Predicted pharmaceutical spending 2010

For all the attention paid to drug costs, pharmaceutical spending annually accounts for a relatively small percentage of overall healthcare spending—about 10%, says Jane F. Barlow, MD, MPH, MBA, vice president of medical strategy and clinical quality for Medco Health Solutions.

The mean forecast among survey respondents is 16.8%, much higher than Dr. Barlow’s prediction. Understandably, members might estimate a high percentage, she says, because of the immediate effect they feel in their wallets when filling a prescription.

“Pharmacy is the area where you pay right out of your pocket at the time of service,” she says, but adds that the real focus should be on services and procedures.

“The medical benefit [spending] is so much bigger than the pharmaceutical benefit [spending],” Dr. Barlow says.

The greatest increase in pharmaceutical spending will be from specialty drugs, but that could slow down as competition in that area increases. Rising pharmaceutical spending can mean less overall healthcare spending because effective drug utilization as a first-line treatment can reduce the need for costlier, more complicated treatments later.

“The more you spend on the pharmacy sector, the better off you are in terms of medical spending,” she says.

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