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Prescription Drugs and Medicare Reform

William D. Novelli
AARP Executive Director and CEO
American Medical Association
2003 National Advocacy Conference
Washington, DC

Good afternoon. It's a pleasure to be here. You have had quite a line up of speakers already today with more to follow, and I'm certainly proud to be part of it. I especially want to thank Dr. Mike Maves for inviting me to speak to you on behalf of AARP's 35 million+ members.

You and your colleagues-physicians, researchers, medical scientists, public health experts-are largely responsible for the enormous progress we have made in helping people to live longer and to live better in 21st century America.

But as you know, despite all of this progress, we still face serious challenges regarding health and health care.

Last spring, AARP released a study titled, "Beyond Fifty: A Report to the Nation on Trends in Health Security," which identified the primary factors that influence the health security of 50+ Americans:

  1. Increased reliance on prescription drugs and other new health technologies has brought about major changes in the delivery of health care and has driven health-care costs and coverage structures.
  2. Chronic diseases and conditions are common among people over age 50, especially in the oldest age segments. But the systems that serve the chronically ill remain oriented largely toward acute medical care. Increasingly, the health-care needs of this population involve a range of services across the spectrum of physician, inpatient, outpatient, and long-term care.
  3. Greater longevity-and the functional limitations that accompany old age-have highlighted the need to live more independently and increased awareness of the quality of life, especially during the last stages of life.
  4. There is increasing recognition among those who provide or pay for care that patients need choices about quality and value. Informed decision-making is an increasingly important-yet often missing-dimension in consumer thinking about health security. (For those needing long-term care, especially, the challenge of navigating a fragmented, uncoordinated, patchwork of public and private programs is very, very difficult.)
  5. High and rising health-care costs make care less accessible for many 50+ Americans. Average spending per person over age 50 has increased, fueled largely by the increase in chronic conditions and spending for prescription drugs. Out-of-pocket spending on prescription drugs and long-term care represent the greatest health-related financial risk for older Americans.

I'm not going to talk about all of these today, but they do provide a good context for the issue I do want to focus on-- prescription-drug coverage in Medicare and Medicare reform.

We face a major problem in this country today: older Americans and their families cannot afford or sustain current prescription drug costs. We truly need these products, but we also need them to be affordable. The marketplace is out of balance, and spending on these wonderful drugs that combat disease and ease suffering is too high.

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