The Prescription Drug Cost Crisis: Why Millions of Americans Are Struggling
The Prescription Drug Cost Crisis in America
In 2019 alone, prescription drug cost increased an average of 10.5%.
That’s five times the rate of inflation. Four out of five Americans agree that prescription drug prices are exorbitant and unreasonable, according to a study by the Kaiser Family Foundation.
It’s obvious the U.S. drug pricing system is broken when one-third of patients admit they’re forced to skip prescription medicine because of the cost.
Millions of Americans are currently struggling with the cost of prescription drugs. But it doesn’t–and shouldn’t–have to be that way.
Why Are Prescription Drugs So Expensive?
The answer will likely stun you, but drug prices are rising because of a combination of two things.
One, shareholders are applying pressure to pharmaceutical companies to deliver higher profits. Big Pharma is reaping in vast sums of money while hurting the average American.
Two, there’s zero oversight in how prices are determined for medication. Yet the need for life-saving medication remains and so competing companies drive the prices ever higher out of greed.
Take insulin for example.
Insulin was discovered almost a century ago. Its price started under ten dollars.
Currently, Humalog and Novolog are two competing producers of insulin in America. When Novolog rose the price, Humalog followed suit and rose it even higher. In the last decade, the price has risen by over 300%.
A vial of insulin currently costs nearly $300. Do you know what it costs in Canada? Thirty dollars.
It’s price gouging, pure and simple.
And no, high prices don’t reflect the value of a drug and aren’t needed to fund the development of new medications.
Eight out of 10 drug manufacturers spend vast portions of their profits on advertising. Research and development are all too often ignored. A study found that the high price of prescription drugs in the U.S. produces billions more in revenue than needed to fund research.
High prices don’t equate value or automatically mean they’re a forever-cure. Many of the highest-priced drugs are the ones that manage chronic conditions like rheumatoid arthritis.
How to Fix the Prescription Drug Cost Epidemic
As with most things, power checks are needed. This would prevent monopolies, as has occurred with the pharmaceutical industry in America. To fix this, the government needs to pass regulations.
Recently, several senators proposed new legislation in an attempt to help reduce drug costs.
Called the Prescription Drug Affordability and Access Act, the legislation proposes to create an independent agency. This agency would be titled the Bureau of Prescription Drug Affordability and Access. It’d be tasked with reviewing drug prices and deciding on an appropriate price that isn’t excessive.
This approach would help ensure prescription drug prices were kept in check. Until this or something similar is approved, people will have to continue to research ways to cut the cost of prescription drugs.
Your Health Matters
Considering 56% of Americans feel employer-provided health insurance is a key factor in choosing and staying at a job, it’s important to offer your employees decent coverage.
To learn more about group insurance policies and how we can help with prescription drug costs, contact us today.