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June 28, 2004 - Subscribe - Contact Us - Rate Card - Place an Ad Valley&State Backpage O&E Sports Archives Classifieds Faith&Beliefs Obituaries Revels May 11, 2004 Drug advertising is driving prices up By Vickie Aldous Ashland Daily Tidings It's impossible to watch the evening news these days without being bombarded with commercials for prescription drugs to treat heartburn, arthritis, high cholesterol, erectile dysfunction, nail fungus and a host of other ailments. Many health care industry experts blame those direct-to-consumer advertisements for contributing to the rise in insurance premiums. "It's rare if I talk to anybody who doesn't know what the purple pill is," said David Clark, vice president of pharmacy services for RegenceRx, a non-profit affiliate of Regence BlueCross BlueShield of Oregon that helps consumers manage drug costs. But Nexium, the "purple pill" for heartburn, costs $130 per month, compared to $22 a month for Prilosec OTC, which is available over the counter, he said Regence BlueCross BlueShield of Oregon recently began covering Prilosec OTC - the first time it has offered a benefit for an over-the-counter drug - in an effort to reduce spending on heartburn medications knows as proton pump inhibitors. The insurance company spends more on those drugs than any other type of medication, according to Clark. Whether advertising is entirely to blame, total sales of prescription drugs in Oregon jumped 14.4 percent from 2001 to 2002, and increased 12.2 percent nationwide, according to data from the Kaiser Family Foundation. Clark said the development of new drugs and increased advertising isn't a purely negative development. "People are becoming more aware that what they have may be treatable. That's a good thing if they have a chronic condition or it could lead to death. It does lead to a better or longer life or fewer hospitalizations," he said. "But with direct-to-consumer advertising, it's not always appropriate utilization. Clearly, there are good cases where a patient had the right treatment. But other patients are asking for medications they don't need." Drug companies are seeing returns from their $3 billion to $4 billion annual advertising spree. Every dollar spent on advertising generates four dollars in drug sales, according to Clark. Drug companies spend slightly less on research and development than on advertising, according to Clark and other health industry experts. A decade ago, drug companies spent $300,000 annually on consumer advertising. The Food and Drug Administration then loosened rules on advertising, but the federal agency now is reviewing whether the rules are too lenient, Clark said. Many people resort to drugs to treat such conditions as high cholesterol or erectile dysfunction, when for some patients, modifying their exercise and diet habits would be just as effective, he said. Physical inactivity significantly increases the risk of developing conditions such as obesity, heart disease, stroke, colon cancer, diabetes, arthritis and osteoporosis. Health care costs related to those conditions total more than $600 billion annually in the United States, according to Regence BlueCross BlueShield of Oregon. Many industry experts said consumers are shielded from the true cost of health care by their insurance, giving them little motivation to adopt a healthy lifestyle or make selective decisions about treatment and drug usage. "Be alert. Be educated. When you make choices about health care, understand what it costs. People with a good group plan take it for granted. They don't pay attention to their own bills because they are not paying them," said Wyn Lewis, a licensed insurance agent for Western States Insurance Agency in Ashland who helps individuals and businesses find insurance plans. To make employees more aware of costs, some employers are adopting plans with higher deductibles and physician office visit and drug co-pays, as well as tiered prescription drug plans where employees pay less for generic versions and more for brand-name drugs. Companies that applied "financial tension" to employees to make them more careful about health care usage saw median premium cost increases of 7 percent - about half the increase faced by the average business, according to a study released this year by the National Business Group on Health. Other experts said improvements in technology are driving health care costs, and therefore insurance premiums, higher and higher. Technological improvements account for more than half the increase in total health care spending since 2000, according to Andrew Tilton, an economist with the investment banking firm Goldman Sachs. Tilton also cites rising profit margins on health care insurance as a factor. Many physicians, meanwhile, point to rapidly escalating malpractice insurance rates. In Oregon, they are advocating a $500,000 cap on non-economic, or "pain and suffering," awards in malpractice cases. DailyTidings.com Home Page Valley&State | Backpage | O&E | Sports | Archives | Weather | Classifieds Columnists | Faith&Beliefs | Obituaries | Revels | Subscribe | Contact Us Copyright 2004 Ashland Daily Tidings and Ottaway Newspapers All Rights Reserved Click Here Site Search: .:Advertisements:. RESOURCES - Mail Tribune News - ODOT Road Cams