Kaiser: Diabetes, Antivirals, and Psychotherapeutics Rank Highest for Drug Spending

May 28, 2019

Where plans and patients are spending the most money on medications.

Spending for anti-diabetic agents, antivirals and psychotherapeutics were highest for large employer plans, Medicare Part D, and Medicaid, according to a recent analysis of pharmaceutical drug spending by the Kaiser Family Foundation (KFF).

In addition, out-of-pocket drug spending for patients was highest for drugs to treat cancer, multiple sclerosis, and rheumatoid arthritis in large employer plans and Medicare Part D, the analysis says.

The goal of the KFF analysis was to offer policy makers context as they debate legislation and policies to reverse rising drug costs.

Some of the other findings include:

  • 82% of retail prescription drug spending was from private insurers, Medicare, and Medicaid

  • 14% of patients paid out-of-pocket to cover retail prescription drugs

  • The top five drugs with the highest total spending account for at least 10% of total prescription drug spending in large employer plans, Medicare Part D, and Medicaid

  • For Medicare Part D and Medicaid, drug spending for hepatitis C (Harvoni) took the top spot at $6.6 billion in 2016 (not accounting for rebates)

  • For private insurers, rheumatoid arthritis (Humira) ranked highest at $4.9 billion (not accounting for rebates)

  • Antibiotics and asthma/allergy drugs were used most frequently for large employer plans, while medications for high blood pressure and high cholesterol were used most commonly in Medicare Part D

Total spending
In 2017, total prescription drug spending rose to $333 billion. The top 50 drugs accounted for nearly 40 percent of the drug spending for private insurers, Medicare Part D, and Medicaid.

Related article: Will Drug Price Hikes Impact Drug Spending?

Here is a breakdown of drug spending:

  • Private health insurance: $140 billion

  • Medicare Part D: $101 billion

  • Out-of-pocket spending: $47 billion

  • Medicaid: $33 billion

  • Other payers: $13 billion

Out-of-pocket spending

The costs of out-of-pocket spending also varied plan. For example, enrollees in Medicare Part D spent $365 a year on prescription drugs in 2016, while participants in large employer plans spent $132 during the same period.

“The analysis is based primarily on claims data by payer, which does not account for rebates paid by drug manufacturers to pharmacy benefit managers, insurers, and state Medicaid programs,” KFF says. “Rebates differ by payer, and are estimated to be larger for Medicaid than Medicare Part D or private employers.”

To view the data, go to the Peterson-Kaiser Health System Tracker.  

Dan Verdon, is vice president, content and strategy, MultiMedia Healthcare, LLC.

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