iLoveBenefits: Industry News Blog

Drug spending growth rate declines

Between May 2015 and May 2016, the growth in spending on prescription drugs dropped to 5.2%, down from 12.2% in 2014. Source: “CSHS Health Sector Economic Indicators Briefs: July 2016 Health Sector Economic IndicatorsSM Briefs,” Altarum Institute/Center for Sustainable Health Spending, July 2016, http://altarum.org/our-work/cshs-health-sector-economic-indicators-briefs  

What is the avg. cost per prescription for specialty drugs?

 

 

2015 Cost, By Condition, Of Specialty Drugs Based On Avg. Price Per Prescription

 

  1. Hepatitis C – $17,090.18
  2. Sleep Disorders – $8,928.96
  3. Oncology – $7,158.53
  4. Cystic Fibrosis – $6,441.27
  5. Multiple Sclerosis – $4,549.22
  6. Pulmonary Hypertension – $3,892.31
  7. Inflammation – $3,035.95
  8. HIV – $1,272,01

 

Notes: Mercer 2015 national survey of employer sponsored health plans & express scripts 2015 drug trend report

 

Source: Mercer

The continuing rise in the cost of drugs

According to a recent report, in 2015:

  • The total spending on medicines in the U.S.–net of off-invoice discounts and rebates–was $309.5 billion, up 8.5% year over year
  • A total of 4.4 billion prescriptions were dispensed, up 1% year over year
  •  The average patient cost was $44 per prescription for brand prescriptions filled through a commercial plan, up more than 25% since 2010

Source: “IMS Health Study: U.S. Drug Spending Growth Reaches 8.5 Percent in 2015,” IMS Health News Release, April 14, 2016, http://www.imshealth.com/en/about-us/news/ims-health-study-us-drug-spending-growth-reaches-8.5-percent-in-2015

April 21, 2016 | Categories: Cost,drugs,healthcare | Tags: , , , | Comments (0)

Drug costs in 2015

4.4 Billion Prescription Drugs Were Dispensed in 2015

The IMS Institute for Healthcare Informatics recently conducted an analysis on medication spending trends. Here are some key findings from the report:

· Total spending on medicines in the U.S. reached $310 billion in 2015.

· 2015 saw a 8.5% total spending increase for medicines in the U.S. compared to 2014.

· Specialty medicines contributed more than two-thirds of overall growth between 2010 and 2015.

· 2015 saw a 21.5% spending increase for specialty medicines to $150.8 billion on an invoice price basis.

· The average patient cost exposure for brand prescriptions reached $44 per prescription in 2015.

· Total prescriptions dispensed in 2015 reached 4.4 billion, up 1% year over year.

Source: IMS Institute for Healthcare Informatics, April 14, 2016

Prescription Drug Prices Increased by 9.4% in 2013

AARP recently released a study on the pricing trends of 622 widely used prescription drugs. Here are some key findings from the report:

  • In 2013, the average cost of a drug was more than $11,000 per drug per year.
  • This cost is more than twice the average annual cost ($5,571) in 2006.
  • Retail prices for widely used prescription drugs increased by 9.4% in 2013.
  • The price increase was more than six times higher than the inflation rate of 1.5%.
  • Brand name and specialty drugs experienced price increases of 12.9% and 10.6%.
  • Generic drug prices decreased 4.0% in 2013.

Source: AARP, February 2016

March 8, 2016 | Categories: Cost,drugs,healthcare | Tags: , , , | Comments (0)

76% favor limiting the amount drug companies can charge for high-cost drugs

According to a recent survey:

  • 72% of Americans think prescription drug pricees are unreasonable
  • 83% approve of allowing the federal government to negotiate with drug companies for lower prices on medications for Medicare beneficiaries
  • 76% favor limiting the amount drug companies can charge for high-cost drugs for illnesses like hepatitis or cancer
  • 51% feel that regulation by the federal government would do a better job at keeping prescription drug costs down than marketplace competition
  • 40% feel that marketplace competition would do a better job at keeping prescription drug costs down than government regulation

Source: “Kaiser Health Tracking Poll: August 2015,” the Henry J. Kaiser Family Foundation, August 20, 2015, http://kff.org/health-costs/poll-finding/kaiser-health-tracking-poll-august-2015/

August 25, 2015 | Categories: Benefits,Cost,drugs,healthcare | Tags: , , , , | Comments (0)

We must all do better for patients . . . ultimately for our families and ourselves

According to a recent report:

  • Medication errors affect 3.8 million patients annually
  • In 2014, 59% of hospitals entered at least 75% of all medication orders electronically
  •  In 2013 and again in 2014, 36% of potentially harmful medication orders that were entered electronically did not trigger an appropriate warning
  • 13.9% of potentially fatal medication orders that were entered electronically were not flagged

Source: “Despite Improvement, New Report Reveals Technology to Prevent Medication Errors Fails Too Often,” The Leapfrog Group News Release, April 9, 2015, http://www.leapfroggroup.org/policy_leadership/leapfrog_news/5268377

What part of your health care budget goes to pharmacy costs?

According to a recent survey, 77% of employers spent 16% or more of their total health care budgets on pharmacy benefits in 2014, up from 71% in 2013. Source: “Majority of Employers Spend 16 Percent or More of Health Care Budget on Pharmacy Benefits: Buck Consultants Survey,” Buck Consultants at Xerox Press Release, February 25, 2015, http://news.xerox.com/news/5th-Annual-Buck-Consultants-at-Xerox-Prescription-Drug-Benefit-Survey

Most employers spend 16% or more of their healthcare budget on pharmacy benefits for their employees

Buck Consultants at Xerox recently released the fifth annual “Prescription Drug Benefit Survey”. Here’s what they found:

  • 77% of employers spend 16% or more of their healthcare budget on employee pharmacy benefits.
  • Almost 5% of employers spend more than 30% on pharmacy.
  • A specialty drug costs at least $2,500 per month or $75,000 per year.
  • 22% of respondents do not know the portion of drug spend attributed to specialty medications.
  • Utilization management programs, like prior authorization, are used by 77% of responders.

Source: Buck Consultants, February 25, 2015

U.S. Out of Pocket Expense for Prescription Drugs

According to a recent report, 18% of the $263 billion spent on retail prescription drugs in the United States in 2012 was paid out of pocket. Source: “Strategies Used by Adults to Reduce Their Prescription Drug Costs: United States, 2013,” Centers for Disease Control and Prevention, NCHS Data Brief Number 184, January 2015, http://www.cdc.gov/nchs/data/databriefs/db184.htm

As high and higher deductible plans take hold, the percentage paid for Rx drugs should rise.

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