Spending on Prescription Drugs Has Been Growing Exponentially over the Past Few Decades

Prescription drugs play a vital role in the U.S. healthcare system, enabling Americans to live longer, higher-quality lives. However, the growing cost of those drugs presents a significant challenge to the quality and affordability of healthcare in the United States.

U.S. spending on prescription drugs has risen substantially in the past 20 years, climbing from about $88 billion in 1998 to $335 billion in 2018. Furthermore, the Centers for Medicare and Medicaid Services project that such spending will continue to grow, rising to $560 billion by 2028 — an increase of 67 percent.

That rise in spending can be attributed to many factors, including the number and type of drugs prescribed. Some common reasons include:

  • High and rising prices for brand-name drugs
  • A lack of competition due to the U.S patent system
  • The use and cost of specialty drugs
  • A lack of transparency in drug prices

While prescription drugs can help improve health outcomes in the United States, the rising cost of those drugs can place a financial strain on American families and the country’s fiscal health. The coronavirus pandemic, and its effect on individual income and the country’s economic outlook, could exacerbate this challenge. Moving forward, containing prescription drug costs will be a vital issue as our country recovers from the pandemic and turns its attention towards addressing the long-term fiscal challenge.

Spending on Prescription Drugs Has Been Growing Exponentially over the Past Few Decades

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Tweet: Spending on prescription drugs has been growing exponentially over the past few decades. https://ctt.ec/bqy8d+ via @pgpfoundation


Tweet: Prescription drug costs have grown significantly over the past several decades — and that trend is projected to continue. https://ctt.ec/w17Vd+ via @pgpfoundation


Tweet: Prices for prescription drugs have been increasing substantially over time. https://ctt.ec/M7fO9+ via @pgpfoundation


Tweet: High and rising prices for brand-name drugs is one of the biggest drivers of growing prescription drug spending. https://ctt.ec/gMN1t+ via @pgpfoundation


Tweet: Specialty drugs are typically much more expensive than other drugs, and increased reliance on them is one driver of rising prescription drug spending. https://ctt.ec/3KJN3+ via @pgpfoundation


Tweet: The government is picking up a larger portion of the tab for prescription drugs. https://ctt.ec/3KJN3+ via @pgpfoundation



Jul 14, 2020

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