AARP is singling out the 25 most costly drugs under Medicare Part D plans as the government prepares to being negotiating prices with drug companies.
This year, under the Inflation Reduction Act, Medicare will begin negotiating prescription drug costs by penalizing companies that increase prices faster than the general inflation rate.AARP’s analysis is intended to show where drug negotiations can have the biggest effects and how crucial they might be for lowering costs to patients and taxpayers.Prescription drug prices exceed inflation
All but one of the top 25 drugs’ annual price increases significantly outpaced general inflation rates, according to the AARP study. For example, general inflation increased by 71% in the same period that Lantus’ price increased by 739%.The longer these drugs were on the market, the more drastically their prices rose.
“In real terms, this could be the difference of thousands of dollars for one person, enough to force the trade-offs that we often hear about like being able to put food on the table or being able to pay for gas.”AdvertisementPeople who use Medicare prescription drug plans take an average of four to five prescription drugs a month, Purvis said. Increasingly, patients’ drug costs are covered by co-insurance plans, in which the patient pays a percentage of a drug’s price instead of a copay.
This means that what patients pay out of pocket for drugs is directly affected by drug companies’ pricing decisions, accounting for new drug prices as well as price increases. According to the study, the median price of new brand-name drugs is about $200,000. Even a small percentage increase for drugs that start at that price could mean thousands more dollars for patients.“Across the country, more and more people are facing cost-sharing that’s directly affected by drug pricing increases whether it’s through co-insurance or simply before they’ve met their deductible,” Purvis said.
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