• Election for governor is Nov. 3.
• A primer on drug-buying pools and property taxes
• What Corzine and Christie say about those issues
The concept is easy to grasp: Buy in bulk, and save. Individual consumers do it all the time. So do most states, when it comes to buying prescription drugs.
The National Conference of State Legislatures(NCSL) says 44 states belong to at least one of five multistate bulk-buying pools. New Jersey is not among them.
Most of these pools include drugs for Medicaid patients, and states can save up to 5 percent, said Richard Cauchi, director of NCSL’s health program. That’s over and above the savings available to all state Medicaid agencies under federally mandated manufacturer rebates.
States can employ other strategies to save. The most common is a preferred drug list. More than 40 states require patients to use only generic or low-cost brand drugs on the preferred list. Again, New Jersey is not one of them.
Some of these bargaining chips are controversial with patient advocacy and industry groups. The Pharmaceutical Research and Manufacturers of America(PhRMA) is flatly opposed to using preferred drug lists and bulk-purchasing for Medicaid. New Jersey is home to 15 of the world’s largest pharmaceutical companies, and the influential industry employs 60,000 people.
AARP New Jersey supports a multistate buying pool and a preferred drug list. “The savings could preserve existing prescription programs and expand eligibility to more consumers,” said Douglas Johnston, AARP New Jersey senior advocacy manager.
New Jersey Medicaid spends $700 million a year on medicines. It gets $160 million back in standard rebates, and gets additional savings through generic drugs.
New Jersey has discussed a bulk-buying pool with New York and Pennsylvania. Tom Snedden, director of Pennsylvania’s drug assistance program for low-income older people, said such a pool would capture a $10 billion market and save millions but it faces political and legal hurdles.
“It was very ambitious. No state, let alone a combination of states, has ever attempted to pool their drug buy in this manner,” Snedden said.
Where the candidates for governor stand:
• Chris Christie, R, supports joining a drug-buying pool and developing a preferred drug list.
• Gov. Jon Corzine, D, supports a drug-buying pool but said New Jersey gets significant rebates and discounted pricing without a preferred drug list.
Property Tax Heartache
Property taxes, an evergreen issue in New Jersey elections, are the highest per capita in the nation and have been since 1994.
In 2008 the average residential property tax bill was $7,045. The 3.7 percent increase was relatively mild—compared with 5.4 percent in 2007 and 7 percent in 2006—but it smarted in a recession year. When Monmouth University Polling Institute asked voters to identify the top issue in the election for governor, 48 percent named property taxes.
Property taxes financed $23.2 billion of the $41.9 billion spent by local governments and schools last year. State aid filled in much of the gap. About $1.7 billion is set aside for property tax relief and the popular homestead rebate program for older or disabled homeowners.
AARP New Jersey wants the state to reduce its reliance on property taxes and reform the tax system.
Where the candidates stand:
• Christie supports property tax reform and would not eliminate rebates.
• Corzine also supports reforms. He said he expanded one tax rebate program for seniors and reformed the property tax system through a new school funding formula.
Mary Jo Patterson is a freelance reporter based in New Jersey.
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