the industry.

“Any actions that would discourage consumers from drinking this safe, healthy beverage are not in the public interest,” he says.

Americans spend about $11 billion per year on bottled water, according to the Beverage Marketing Corp. In the process they help generate 2.7 million tons of plastic bottles. Those bottles are produced and transported using petroleum, and most wind up in landfills, Wu says.

Doss says bottled water is already closely regulated as a food product by the FDA.

“I guess it comes down to choice, and consumers have a choice,” he says.


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