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Archives | (July 2002)
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THE RISING TIDE OF PRESCRIPTION DRUG COSTS:
A CORPORATE CON JOB
------------------------------------------------------------------ Page 1 of 6 Over the past half-decade, Americans have reeled under the relentless assault of ever-higher prescription drug costs. For senior citizens – who purchase 42% of all prescription drugs – the burden has been particularly onerous, at times leaving them the untenable choice of either buying food or medicine. But there is more underlying the problem than just higher prices. At its core, the problem is symptomatic of a change in the way medicine is practiced in the United States – a change that is driven by the greed of multinational pharmaceutical giants. A change that more and more looks for answers in the form of a pill. The effects of this change are all too evident in healthcare cost statistics. In 2001, retail spending on prescription drugs rose by 17.1%, far outpacing other categories of healthcare costs. This was the fourth 15%-plus increase in as many years To put this in dollar terms, total spending on prescription drugs in the United States came to a whopping $154 billion in 2001, a $22.5 billion increase over the previous year. This figure is nearly double the $78.9 billion Americans spent on prescription drugs in 1997, and more than three times the $50.3 billion spent in 1993. Some fear that rising prescription drug costs may bankrupt the U.S. healthcare system. But solving the problem may be as complex as the factors that created it. FACTORS DRIVING SPIRALING PRESCRIPTION DRUG COSTSThere are actually three principle factors underlying the dramatic increase in prescription drug spending. The first, and most obvious cause for the increased spending, of course, are higher prices. The average price of a prescription was $49.84 in 2001, a 10.1% increase over 2000. By comparison, overall consumer prices rose just 2.8% for the same period. Between 1999 and 2000, the increase was 9.4%, again far outpacing inflation. But it was not price alone that caused the huge increase in outlays for prescription drugs. While the increase in drug prices accounted for 37% of the overall growth of spending on prescription drugs, another important factor was the kind of drug prescribed. |
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