Are High Cost Medications Actually Driving Up Healthcare Spending?

Low cost medications that are frequently prescribed could potentially be driving up Medicaid drug spending.

Although high cost specialty medications have been contributing to health spending, a recent study suggests that a majority of Medicaid outpatient drug spending is on more frequently prescribed medications.

A study published by the Kaiser Family Foundation analyzed the list prices for the 50 costliest drugs before rebates from 2014 to 2015.

They found that the most commonly prescribed drugs are antibiotics that treat treat pain or chronic illness. However, researchers did not find these to be the costliest drugs, since they are not expensive per prescription.

Researchers found that drugs like Abilify and Vyvanse for behavioral health conditions, Sovaldi and Harvoni for hepatitis C, and Truvada for HIV, were the costliest for Medicaid. It was discovered that 45 of the costliest drugs were considered high-cost, because they were frequently prescribed, according to the study.

Researchers found that 28 of the most frequently prescribed medications were not expensive on a per prescription level. They also found that 17 of the medications were frequently prescribed, in addition to being costly.

Although much legislation has been adopted to prevent opioid abuse, the researchers found multiple opioid drugs in the frequently prescribed category. In the study period, opioids were the second most prescribed drug group.

Overall, antivirals, including HIV and hepatitis C treatments, accounted for 20% of the costliest drugs. At 16%, the second costliest group was composed of antiasthmatics and bronchodilators.

Interestingly, none of these drugs were considered costly on a per prescription basis, but are considered costly because of how frequently they are prescribed.

The third costliest group included ADHD, anti-narcolepsy, and anti-obesity medications, which made up 14% of drugs included in the study. These drugs are also frequently prescribed, but not costly on an individual level.

Researchers also found that a majority of costly drugs have regulatory and market exclusivity, which allows manufacturers to set a high price. To control growing prescription drug prices, costs and access to the medication should be balanced, according to the study.

Researchers concluded this study could provide information about which prescription medications are increasing drug costs, and whether it is largely due to high volumes of drugs being prescribed.