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Rx Price Watch Report: Trends in Retail Prices of Specialty Prescription Drugs Widely Used by Older Americans, 2017 Skip to content

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Rx Price Watch Report: Trends in Retail Prices of Prescription Drugs Widely Used by Older Americans, 2017 Year-End Update

The latest Rx Price Watch report by Leigh Purvis and Dr. Stephen W. Schondelmeyer finds that retail prices for widely used prescription drugs increased by an average of 4.2 percent in 2017. In contrast, the general inflation rate was 2.1 percent over the same period.

In 2017, the average annual retail cost for 754 brand name, generic, and specialty prescription drugs used to treat chronic conditions was almost $20,000 per year. This average annual cost was nearly 20 percent higher than the average Social Security retirement benefit ($16,848). The annual drug cost was also more than three-quarters of the median income for Medicare beneficiaries ($26,200) and almost one-third of the median US household income ($60,336).

Notably, the average annual cost for one medication used on a chronic basis would have been more than $12,500 lower in 2017 (i.e., $7,263 v. $19,816)  if the retail price changes for these products had been limited to general inflation between 2006 and 2017.

Prescription drug price increases affect consumers, employers, private insurers, and taxpayers who fund programs like Medicare and Medicaid. Spending increases driven by high and growing drug prices will eventually affect all Americans in some way.

If these trends continue, older Americans will be unable to afford the prescription drugs that they need, leading to poorer health outcomes and higher health care costs in the future.

These AARP Public Policy Institute reports are a continuation of our Rx Watchdog report series that has been tracking price changes for widely used prescription drugs since 2004.

For more information, please contact the AARP Public Policy Institute at (202) 434-3890.

Suggested Citation:

Purvis, Leigh, and Stephen W. Schondelmeyer. Rx PriceWatch Reports. Washington, DC: AARP Public Policy Institute, June 2019

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