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Kids health bill contains pro-consumer measures

Friday, July 27, 2007

Children’s Health Insurance Bill Includes Pro-Consumer Measures on Prescription Drugs, Hospital Errors

Healthcare effectiveness, Part D out-of-pocket cost protections addressed in bill

(Washington, DC) – The children’s health insurance bill approved by a House committee is not only vital for the future of the nation’s children, but also includes important provisions Consumers Union has been fighting for to help all consumers access the most cost-effective prescription drugs and treatments.
The bill also should help spur hospitals to take measures to stop the spread of deadly hospital-acquired infections by restricting Medicare payments to hospitals for healthcare costs from preventable errors like infections, a major threat that kills nearly 100,000 people each year.
“This is an essential health reform bill that will make enormous improvements in the health of consumers for years to come,” said Bill Vaughan, senior policy analyst for Consumers Union, publisher of Consumer Reports. “Not only will our children benefit, but medical consumers of all ages will see benefits in safer, more effective and more affordable healthcare.”
The Children’s Health and Medicare Protection Act of 2007, reported out early Friday by the Ways and Means committee, will provide effective healthcare coverage for most of the 6 million lower-income children who are generally eligible for, but not currently enrolled in, Medicaid or SCHIP.
The measure also includes significant funding – $375 million by the year 2011 – for comparing the effectiveness of prescription drugs, medical devices and treatments, and making those results known to consumers. Funding for the comparative effectiveness program would come from Medicare and a user-fee paid by insurance companies.
“The only hope this nation has of stopping runaway healthcare costs is to stop paying for health services that don’t work or are ineffective, and concentrate on the most effective services,” Vaughan said. “It takes in-depth research to separate the good treatments from the average, and at long last this bill provides the money we need to do that research.”
To encourage medical providers to take steps to eliminate preventable medical errors that seriously harm patients, the bill also calls for a plan by 2010 to reduce or eliminate Medicare payments to hospitals for treatment of patients who suffer preventable safety errors such as hospital-acquired infections.
Medicare has taken some small steps toward cutting payments for hospital-acquired infections that kill nearly 100,000 Americans a year and cost the healthcare system as much as $27 billion in higher expenses, but the bill calls for doing more, Vaughan said.
”Consumers Union will work to ensure that hospital-acquired infections are included on the list of ‘never events’ as defined in this bill, because typically they are not. This could ultimately help save untold lives and dollars in the years to come,” Vaughan said.
The measure also stops Medicare’s practice of randomly assigning low-income beneficiaries to expensive Part D prescription drug plans that waste millions in taxpayer dollars and don’t provide coverage to the most needed drugs. The Congressional Budget Office said this provision could save Medicare and taxpayers $1.2 billion over 10 years.
“With common-sense assignment of low-income folks to inexpensive, comprehensive drug plans, taxpayers, Medicare and its most vulnerable beneficiaries will benefit,” Vaughan said.
The bill calls for assigning beneficiaries who don’t pick a plan to one that covers the most commonly prescribed drugs and those deemed sensitive by CMS (such as HIV and mental health); has an above average pharmacy network; scores high in CMS quality indicators; and is among the lowest-cost plans offering the package of commonly prescribed drugs.
A sampling of eight zip codes this week by Consumers Union found that about one-fourth of drug plans eligible to be automatically assigned to low-income beneficiaries failed to cover a package of six commonly used drugs by seniors. Also, the sample found that each zip code’s most expensive random enrollment plan required a co-pay of more than $2,800 a year – a daunting amount for a low-income senior or person with disabilities.
Costs also varied in the sample. On average, there was a $346 difference between the most expensive and least expensive annual cost for the package of six commonly used drugs among the random-assignment plans. (Actonel for osteoporosis, Aricept for mild dementia, Celebrex for arthritis, furosesmide for hypertension, Lexapro for depression, and Lipitor for high cholesterol).
Contact: Bill Vaughan, 202-462-6262