US prescription drug spending grew just 0.4% in 2012, reaching $263.3 billion, compared to 2011’s growth of 2.5%, say new government figures.
National health expenditures overall increased just 2.7% in 2012, reaching $2.8 trillion and remaining low for the fourth consecutive year, reports the Office of the Actuary at the Centers for Medicare and Medicaid Services (CMS), in a new analysis. This level is similar to the 3.6%-3.8% rates seen annually since 2009, meaning that growth during all four years has been at the slowest rates ever recorded in the 53-year history of the National Health Expenditure Accounts.
Health spending as a share of US Gross Domestic Product (GDP) fell slightly, from 17.3% in 2011 to 17.2% in 2012, says the analysis, which appears in the current issue of Health Affairs. Lead author Anne Martin points out that the low spending growth rates and relative stability since 2009 primarily reflect the lagged impacts of the economic recession.
“Additionally, 2012 was impacted by the mostly one-time effects of a large number of blockbuster prescription drugs losing patent protection and a Medicare payment reduction to skilled nursing facilities,” adds Ms Martin, an economist in the CMS Office of the Actuary.
The latter payment reduction was the major contributor to 2012’s 4.8% rise in spending on Medicare, the health programme for seniors and some disabled people, down from a 5% rise in 2011. Spending growth also slowed for private health insurance – down to 3.2% from 3.4% – and nursing care facilities and continuing care retirement communities, at 1.6% down from 4.3% in 2011.
However, growth accelerated in 2012 for: – hospital spending, at 4.9% from 3.4% in 2011; – physician and clinical services – 4.6% from 4.1%; and – Medicaid, the state/federal health programme for people on low incomes, at 3.3% from 2.4%.
Out-of-pocket spending growth also accelerated in 2012, to 3.8% from 3.5% in 2011, mainly because of greater cost-sharing for physician and clinical services, but this growth was moderated by reduced out-of-pocket spending on patent-expired brand-name prescription drugs.
The Affordable Care Act (ACA) had a minimal impact on 2012’s aggregate health spending, except for areas such as increased Medicaid rebates for prescription drugs and the Medicare drug coverage gap discount programme – the “doughnut hole,” says the CMS, which also notes that the “unusually large” number of blockbuster drugs losing patent protection in late 2011 and 2012 included Pfizer’s cholesterol-lowerer Lipitor (atorvastatin), Sanofi/Bristol-Myers Squibb’s blood-thinner Plavix (clopidogrel) and Merck & Co’s asthma/allergic rhinitis treatment Singulair (montelukast).
