Institute:Office of National Coordinator (ONC) Workforce Training Curriculum
Component:Introduction to Health Care and Public Health in the U.S.
Unit:Financing Health Care - Part 2
Lecture:Factors Contributing to Increasing U.S. Health Care Costs
Slide content:Pharmaceutical Costs Estimated 10% of total health care expenditures $298 billion in 2014; $40.3 billion 1990 Average ~12% increase over the last 10 years Drug costs inflated above Consumer Price Index (CPI)/other health care sectors Increased availability Medications for chronic disease e.g. cholesterol, diabetes Increased demand Cancer chemotherapy 9
Slide notes:New technology has permitted the pharmaceutical industry to develop new medications for the treatment of disease. Pharmaceutical costs are estimated to be approximately ten percent of the total health care expenditures annually. These costs have increased seven-fold since 1990. During the last decade, pharmaceutical costs have increased annually by an average of twelve percent per year, far exceeding the consumer price index and inflation in other health care sectors. Part of these costs relate to increased utilization and demand for medications to treat terminal or chronic disease. For example, medications to treat illnesses and conditions such as diabetes, HIV, and elevated cholesterol, have increased survival. Yet, at the same time, this may lead to increased utilization of health care services and newer, more expensive medications, which will ultimately drive up health care costs. Another example involves the demand for new drugs, such as cancer chemotherapy, that may increase survival by only a few months, but may cost many times more than established treatments. 9