The analysis, published in the journal Health Affairs, estimates that by 2026, national health spending will climb to $5.7 trillion, or nearly a fifth of the economy. Prescription drug spending is forecast to grow at 6.3 percent per year, on average, between 2017 to 2026.
Drug spending skyrocketed in 2014 and 2015, driven largely by the use of a new generation of curative therapies for hepatitis C. When national health spending data was released in December showing a 1.3 percent increase in spending on prescription drugs in 2016 — a small fraction of the increases in previous years — a pharmaceutical lobby spokeswoman highlighted the trend as evidence of the “nation’s competitive marketplace for medicines.”
The new analysis suggests the low rate of increase will not last. CMS actuaries said the secret rebates that manufacturers negotiate with health plans have helped temper the growth of prescription drug prices and spending in recent years but will not contribute as much in the future. The prescription drug data does not include drugs administered in physicians’ offices or in hospitals.
The rebates have become a major part of the pharmaceutical industry’s recent lobbying efforts, with a push for patients to receive the secretly negotiated rebates directly when they fill their prescriptions. Critics of the industry have argued that although such a measure could provide some relief to some people, it will further insulate drug prices from any downward pressure.