In 2019, retail prescription medicine prices declined by 0.4%, on average, according to National Health Expenditures (NHE) data from the Centers for Medicare & Medicaid Services (CMS) published recently in Health Affairs. While retail prescription medicine spending grew 5.7% that same year, this increase was due to more patients getting the medicines they need, not higher prices.
Other key findings include:
- In 7 of the last 10 years, retail medicine spending grew more slowly than total health care spending and spending on retail medicines accounted for less than 10% of total health care spending growth over the past decade.
- Since 2000, retail medicine spending has grown, on average, 3.9% per year, below the average annual growth rate of spending on hospital care (4.5%) and total health care spending (4.3%).
- Hospital spending increased 6.2% in 2019 reaching $1.2 trillion and continuing to account for nearly one third of total health care spending.
While much of the talk about health care costs in the United States focus on prescription medicine spending, this overlooks the bigger picture of what’s driving health care spending growth. To address health care spending and affordability, we should focus on policies that lower patient out-of-pocket costs for medicines, address the true drivers of health care spending and ensure health coverage works when patients need it.
Learn more at www.LetsTalkAboutCost.org.
Katie Koziara Katie is a director of public affairs at PhRMA focusing on the cost and value of medicines. She previously ran the social media strategy for a D.C.-based non-profit working on federal management and leadership issues. Outside the office, Katie can be found running on the mall, brunching with friends and cheering on the Michigan Wolverines.
Topics: Let's Talk About Cost