10 Essential Facts About Medicare and Prescription Drug Spending
Prescription drugs play an important role in medical care for 57 million seniors and people with disabilities, and account for $1 out of every $6 in Medicare spending. The majority of Medicare prescription drug spending is for drugs covered under the Part D prescription drug benefit, administered by private stand-alone drug plans and Medicare Advantage drug plans. Medicare Part B also covers drugs that are administered to patients in physician offices and other outpatient settings.
After a period of relatively slow growth, total and per capita Part D spending has increased more rapidly in the past few years mainly due to treatments for Hepatitis C, and is projected to increase more rapidly in the next decade as more high-priced specialty drugs become available, according to the recently-released annual report of the Medicare Boards of Trustees.
Even with Medicare’s prescription drug coverage, beneficiaries can face substantial out-of-pocket costs, particularly if they use specialty drugs or multiple high-cost brand-name drugs. The following series of graphics examines trends in Medicare spending on prescription drugs, how Medicare coverage affects beneficiary access and costs, and what the public thinks about different options for keeping drug costs down.
1. Medicare accounts for a growing share of the nation’s prescription drug spending: 29% in 2014 compared to 18% in 2006, the first year of the Part D benefit.