Provisions of HR 1424 could reduce access to necessary medications for
thousands of Americans
INDIANAPOLIS, March 5 /PRNewswire-FirstCall/ -- Today Eli Lilly and
Company (NYSE: LLY) reiterated its strong support for mental health parity
-- the principle that insurers should treat mental and physical illnesses
equally. But the company also expressed strong concerns over the way the
parity legislation in the U.S. House (HR 1424) seeks to pay for the bill:
by increasing the so-called Medicaid rebate from 15.1 percent to 20.1
percent. Such an increase would limit Medicaid beneficiaries' access to
medicines, including mental health medications, said Lilly. The company
said its position is supported by a leading mental health advocacy group
and Congressional Budget Office data.
"HR 1424 would offer more generous mental health benefits to Americans,
but it risks doing so on the backs of the sickest and poorest Americans,
including vulnerable Medicaid patients," said Sonya D. Sotak, director,
federal affairs, for Lilly. "At first blush, increasing the Medicaid rebate
appears an alluring target for the federal government to pay for parity,
but the harsh irony is that such an action could lead to even greater
disparities in Medicaid patients' future access to medications."
In a letter last week to House leaders, a leading mental health
advocacy group, the National Council for Community Behavioral Healthcare,
echoed these concerns. "I fear that increasing the pharmaceutical rebate in
Medicaid could have the unintended consequence of reducing access to
necessary medications for thousands of Americans. I urge you to find
another way to pay for the provisions of HR 1424," wrote NCCBH President
and CEO Linda Rosenberg, MSW.
The Medicaid rebate, created in 1990, is the federal program that
requires pharmaceutical companies to discount -- or "rebate" -- a portion
of their revenues from sales to Medicaid patients. A CBO report on the
program has said, "Although the Medicaid rebate appears on the surface to
be attractive, it may have had unintended consequences for private
purchasers." That is, whatever money Medicaid saves likely leads to cost
increases for all other consumers -- a total that is believed to top $2.5
billion dollars a year.
Lilly also said the Medicaid rebate comes at a great cost to U.S. based
pharmaceutical companies -- as many of these companies, like Lilly, have
developed medications that predominately serve the Medicaid population,
including people with serious mental illness.
"The Medicaid rebate is a price control, which time and again has been
shown to harm innovation, the U.S. economy, and ultimately public health,"
Sotak said. "We urge the Congress to listen to the mental health advocacy
community, review the data, and reject any further increases in the
Medicaid rebate."
Under the basic rebate formula, makers of brand-name pharmaceuticals
rebate to the states at least 15.1 percent of the average manufacturer
price that Medicaid beneficiaries purchase as outpatients -- a percentage
that does not reflect the other discounts Medicaid gets, such as the fact
that Medicaid already demands that it gets the "best price" when compared
to all other purchasers in the United States.
About Lilly
Lilly, a leading innovation-driven corporation, is developing a growing
portfolio of first-in-class and best-in-class pharmaceutical products by
applying the latest research from its own worldwide laboratories and from
collaborations with eminent scientific organizations. Headquartered in
Indianapolis, Ind., Lilly provides answers -- through medicines and
information -- for some of the world's most urgent medical needs.
Additional information about Lilly is available at http://www.lilly.com.
C-LLY
(LOGO: http://www.newscom.com/cgi-bin/prnh/20031219/LLYLOGO )
SOURCE Eli Lilly and Company
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Related links:
http://www.lilly.com
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NewsCom: http://www.newscom.com/cgi-bin/prnh/20031219/LLYLOGO
PRN Photo Desk, photodesk@prnewswire.com
CONTACT:
Edward Sagebiel of Eli Lilly and Company,
+1-317-433-9899
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