PHP14 - Prescription Drugs Prices and Source of Payments in The US from 1997 to 2015

Abstract

This study aims to evaluate prescription drug prices over time and the relationship between income level and sources of payments from 1997 to 2015. Data were extracted from the Medical Expenditure Panel Survey. Using Prescribed Medicines files, 12 payment sources were categorized into 4 payment groups: public, private, self/family and other. Household data were used to categorize income into 5 groups relative to the poverty line. Regression models were used to evaluate inflation adjusted prescription drug prices over time and the relationship between income level and source of payments taking into account the complex survey methodology. The inflation adjusted cost per prescribed medication increased from $38.73 to $73.34 from 1997 to 2015. The amount paid by self/family significantly declined from $17.50 to $9.61 (p<0.001). On the other hand, public payments significantly increased from $5.87to $34.43 (p<0.001). Sources of payment had sudden changes around 2006 and 2009. Before 2006 out-of-pocket payments for low-income and near poor were 51.4% and 46.5%, respectively. These were significantly higher out-of-pocket payments by high-income (40.8%) subjects. After 2007, out-of-pocket expeneditures declined to 20.4% and 17.2% for the low-income and near poor, respectively. Payment for prescriptions from public sources exceeded 50% for negative poor in 2004, near poor in 2006 and low-income in 2009. The time by income group interaction term was significant for predicting the proportion of public expenditures (p<0.001), indicating a slower growth in public spending among higher income levels. Prices for prescribed medications in the US have increased substantially over the past two decades. In the late 1990s, half of cost of the prescribed medicines was paid by consumers. Since the passage of Medicare Part D and Affordable Care Acts, both the amount and proportion of prescription medications expenditures paid by consumers has declined, meanwhile pubic payments have dramatically increased.