TRENTON, N.J. (AP) — Spending on prescription medicines in the U.S. fell for the first time in decades last year, slipping as cash-strapped consumers continued to cut back on use of health care services.
Patients also benefited from a surge of new, inexpensive generic versions of widely used drugs for chronic conditions like high cholesterol, according to a new report.
Total spending on medications dipped 1 percent, to $325.8 billion last year from $329.2 billion in 2011. Likewise, average spending per person on medicines fell by $33, to $898 last year, according to the report from the IMS Institute for Healthcare Informatics.
“That’s the first time IMS has ever measured a decline in the 58 years we’ve been monitoring drugs,” Michael Kleinrock, director of research development at the institute, told The Associated Press.
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Kleinrock said that while total drug spending fell by just 1 percent, the decline was 3.5 percent after accounting for population growth and economic expansion.
Factors behind last year’s drop in drug spending include positive trends such as more use of cheap generic pills and flukes such as a fairly mild cold and flu season in early 2012. But there also was a big negative: people rationing their own health care.
IMS found affordability of health care remains a big problem for many Americans, with growing out-of-pocket costs forcing people to go without needed doctor visits, medicines and other treatments.
For some, that was because they lost jobs or homes during the worst recession in decades. But higher costs also are hitting many employed people who have health insurance.
Employers have been raising health costs for their workers well above the inflation rate, through higher copayments, premiums and deductibles. Many commercial insurance plans now have annual deductibles — the amount a patient must pay before insurance kicks in — that exceed $1,000, Kleinrock said.
The number of insured people with consumer-directed plans, where patients face very high deductibles and sometimes pay 20 percent of costs after that, has jumped from about 8 percent in 2008 to 19 percent last year. Now many folks insured through their jobs have such plans, not just young, healthy people buying insurance on their own.
“Even patients with insurance are feeling the pinch and have been reducing their use of health care,” Kleinrock said.
The report notes that out-of-pocket costs, which exclude monthly health plan premiums, are now three times higher than they were five years ago, on average. They’re seven times higher for those with consumer-directed plans.
That’s one reason the number of doctor visits, planned hospital admissions and outpatient treatments each dipped by a half-percent to 1 percent last year, compared with 2011.