Costs of prescriptions and doctor visits double in a decade

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Consumers paid roughly double in 2006 for prescription drugs over what they paid in 1996 -- an average of $161 per prescription, versus $79 a decade earlier -- and the price of visiting a doctor or an emergency room also skyrocketed in that time. Those findings come from the Department of Health and Human Services' Agency for Healthcare Research and Quality, which examined health-care expenses from 1996 to 2006 for adults between 18 and 44.

The average annual health-care expense increased significantly over that time, to $2,703 from $2,177, for this group, although almost 4% fewer people in that group had health-care expenses in 2006 -- which means those who did have expenses paid much more. Prescription drugs accounted to a far larger share of health-care costs for this age group: 17.6% of all health-care expenses in 2006, compared with 10.2% in 1996 (when, again, fewer in this group had such expenses).

Doctors, Dentists, and the Emergency Room

Inpatient hospital visits accounted for a lower share of the overall cost, and the average cost per day was about the same. But the average expense per emergency-room visit was substantially higher in 2006: $638, as opposed to $393 in 1996. The average visit to a physician cost $180 in 2006, but just $119 in 1996.

And while dental visits also cost more in 2006 ($247) than in 1996 ($181), the proportion of adults in this group with dental-care expenses fell in that period.

The distribution of expenses by source of payment in 2006 didn't change significantly: private insurance covered more than half of expenses in 1996 and in 2006, with a fifth coming out of pocket and most of the rest coming from Medicaid.

The Health-Care Debate

The timing of the report's release is interesting; it was prepared in August but released in the past week as the health-care debate raging on Capitol Hill has snagged in the Senate, due to amendments that would allow drug imports. The Food and Drug Administration opposes the re-importation of prescription drugs, due to logistical challenges -- and the drug industry opposes such amendments fiercely -- but making cheaper drugs available is one way to lower health-care costs.

This released report may further fuel the reform debate -- and could hurt pharmas' lobbying efforts. Democrats in Congress in November asked for two investigations of drug-industry pricing. "Recent studies have indicated that the industry may be artificially raising prices for certain pharmaceutical products in expectation of new reforms," they wrote to the General Accounting Office, citing a New York Times article. And reports from Wall Street and consumer groups that drug prices have risen 10% this year don't help pharmaceutical companies defend themselves.
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