WHEREAS:

Runaway prescription drug costs are creating a major crisis for this country's healthcare system. Spending on drugs grew faster than spending in any other personal health category during the last three years; 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:

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:

Pharmaceutical inflation in 1998 accounted for 20 percent of overall increases in the cost of healthcare and these increases have helped to make the pharmaceutical industry the most profitable industry in the world; and

WHEREAS:

The large drug manufacturers are experiencing median net profits of over 20 percent -- 4.5 times the median profits for the average Fortune 500 company; and

WHEREAS:

Employers are increasingly passing off portions of the cost increases to employees in the form of higher prescription cost sharing provisions. Many employers have also placed restrictions on the type of 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 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 last year — 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:

About 28 percent of Medicare beneficiaries receive some drug coverage through employer-sponsored retiree plans, but these benefits are subject to ever-increasing copayments and more than 25 percent of large employers completely eliminated their retiree coverage over the last five years; 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 copays, and place caps on coverage; and

WHEREAS:

Medicare HMOs were once thought to be a possible solution to prescription coverage for seniors, but three-fifths of these plans now cap drug benefits at under $1,000 a year and one third of those at under $500.

THEREFORE BE IT RESOLVED:

That AFSCME continue to fight to make prescription drugs available and affordable to all citizens and to advocate for federal or state legislation to control escalating costs, including limits on direct-to-consumer advertising and financial disclosure requirements by the pharmaceutical industry; and

BE IT FURTHER RESOLVED:

That AFSCME 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

BE IT FURTHER RESOLVED:

That AFSCME give heavy weight to a candidate's position on prescription drug price limits in its endorsement procedures; and

BE IT FURTHER RESOLVED:

That AFSCME is directed to lobby Congress to ensure affordable access to prescription drug therapy, to provide the motivation for pharmaceutical companies to provide possible treatments for so called "orphan disease," and to direct the Food and Drug Administration to make new prescription drugs available in a timely and safe manner; and

BE IT FINALLY RESOLVED:

That AFSCME strongly support efforts by the White House and Congress to establish an optional prescription drug benefit under Medicare - one that will be comprehensive, affordable, and available to every Medicare beneficiary who needs it, regardless of income or health status.

SUBMITTED BY:

Danny Donohue, President and Delegate 
Barbara Reeves, Secretary and Delegate 
CSEA/ASCME Local 1000
New York

Ronald C. Alexander, President and Delegate
Vanessa Tolliver, Secretary/Treasurer and Delegate 
OCSEA/AFSCME Local 11
Ohio

Raymond Markey, President and Delegate
AFSCME Local 1930, Council 37 
New York

Allen Whitehead, President and Delegate 
Cathy Weldon, Secretary and Delegate 
AFSCME Local 443, Council 28
Washington