GOA: Drug Prices Rising Faster Than a Melting Raspa

National Journal (3/15, Fox) reports, “Prescription drug prices have risen more quickly over the past four years than costs for other medical goods and services,” the Government Accountability Office reported Monday.

The GAO found that “the average price of a basket of 100 commonly used generic and brand-name drugs rose 6.6 percent each year between 2006 and 2010.” For brand-name medications, “the prices rose 8.3 percent annually.”

 Modern Healthcare (3/15, Zigmond) reports, “Prescription drug spending in 2009 was about $250 billion, of which $78 bill! ion, or 31%, was spent by the federal government,” according to the GAO report.

 The report also noted that “‘some media reports suggested that prescription drug prices may have increased more during the debate leading up to passage of the Patient Protection and Affordable Care Act’ compared with recent years, but the report’s findings showed that the increase in the price index from the first quarter of 2009 through the first quarter of 2010 — before the bill passed — was 5.9%, which was less than the increase in the two prior years, but still higher than in 2006.” Reuters (3/15, Beasley) also covers the story

Editor’s Note: Every group we manage has experienced significant cost increases on their Rx plan. We have talked with other insurance consultants (yes we do talk to our competitors) and they all have said their book of business is also experiencing significant Rx cost increases. It seems to be an across the board phenomenon. The GOA explanation does not wash with what we see. So, there must be another driving factor to ever higher prescription drug costs. We think we know the answer.