Drug price hikes cost taxpayers $110 billion

Prescription drug prices are skyrocketing. One solution: Let Medicare negotiate for prices.

Another possibility: Limit drug price hikes to the rate of inflation. Medicare spent an extra $110 billion in recent years because drug prices increased faster than inflation.

That money could have bought lots of gas and groceries.

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$110 billion

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$110 billion could cover rent for 9 million American families for a year.

= 1,000,000 Families
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$110 billion could buy a year of college for 9 million American students.

= 1,000,000 Students
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$110 billion could buy groceries for 25 million American families for a year.

= 1,000,000 Families
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$110 billion could pay for gasoline for 56 million American families for a year.

= 1,000,000 Families
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$110 billion in needless Medicare spending figure from AARP Public Policy Institute (PPI) analysis of 2013-2017 data from the Centers for Medicare & Medicaid Services’ Medicare Part D Drug Spending Dashboard and Medicare Part B Drug Spending Dashboard. PPI compared annual price changes for each drug per dosage unit to what they would have been if limited to the rate of general inflation and used the revised drug prices to generate updated Medicare spending estimates. Drugs with less than 50 claims in any year and drugs with incomplete spending histories were excluded.

Housing comparison figures from the Joint Center for Housing Studies of Harvard University. College tuition figures from National Center for Education Statistics. Grocery figures from Bureau of Labor Statistics. Gas figures from Bureau of Labor Statistics.

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