WHEREAS:

Prescription drug costs increased an average of 17 percent in 2001 and are projected to increase by 14 to 19 percent in 2002. Prescription drug costs are the fastest growing component of health cost increases and already account for 12 to 15 percent of the average health plan's expenditures; and

WHEREAS:

In 2001, the pharmaceutical industry was, again, the most profitable U.S. industry. In a year which saw dismal financial performance in most industries, the pharmaceutical industry remained on top; and

WHEREAS:

Drug manufacturers sell the exact same pharmaceuticals to different purchasers at widely varying prices. The uninsured pay the most for prescription drugs. Workers with insurance and state Medicaid programs pay less. The federal government pays the least, 20 to 40 percent less than the uninsured. Drug companies make a generous profit on all of these transactions, even on the low prices they charge the federal government. The price they charge various purchasers are confidential, so that purchasers cannot evaluate the price they are offered; and

WHEREAS:

Senior citizens account for 34 percent of all prescriptions dispensed, yet Medicare does not provide an outpatient drug benefit; employer plans cover less than 30 percent of retired workers; and most retirees in employer plans have experienced significant cost-shifting in recent years; and

WHEREAS:

Several states have enacted laws that encourage drug companies to offer deep discounts on drugs purchased under the Medicaid program so that their products are given preferred status.

THEREFORE BE IT RESOLVED:

That AFSCME encourages affiliates to participate in efforts to educate members on the cost effective use of health benefits, including but not limited to the appropriate and inappropriate use of generic, formulary or non-formulary drugs; and

BE IT FURTHER RESOLVED:

That AFSCME reaffirm its commitment to Congressional passage of a prescription drug benefit in Medicare - a benefit that features eligibility for all Medicare beneficiaries on a voluntary basis; affordability for all; comprehensive coverage of the drugs seniors use; a subsidy to help employers who provide coverage to their retirees that underwrites rising drug costs; and a maintenance-of-effort provision that will require employers to continue their retiree drug plans into the future; and

BE IT FURTHER RESOLVED:

That AFSCME work to enact price controls on prescriptions drugs at the federal level, to restrict advertising of drugs and to enact legislation to ensure transparency in drug pricing; and

BE IT FURTHER RESOLVED:

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

BE IT FINALLY RESOLVED:

That AFSCME and its affiliates undertake a national campaign to promote legislation authorizing states to negotiate deep discounts on prescription drugs for Medicaid recipients, public employees and retirees, and the uninsured.

SUBMITTED BY:

INTERNATIONAL EXECUTIVE BOARD

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

Raymond Markey, President And Delegate
Carol Thomas, Treasurer And Delegate
AFSCME Local 1930, Council 37
New York

Dale Pettit, President And Delegate
Delbert Jensen, Secretary
AFSCME Local 443, Council 28
Washington