Completed Work on Spending Trends

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Increases in prescription drug prices have been drawing great attention from Congress, the Administration, and the American public. OIG recently examined increases in reimbursement for brand-name drugs in Part D and found that total reimbursement for these drugs increased 77 percent from 2011 to 2015, despite a 17 percent decrease in the number of prescriptions for these drugs. After accounting for rebates, reimbursement for brand name drugs in Part D still increased 62 percent across this 5-year span. During that time period, the percentage of Part D beneficiaries responsible for out of pocket costs of at least $2,000 per year for brand name drugs nearly doubled. To control for the possibility that newer, more expensive brand name drugs may have driven increases in total Part D reimbursement, we also calculated unit costs for brand name drugs that were reimbursed in all 5 years, and found that for almost half of brand name drugs reviewed, Part D unit costs increased at least 50 percent.