SHAHEEN INTRODUCES TWO HEALTH CARE COST SAVINGS MEASURES

Bills would reduce overuse of emergency rooms, close a loophole used by brand name drug companies to delay market introduction of affordable generic drugs

October 14, 2009

(Washington, D.C.)U.S. Senator Jeanne Shaheen today introduced two bills to help control health care costs and provide patients with better care and access to affordable prescription drugs. The Reducing Emergency Department Utilization through Coordination and Empowerment, or REDUCE Act, would reduce costly and excessive emergency room visits by providing patients with more consistent and better coordinated care.  Shaheen's second bill, the bipartisan Access to Affordable Medicines Act, would close a loophole some brand name drug companies exploit that needlessly and unfairly delays the entry of safe, lower-cost generic drugs to the consumer market.

"A key component of reforming the health care system is fixing what doesn't work," said Shaheen.  "Treating people repeatedly in emergency rooms instead of coordinating less costly preventive care, and allowing brand name drug companies to purposefully delay consumer access to more affordable generic drugs are perfect examples of what is wrong with our nation's health care system.  These bills offer commonsense solutions to costly problems that need to be addressed in order to achieve comprehensive health care reform."

It is estimated that we spend $14 billion each year on unnecessary emergency room visits. Frequent users of emergency room services make up a small but very costly portion of the population.  These individuals tend to have increased health care needs - they often have multiple chronic conditions and severe mental illness. They also often live in poverty or are homeless.

The REDUCE Act is modeled after successful pilot programs across the country which provided frequent users of emergency services with a coordinated care management team that helps to ensure these patients see their primary care doctors and mental health providers on a regular basis, thus keeping them out of the emergency room.  In one of these pilot programs, emergency room use was reduced on average by 61 percent.

The REDUCE Act is co-sponsored by Senators Sherrod Brown (D-OH) and Robert Menendez (D-NJ), and has been endorsed by the American Academy of Family Physicians, National Alliance to End Homelessness, Corporation for Supportive Housing, and American Osteopathic Association.

The bipartisan Access to Affordable Medicines Act would close a loophole used by brand name drug companies to delay generic drugs from entering the market.   As the law currently stands, when brand name manufacturers make labeling changes, generic drug labeling must reflect this change prior to approval and introduction to the market. This law was created with consumer safety in mind, so that all current drug safety and warning information would be reflected on the label.  However, many brand name drug companies make last minute changes to labels not because of safety concerns, but instead to delay the introduction of cost-saving generic drugs by weeks or months to maintain market exclusivity.

The Access to Affordable Medicines Act would stop these costly practices by providing a 60-day grace period for the generic drug company to submit the new labeling for approval and marketplace distribution. The bill includes safeguards so that in the event the new labeling truly presents a safety issue, the FDA would prohibit the medication from entering the market until the generic manufacturer updated the labeling.

The Access to Affordable Medicines Act is co-sponsored by Senator David Vitter (R-LA) and is endorsed by the AARP, Generic Pharmaceutical Association and Consumer's Union.

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