News Release

Uninsured Consumers Pay Too High A Price For Prescription Drugs In Texas

For Immediate Release

(Austin, Texas) -- Uninsured consumers in Texas are charged much higher prices for prescription drugs than the best available market prices, according to a survey released today by TexPIRG. The group criticized proposed Congressional reforms, urging the Texas legislature to instead form prescription drug buying pools.

"When the 41 million uninsured Americans go it alone at the drug store, they pay the price—sometimes more than double what government agencies pay to buy the same drugs in bulk for large groups of consumers," said Luke Metzger, advocate at TexPIRG.

"HMOs and the federal government use their buying power to negotiate fairer prices for the drugs they purchase," continued Metzger. "Unfortunately, uninsured consumers have no one doing the same on their behalf so drug companies are making money hand over fist, profiting the most from chronically-ill Americans without prescription drug coverage."

Using a list of 10 frequently prescribed medications, TexPIRG joined state PIRGs across the country to survey more than 500 pharmacies in 19 states and determine how much more uninsured consumers pay for these medications than one of the pharmaceutical industry's "most favored" customers, the federal government.

On average, the report found, uninsured consumers in Texas have to pay 69 percent more for the 10 common prescription medications than the federal government. The price differences ranged from 30 percent for Lanoxin to 107 percent for K-Dur 20. 

In June, both the House and Senate passed versions of the Bush administration's Medicare reform bill that would establish a prescription drug benefit for Medicare recipients. The bills require recipients to join regional private health insurance plans to obtain the new drug benefit.

"These bills fail to address the skyrocketing cost of prescription drugs and do nothing to help the millions of Americans without prescription drug coverage who do not qualify for Medicare," said Metzger.

TexPIRG called for policy reforms to close the loopholes that allow companies to block lower-priced generic versions of their drugs from reaching the marketplace. TexPIRG also urged the Texas legislature to create prescription drug-buying pools that would allow businesses, the government and individuals of all ages to use their combined buying power to negotiate lower drug prices. In the 78th Legislature, state Rep. Richard Raymond and Rep. Solis introduced HB 1545 to create such a program, . The bill was estimated to save the budget Texas $145,949,790 over two years. Unfortunately, the bill never got out of committee. A similar bill sponsored by Senators Ellis and Deuell was also filed, but did not move, in the 78th legislature.

"Prescription drug buying pools are simply good medicine for runaway health care costs," concluded Metzger.

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