The cost of prescription drugs has skyrocketed since 2006, according to a new study. Find out why.
Retail drug prices, on average, more than doubled over a seven-year period, according to data from AARP.
The nonprofit’s latest Rx Price Watch report, which tracks prescription drugs widely used by older Americans, found that the retail cost of prescription drug therapy reached an average of $11,341 per drug, per year in 2013.
That’s up from an average of $5,571 in 2006, when Medicare implemented its prescription drug benefit, Medicare Part D.
Leigh Purvis, director of health services research in AARP’s Public Policy Institute, tells the Associated Press:
“Our concern with the prices we’re seeing is that the overall trend is really accelerating.”
The 2013 average cost of $11,341 is also unaffordable for retirees with low incomes and limited savings, Purvis says.
According to AARP, which advocates for senior citizens, the 2013 average cost is equivalent to:
- Almost three-quarters of the average Social Security retirement benefit ($15,526).
- Almost half of the median income for Medicare beneficiaries ($23,500).
- More than one-fifth of the median U.S. household income ($52,250).
The latest Rx Price Watch report also shows that drug price increases are outpacing inflation.
In 2013, for example, the average annual increase in retail prices for a combined set of 622 widely used prescription drugs was 9.4 percent. The general inflation rate, however, was 1.5 percent over the same period.
AARP attributes its findings on the much higher average cost “entirely” to price increases for brand-name and specialty drugs, which the nonprofit reports “more than offset often substantial price decreases among generic drugs.”
Of course, as is the case for most types of purchases, consumers are not obligated to buy brand-name drugs and can save a lot of money by buying generics.
To learn more about how to lower your drug costs — whether you use brand-name or generic drugs — start with:
- “10 Ways to Get Your Medications for Less“
- “Should You Buy Your Meds Through Online Pharmacies? Weigh the Pros and Cons“
What’s your take on AARP’s findings? Let us know what you think by commenting below or on our Facebook page.