US Senators debut bipartisan bill to encourage states to use generic drugs In Medicaid program

In an effort to increase consumer flexibility and save taxpayer dollars, US Senators Scott Brown (Republican, Massachusetts), Ron Wyden (Democrat, Oregon) and John McCain (Rep, Arizona) introduced bipartisan legislation last week that will encourage states to take advantage of cost-saving generic drugs.

The news came the same day that President Barack Obama, negotiating with Republicans and Democrats to see a way to raising the US government’s borrowing limit before the August 2 deadline, targeted Medicare and drug companies as part of the deficit talks, reported the Bloomberg news service. The Pharmaceutical, which has shed around 118,000 jobs since 2009, is already contributing $80 billion towards the cost of the US health care reform. It also came the day the IMS released a new report showing that Medicare Part D drug prices have dropped by more than a third since 2006 (see separate story today).

However, according to a recent study cited by the Senator, states waste more than $300 million a year just by not taking advantage of generic drug options. They pointed out that their Affordable Medicines Utilization Act of 2011 offers states incentives to use generic drugs by allowing states to temporarily keep a portion of the savings.