Prescription drug prices rise. Prices for prescription drugs commonly used by senior citizens increased at four times the rate of inflation in 1998, according to a report released last week by the healthcare consumers group Families USA. Prices for the 50 drugs most commonly prescribed rose 6.6% in 1998, while the general rate of inflation was 1.6%, the group said. Families USA used the report to argue in favor of a prescription drug benefit under Medicare.
High court to hear bribery case. The U.S. Supreme Court last week agreed to hear a case that will determine whether bribing a person who works for a federally funded organization is a crime simply because the organization receives that money. Federal prosecutors often use that connection to charge individuals with felonies, which typically carry greater penalties that similar violations under state laws. The case involves a Florida medical consultant convicted in 1996 of 13 counts of fraud, mail fraud, conspiracy, kickbacks and bribery. A U.S. District Court jury in Orlando agreed that the consultant paid a $10,000 bribe to a relative of the chief financial officer of two-hospital West Volusia Hospital Authority in 1993 in exchange for a $1.2 million loan from the hospital to his consulting company. Because the system receives Medicare payments, the consultant was charged with federal crimes.
GAO: Most insurers don't cover drug trials. Most health insurers don't offer blanket coverage for clinical trials of experimental drugs and therapies but do extend coverage to enrollees on a case-by-case basis, according to a report the General Accounting Office released last week. The GAO said there are no clear-cut data on the extent of insurers' coverage for clinical trials but said the approval process may discourage some enrollees from participating in trials. The report also said, however, that patients and physicians also may be submitting trial-related claims without identifying them as such. Legislation has sought to require insurers to cover clinical trials.
Bergen Brunswig fires CEO, announces loss. Bergen Brunswig Corp. said last week that it fired Donald Roden, 53, president and chief executive officer. When the company made the announcement, it also reported a fourth- quarter loss of $28.5 million, or 21 cents per share, on revenues of $4.5 billion, compared with a year-ago loss of $64.2 million, or 63 cents per share, on revenues of $3.7 billion. For the fiscal year ended Sept. 30, the Orange, Calif.-based drug distributor reported net income of $70.5 million, or 59 cents per share, on revenues of $17.2 billion, compared with last year's net income of $3.1 million, or 3 cents per share, on revenues of $13.7 billion. "Overall, we are not satisfied with our performance, which has been affected by our acquisitions, and we have taken immediate and definitive actions, which we anticipate will bring our profitability back to acceptable levels," said Robert Martini, company chairman and interim CEO. Roden had been president since 1995 and also became CEO in 1997.
New American reports quarterly loss. New American Healthcare Corp. said last week that it has recruited 24 physicians and sold two underperforming hospitals but still reported a loss of $24 million, or $1.38 per share, for the second quarter ended Sept. 30. In last year's quarter the Nashville-based company reported a profit of $481,000, or 3 cents per share. Revenues for the quarter were $44 million, up 16% from $38 million in the year-ago quarter. New American has nine acute-care hospitals in seven states.
More workers covered by employers' healthcare plans. Contrary to popular belief, employer-based health insurance benefits are not eroding, according to a study to be released this week by the Rand Corp., a Santa Monica, Calif.-based think tank. The study said 60% of all workers were enrolled in their employer-offered healthcare plans in 1997, compared with 58% in 1993.