from: revolution may-june. 2001
the nursing shortage and the drug connection
by don demoro
director of the institute for health and socio-economic policy.
business gurus tout the recent wave of large pharmaceutical industry mergers and acquisitions as a way to lower drug costs. with competing companies merging their r&d efforts, drug companies will enjoy "economies of scale," which, according to experts, should maximize their ability to develop new drugs and bring them to market. administrative expenses, once performed in each company, would be combined into one and further reduce expenses. so consumers would get more and better prescription drugs at lower prices.
that's the business theory. in practice, just the opposite is happening.
pharmaceutical industry mergers appear to be a primary cause of the explosive rise in prescription drug costs and may be a key factor in influencing hospitals to reduce hospital nurse staffing levels.
that's the findings of a study just completed by the institute for health and socio-economic policy (ihsp). through the study, conducted at the request of rep. dennis j. kucinich (d-ohio), the ihsp was able to document for the first time a correlation among patient access, corporate market share activities, and health caregiver staffing ratios.
at the heart of the 125-page study is an analysis of the staggering economic and social effects of the pharmaceutical industry merger and acquisition binge of recent years - augmented by a survey of hospital executives who describe their response to prescription drug price hikes.
the findings should send a sobering message to policy makers:
hospitals expect to lay off nurses in the midst of a national hospital nursing shortage and medicare patients may have even less access to needed prescription drugs. meanwhile, the pharmaceutical industry becomes dominated by a handful of corporate giants who are making record profits.
the study also uncovered another trend: escalating drug prices - not reductions in medicare reimbursement rates, as many contend - may be the primary culprit in lower revenues and profits for many hospitals and managed care plans
. hospitals have responded by cost-cutting, in the form of staffing cuts and service reductions.
while all health care consumers feel the pinch of staffing cuts, seniors bear the brunt of rising drug prices. as the biggest consumer of prescription drugs, seniors with employer-provided retiree health plans face cost-shifting by their former employers. those without coverage have it even worse, as they have no stepladder to reach the drug costs that climb out of reach.
great story (too long to post, a must read!) at: