The largest share of participants in TSCL’s 2018 Senior Survey, 43%, say that medical expenses were their fastest rising cost in 2017. Just medications alone take about 12.6% of the budgets of Americans age 65 and over, according to the Bureau of Labor Statistics. Much of this growth is being driven by the rapid rise in the cost of brand and specialty drugs.
In a particularly egregious example, the prices of 20 of the most commonly prescribed brand-name drugs increased at nearly 10 times the rate of inflation from 2012 to 2017 according to a new report from Senator Claire McCaskill (MO), who serves as the top ranking Democrat on the Senate Homeland Security and Governmental Affairs Committee. The report found that, on average, prices for these drugs increased 12% every year for the last five years. For example, Nitrostat, the nitroglycerin drug used to treat chest and heart pain, rose 477% from 2012-2017, from $15.91 to $91.76. Lantus Solostar, a long-acting insulin used to control diabetes, rose 146% from $144.15 to $354.12.
U.S. law specifically prohibits Medicare from negotiating Part D drug prices, even though Medicare does negotiate prices for drugs provided during stays in the hospital (Part A) or given at the doctors offices intravenously (Part B). This failure to protect older Americans from price gouging for prescription meds leads to extreme variation in prices of the very same drug in Part D and Medicare Advantage plans. According to a study by Advisor editor, Mary Johnson, the average cost difference between the 10 most prescribed brand drugs surveyed in September of 2017 was 749%. For example, Advair Discus, used to treat asthma and chronic obstructive pulmonary disease varied in price from $85.50 to $856.25 depending on drug plans, a difference of $770.75 for a one-month supply.
“Because Medicare is not allowed to negotiate drug prices for Part D the government, taxpayers, and beneficiaries are being taken advantage of, and spending tens of billions of dollars unnecessarily,” says TSCL’s Executive Director Shannon Benton. TSCL supports a number of bills that would not only allow Medicare to negotiate drug prices, but also would allow importation of affordable and safe drugs by wholesale distributors, pharmacies and individuals from other countries where prices are lower. To learn more, visit TSCL's website.
Source: “Drug Prices Rise As Pharma Profit Soars,” Alex Kacik, December 28, 2017.