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Strengthening Medicare: A Framework to Modernize and Improve Medicare

Highlights of the New HHS Report, Securing the Benefits of Innovation for America's Seniors, Released Today by HHS Secretary Tommy Thompson

  • The HHS report includes a detailed review of recent breakthroughs in drug treatments for the following diseases: cancer, osteoporosis and hip fractures, asthma, arthritis, high cholesterol, heart disease, stroke, enlarged prostate, depression, Alzheimer's disease, diabetes, and migraines.
  • For all of these diseases, the HHS report presents evidence on significant improvements in the health of older Americans that have occurred because of the drug breakthroughs - enabling millions of seniors to live longer and more enjoyable and productive lives.
  • For all of these diseases, the HHS report describes new drugs in the pipeline of research and development that can provide even greater improvements in health.
  • But the HHS report also shows that access to these new treatments is not guaranteed: for all of these diseases, countries with government-run prescription drug coverage programs have limited costs by restricting access to new drugs.
    • Coverage of new drugs is delayed while government-appointed committees make decisions about which patients, if any, should have access to the drugs.
    • Coverage of new drugs is restricted to selected patients that meet criteria imposed by the government drug plan.
    • Coverage of new drugs is denied if new drugs don't make the government formulary, or covered drug list.
    • And patients who could benefit from the new drugs cannot choose to get coverage from another plan that would better meet their needs.

  • In contrast, new breakthrough drugs are generally covered quickly by private insurance plans in the United States. As a result, Americans have far greater availability and use of life-saving and life-improving new drugs.
    • U.S.-produced drugs account for the largest share of drug innovation worldwide: In 1999, drugs developed and produced by American companies accounted for more than 80 percent of global sales of the world's top 15 drugs.
    • In the late 1990s, U.S. drugs accounted for almost 70 percent of the worldwide sales of new drugs.
    • A recent report for the European Commission noted that Europe is falling behind in drug research and development, and concluded that governments should "converge on a higher reliance on innovative management methods and on competitive mechanisms, moving away from schemes excessively based on administrative decisions and bureaucratic structures/rules in the regulation in the market."
    • With all of the new breakthrough drugs in the pipeline, now is not the time for Medicare to create a drug benefit that would limit the development and availability of new drugs in the United States.
  • For the complete HHS report, go to

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