Originally published December 7 2005
New York Medicaid comes under fire for overspending on pharmaceuticals
by Mike Adams, the Health Ranger, NaturalNews Editor
The New York Times examines the spending record of New York Medicaid and finds that it does not act aggressively enough to check the rising costs induced by pharmaceutical companies looking to increase their profits at the expense of the consumer.
New York spent $74 million last year, far more than any other state, on Nexium, the "new Purple Pill" for heartburn.
The drug is virtually identical to Prilosec, available at one-sixth the cost over the counter, and so at least 20 state Medicaid programs and many private health insurance companies severely restrict its use.
Only now, two years after other states began imposing limits on Nexium, has New York moved to restrict it.
And those amounts are pocket change compared with the $348 million or more that New York could have saved if it were as aggressive as a state like Michigan in setting the prices it pays pharmacies for the drugs they dispense.
Prescriptions that are severely restricted in many states are often dispensed freely here, and at higher prices, costing taxpayers hundreds of millions of dollars.
While other states have tried to fight soaring drug costs, New York lacks even the most basic controls that dozens of other states and private health insurers have used.
"They call it the gold card," said William Scheer, president of the New York City Pharmacists Society and a pharmacy owner, referring to the state health care program.
The spending is another reason the state's Medicaid program is, at $44.5 billion, by the far the largest and most generous in the country.
The costs can also be traced, in part, to years of industry lobbying in Albany.
And it may now be too late for the bill to achieve the significant savings that would have occurred a few years ago.
Beginning next year, Medicare, the federal health care program for the elderly, will pay for prescription drugs for many elderly people now on Medicaid, and Medicaid's reduced role will diminish its negotiating power with drug makers.
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