Earlier this year, Iqvia released a report, The Use of Medicines in the U.S. 2022, which outlined some of the usage and spending trends with an outlook to 2026. The report notes that while patient out-of-pocket costs are falling, a small proportion have high costs, which can impact their use of medications.
The report found that spending on United States medicines increased 12% in 2021, primarily due to COVID-19 vaccines and other therapies. Iqvia also found that health services utilization returned to pre-pandemic levels at the end of 2021, but there is still a pandemic-induced backlog in missed patient visits, screenings and diagnostics, elective procedures, and new prescription starts. Further, prescription drug use reached a record 194 billion daily doses in 2021, as new prescription starts for chronic and acute care recovered from the 2020 slowdown.
Additionally, despite an increase in overall spend, costs per prescription are flat or slightly declining, on average. Spending on medications is expected to return to pre-pandemic growth trend lines by 2023.
Ongoing Pandemic Impact
As indicated above, we are still seeing affects from the COVID-19 pandemic. The cumulative Health Services Utilization Index across the pandemic (Q2 2020 – Q4 2021) remains at 90%, despite the recovery to pre-pandemic levels in more recent quarters. This indicates that there might be gaps in preventative and treatment services that have not been addressed, or it might be patients were able to avoid interactions with the healthcare system due to a decline in other routine illnesses, such as the flu.
However, Iqvia notes that doctor visits (to include both face-to-face visits and telemedicine) were the least impacted by the pandemic and have actually rebounded to higher than pre-pandemic levels. However, despite the significant increase in visits during the last half of 2021, the cumulative index across the pandemic remains 3% below pre-pandemic levels.
When it comes to screening and diagnostic tests, they have mostly rebounded to pre-pandemic levels, but the cumulative deficit is 5% below the baseline, with 41% of the deficit occurring when the pandemic was just taking off, between March and May 2020.
While the short-term impact from COVID-19 has been significant, the long-term impact on growth trends seems to be less so. The five-year compound annual growth rate to 2026 is unchanged compared to the pre-COVID-19 outlook when estimates of higher spending growth from COVID-19 vaccines and pandemic disruptions are included.
Prescription Medications
When it comes to the use of medicines, it has grown nearly 10% in the last five years. Additionally, retail drugs currently represent 86% of medicine use in the United States, meaning only 14% of use happens in non-retail settings. The use of drugs dispensed from retail pharmacies has continued to grow an average of 2.3% annually, reaching 166.5Bn days of therapy in 2021.
Looking at the past five years, spending at list prices (meaning the wholesale acquisition cost, or WAC) has increased from $581 billion to $776 billion. Payer net spending has increased from $463 billion to $586 billion over the last five years, at a compound annual growth rate of 4.8%.
While patient out-of-pocket costs rose $4 billion in 2021, non-retail out-of-pocket costs have remained stable over the last four years.