#USA #Washington #AARP #Medicare #Prescription Drugs

AARP Report Highlights Dramatic Drug Price Increases

A new report from the AARP Public Policy Institute indicates that the list prices of the top 25 drugs covered under Medicare Part D, which are not subject to price negotiation, have risen by an alarming average of 98% since their market entry. This data showcases the relentless cycle of price hikes imposed by pharmaceutical companies, culminating in unsustainable costs not just for patients but for the Medicare program as a whole.

Understanding the Context

Since the introduction of these medications, over 40% of their current list price has been attributed to hikes occurring well after their initial launch. In 2022 alone, these top 25 drugs collectively contributed to a staggering $50 billion in Medicare Part D expenditure, with over seven million beneficiaries relying on these critical medications. The top five drugs identified in this report include:

• - Trulicity (for diabetes)
• - Ozempic (for diabetes)
• - Trelegy Ellipta (for chronic obstructive pulmonary disease aka COPD)
• - Biktarvy (for HIV)
• - Xtandi (for cancer)

The implications of these price increases are profound, especially considering the median annual cost for a new brand-name prescription drug is currently around $300,000. This means that even minor price adjustments can lead to significant out-of-pocket expenses for patients.

Legislative Action on Drug Prices

In response to the escalating drug costs, Congress passed the Inflation Reduction Act in 2022, introducing significant reforms aimed at curtailing the rising prices of prescription medications. Key provisions of the legislation mandate that pharmaceutical companies be penalized if their drug prices ascend faster than the inflation rate. Furthermore, for the first time, Medicare has gained the authority to negotiate prices for selected drugs, a move expected to yield considerable savings for both patients and the Medicare program.

Starting January 2026, the negotiated prices for the first ten drugs selected by the Centers for Medicare & Medicaid Services will be implemented, with an additional 15 drugs to be negotiated by February 1, 2025. The urgency of these reforms cannot be understated, especially as millions of Americans face the staggering burden of high medication costs.

Voices from the Field

Leigh Purvis, a principal policy analyst at AARP, articulated the ongoing struggle faced by patients due to the continuous rise in drug prices: "Brand-name drug prices have been climbing at rates that far exceed general inflation for decades, severely restricting access to lifesaving medications for countless individuals in need."

Conclusion

As this report sheds light on the immense economic pressure exerted on Medicare beneficiaries, it highlights the critical necessity for sustained advocacy and reform in pharmaceutical pricing. AARP remains dedicated to empowering older adults by advocating for policies that enhance health security, financial stability, and overall well-being, ensuring that essential medications remain accessible to all who need them.

For further insights and to access the full report, visit AARP's website.