PRESS RELEASE

For Immediate Release

Wednesday, April 10, 2002

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Citizens' Council on Health Care

1954 University Ave. W., Suite 8

St. Paul, MN 55104

CONTACT:Twila Brase, R.N., President

PHONE: 651-646-8935

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Proposed Minnesota Drug Plan May Lead to Less Access

St. Paul, Minnesota - Legislators should weigh the potential for

negative consequences before passing the prescription drug bill

approved yesterday by a Minnesota House committee, says Citizens'

Council on Health Care (CCHC). House File 2646 requires

pharmaceutical companies that sell medication in Minnesota to

subsidize prescriptions for all citizens with incomes at or under

250% of poverty guidelines. A conference committee will determine the

final provisions of the bill, but potential negative consequences

include:

* REDUCED RESEARCH/FEWER NEW MEDICATIONS: Drug companies will weigh

the cost of developing new medication against the cost of subsidizing

its distribution. Expensive drugs that could substantially improve

quality and length of life may never be developed. Development of new

genetic-based prescriptions may be limited.

* LOSS OF PRIVATE DRUG COVERAGE: Private health insurance companies

may decrease drug coverage or eventually eliminate it. State programs

may be asked to assume greater responsibility for drug costs.

* RATIONING: As state budget's rise and fall, the State may use the

rebate program to limit the types of medication available to

enrollees.

* PATIENT PRIVACY: The Department of Human Services will receive

information from pharmacies on all medications prescribed to enrolled

individuals.

* EXPANDED ENTITLEMENTS: The plan is an entitlement program that

expands citizen dependence on government welfare programs.

* DRUG COMPANY DROPOUTS: The marketplace for pharmaceutical products

is worldwide. Would a drug company choose not to sell medication in

Minnesota?

* INCREASED COSTS: Cost of subsidization will be passed on to

customers, including third-party payers, insurers, employers, and

individuals with incomes over 250% of poverty guidelines. The cost of

insurance may rise, the level of employer benefits may fall, and the

uninsured rate may increase.

"The impact of public incursion into private industry should not be

taken lightly," says Twila Brase, president of CCHC. "It's an

election year. Bad policy often comes out of feel-good politics.

Residents of Minnesota may end up with less medication options,

higher insurance costs and less privacy if this legislation becomes

law."

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CCHC is an independent non-profit free-market health care policy

organization located in St. Paul, Minnesota

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A free-market resource for designing the future of health care

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Citizens' Council on Health Care

1954 University Ave.W., Suite 8

St. Paul, MN 55104

651-646-8935 phone

651-646-0100 fax

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