Since 2014, the cost of prescription medications in the U.S. has surged by 37%, significantly outpacing the rate of inflation, according to data from drug savings company GoodRx. Although the pace of price increases has moderated this year compared to the previous decade, the rising costs are placing a greater financial burden on consumers. Currently, the average American spends $16.26 out of pocket per prescription.
Tori Marsh, Director of Research at GoodRx, highlighted the impact on consumers, particularly those with high-deductible plans, uninsured individuals, or those facing substantial out-of-pocket costs. “When costs rise, they inevitably impact consumers, especially those with high deductible plans or those without insurance,” Marsh explained.
GoodRx attributes the growing consumer cost burden to increasing copays, coinsurance, and deductibles. Over the past decade, the average deductible has nearly doubled, and many insurance plans have introduced additional tiers of drugs with higher copays. GoodRx refers to this phenomenon as “the big pinch,” as high medication costs are compounded by diminishing insurance coverage. Analyzing Medicare Part D plans from 2010 to 2024, GoodRx found that the proportion of covered medications has decreased by 19%.
Marsh described the situation as multifaceted: “Rising prices are a major factor, but combined with increased friction in accessing medications and reduced insurance coverage, the impact is substantial.”
The White House reports that Americans pay two to three times more for prescription drugs than consumers in other developed nations. As the 2024 election approaches, President Joe Biden has prioritized addressing drug costs. On Wednesday, the White House announced a reduction in prices for 64 prescription drugs for certain Medicare beneficiaries, following inflation penalties imposed on drug manufacturers. This adjustment, effective in the third quarter, is expected to benefit approximately 750,000 people, with potential savings of up to $4,593 per year.
GoodRx interim CEO Scott Wagner noted, “Despite ongoing efforts to improve affordability and accessibility, actual out-of-pocket costs for patients continue to rise and often come as a significant surprise.”
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