National Health Expenditures

Abstract from Health Affairs article

Unfortunatlely, the article isn't free.

"Health spending growth through 2013 is expected to remain slow because of the sluggish economic recovery, continued increases in cost-sharing requirements for the privately insured, and slow growth for public programs. These factors lead to projected growth rates of near 4 percent through 2013. However, improving economic conditions, combined with the coverage expansions in the Affordable Care Act and the aging of the population, drive faster projected growth in health spending in 2014 and beyond. Expected growth for 2014 is 6.1 percent, with an average projected growth of 6.2 percent per year thereafter. Over the 2012–22 period, national health spending is projected to grow at an average annual rate of 5.8 percent. By 2022 health spending financed by federal, state, and local governments is projected to account for 49 percent of national health spending and to reach a total of $2.4 trillion."

Note the acceleration in prescription sales starting in 2014.  Much of this will come from increasing specialty drug sales.  It's a good time to start talking to your PBM about how to manage this growth.

IMS reports 2006 drug sales up 8.3%

View the press release and related charts here: http://www.imshealth.com/ims/portal/front/articleC/0,2777,6599_3665_80415465,00.html
Obtain the latest Retail Drug Monitor at http://www.imshealth.com/vgn/images/portal/cit_40000873/31/60/80273141IMS%20Retail%20Drug%20Monitor%20for%20December%202006.pdf

Some interesting tidbits:

• Utilization grew at 4.6% compared to 3.2% for 2005, with Medicare Part D increasing utilization by 1-2%
• They expect 2007 drug sales to increase by 6-9%
• Biotech sales grew 20% to $40.3 billion, (14.7% of total sales)
• Chain pharmacy Rxs grew 5.8%, independent pharmacy Rxs grew 1.9% and mail-service Rxs grew 4.2%

The biggest challenge to payers remains how to manage the 20% growth in biotech drugs. I believe that payers will need to start restricting coverage to select indications in order to help maintain affordability of their health benefit programs. You may want to review how Britain's National Institute for Health and Clinical Excellence (NICE) deals with these issues. http://www.nice.org.uk/guidance