Drug Spending Increases More Than 2.5 Times In Eight Years, USA

Main Category: Pharma Industry / Biotech Industry
Also Included In: Public Health;  Pharmacy / Pharmacist
Article Date: 18 May 2007 - 12:00 PDT

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Spending for medications prescribed in outpatient settings increased from 72 billion dollars in 1997 to 191 billion dollars in 2004, according to the latest News and Numbers from the Agency for Healthcare Research and Quality. The data cover spending by people who live in the community and were not in institutions such a nursing homes.

-- During the period 1997 to 2004, the average annual expenditure for prescription drugs for people age 65 and older increased 130 percent - rising from $819 in 1997 to $1,914 in 2004. The average out-of-pocket cost more than doubled for this group, increasing from $483 in 1997 to $1,027 in 2004.

-- The average annual amount spent on prescription drugs by people under age 65 who purchased prescription medications rose 140 percent from 1997 to 2004 - climbing from $347 in 1997 to $838 in 2004. From 1997 to 2004, the average annual amount this group spent out of pocket on prescription drugs rose from $143 to $304.

-- From 1997 to 2004, total purchases of outpatient prescription drugs increased from approximately 2 billion to nearly 3 billion prescriptions. This increase was fueled in part by a rise in the average number of prescription drug purchases per year by the elderly age 65 and older, which increased from 22 to 31 purchases per year.

-- In the same time frame, younger consumers also bought more prescription drugs on average. People under age 65 who purchased prescription medications, purchased 9 prescriptions a year on average. In 2004, this number rose to 13 prescriptions per year.

AHRQ, a part of the U.S. Department of Health and Human Services, works to improve the quality, safety, efficiency, and effectiveness of health care in the United States. The data in this AHRQ News and Numbers comes from the Agency's Medical Expenditure Panel Survey, a highly detailed source of information on the health services that Americans use, how frequently they use them, the cost of these services, and how they are paid.

For more information on this AHRQ News and Numbers see Trends in Outpatient Prescription Drug Utilization and Expenditures: 1997 and 2004

www.ahrq.gov