Prescription Costs Rise Faster Than Healthcare Costs

Bob Moos
Bob Moos

You only have to look at the latest receipt from your pharmacist to know that prescription drug costs are rising.

Nationwide, spending on medications grew 13 percent in 2014, far outstripping the 5 percent overall increase for health care spending. Prescription drug costs haven't gone up that fast since 2001.

Sometimes, the increase was due to a breakthrough medicine whose cure comes at a high price. Other times, it was the result of an overnight tripling of the cost of a generic drug that has been around for years.

Millions of Americans depend on prescription medications to manage chronic illnesses or treat acute conditions. But surveys suggest that as many as 25 percent of us don't fill a prescription because we can't afford it.

As people stop filling their scripts, they not only jeopardize their health, they also run the risk of costing themselves and the health care system even more when they fall sick from conditions that could have been prevented.

Naturally, rising drug costs have prompted consumers to ask questions.

What medications in particular are driving up prices? Are brand-name or generic drug costs growing faster? And, most important, what can be done to make needed medications affordable?

The U.S. Centers for Medicare and Medicaid Services, the federal agency that oversees the Medicare and Medicaid programs, has a vested interest in encouraging this public discussion. It spent $140 billion on drugs for seniors, the poor, children and people with disabilities in 2014.

The agency recently created an online database -- at www.cms.gov -- that allows anyone to dive into Medicare's prescription drug data and examine some of the clearest examples of the increased costs.

After you arrive at www.cms.gov, type "Medicare drug spending dashboard" in the search field.

The new database lists 80 medications that were chosen because they triggered the highest overall spending or the greatest per-patient expenditures or the largest percentage price increases.

For each drug listed, you'll see the total amount that Medicare and its beneficiaries spent on it in 2014, recent trends in its price and the number of older Americans who depend on it.

Here are a few of the findings:

The hepatitis C drug Sovaldi accounted for the highest expenditure at $3.1 billion. Used by about 33,000 Medicare beneficiaries, it had a $1,000-per-pill price when it entered the market in 2014.

Remodulin, which treats high blood pressure in the lungs, had the largest per-user spending at $133,845. A total of 1,235 beneficiaries used the drug, whose cost amounted to $165.3 million.

The pain reliever Vimovo had the biggest increase in its per-unit cost between 2013 and 2014, rising 543 percent after one company purchased rights to the drug from another.

By putting such data in the hands of consumers, providers and researchers, Medicare hopes the public will gain a better understanding of what's going on with prescription drug costs. A similar database for Medicaid's drug spending will be unveiled later this year.

The Medicare database comes on the heels of a recent forum in Washington that brought together consumer advocates, pharmaceutical company executives, insurance industry representatives and government officials to discuss how we can continue to encourage drug discoveries and still ensure that those new medicines are accessible.

Developing ground-breaking drugs requires significant investment, and there's no disputing that this nation needs to support that important work. Without such innovation, we won't have the drugs that will better manage diabetes and heart disease and maybe even cure cancer.

But, as CMS' leaders have said, we shouldn't accept the notion that we as a society must choose between innovation and affordability. We deserve both.

Shedding new light on drug spending may help offer some clues in our search for an effective strategy that makes sure as many people as possible can benefit from today's, and tomorrow's, wonder drugs.

BY BOB MOOS, SOUTHWEST PUBLIC AFFAIRS OFFICER FOR THE U.S. CENTERS FOR MEDICARE & MEDICAID SERVICES.

Editorial on 02/03/2016