A new report finds that prescription drug costs are rising at an alarming rate, at a faster pace than the overall inflation rate. Researchers say just 23 drugs account for half the increase. CBS News Correspondent Sharyl Attkisson has the story.
Americans are buying prescription drugs in record amounts and paying more for them, too. According to the National Institute for Health Care Management, Americans spent $132 billion last year. That's up 19% from the year before, up nearly 40% over 2 years.
The giant spending increase is partly due to sheer volume, say researchers. There are more drugs on the market and more people buying them.
But experts say the price of an average prescription is also to blame. The cost jumped 10.5% last year--three times higher than the 3% inflation rate.
Most people may not notice the rising price of prescription drugs because their health insurance covers most of the cost. In fact, Americans are paying less out-of-pocket cost today than they did 10 years ago.
Better insurance with low copayments is another reason people are filling more prescriptions--an average of ten a year--according to the study. But people are paying indirectly through higher premiums.
Patients are also learning more about different drugs on television. The remedies for arthritis, depression, and allergies are the most popular products. The biggest seller is the heavily marketed ulcer-fighter Prilosec.
Milt Williams has been filling prescriptions for 50 years and says he's never seen anything like it. "People go to their doctors, saying, 'This is what I saw on TV. This is what I want and I'm not leaving this office until I get it,'" he says.
The pharmaceutical industry says all the spending has actually translated into savings.
"A patient is certainly better off paying $140 for a drug treatment as opposed to paying $28,000 for an operation for a bleeding ulcer," says Alan Holmer, of the Pharmaceutical Research and Manufacturers of America.
Those without prescription drug benefits (such as one in three Medicare recipients), however, may not be as enthusiastic about costlier medicines. If Congress decides to add a prescription benefit for those people, as has been debated on the Hill for the past few months, more seniors could afford expensive drugs. If that happens, experts say, the drug spending could go up even more.
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