High prescription drug costs can contribute to out-of-pocket spending burdens for consumers and can lead patients to delay or forgo needed medications they cannot afford. Recent congressional negotiations have focused on policies to expand health insurance coverage and lower drug costs, including authorizing the negotiation of drug prices for people with Medicare and private health insurance, requiring rebates for price increases that outpace inflation, and capping out-of-pocket costs in Medicare.
In this brief, we explore prescription drug affordability challenges using pooled 2018 and 2019 data from the Medical Expenditure Panel Survey. We primarily focus on the extent to which elderly adults ages 65 and older with Medicare and nonelderly adults ages 19 to 64 with year-round private insurance delay or forgo needed prescription drugs because of the cost and their out-of-pocket spending burdens. We find the following:
- Nearly 13 million adults delayed or did not get needed prescription drugs in the past year because of the cost, including 2.3 million elderly Medicare beneficiaries and 3.8 million nonelderly adults with private insurance, 1.1 million with Medicaid, and 4.1 million who were uninsured at any point during the year.
- About 1 in 10 adults who were uninsured all year (9.5 percent) or part of the year (11.6 percent) reported unmet prescription drug needs, compared with 4.9 percent of Medicare beneficiaries, 3.0 percent of privately insured adults, and 5.6 percent of adults with Medicaid.
- For both Medicare beneficiaries and privately insured adults, unmet prescription drug needs were most common among women, people with low incomes, and people with multiple chronic health conditions. Nearly all Medicare beneficiaries and more than 8 in 10 privately insured adults with unmet needs have been diagnosed with a chronic condition such as high blood pressure, high cholesterol, stroke, diabetes, arthritis, and respiratory illnesses.
- More than one-quarter of adults with Medicare (25.4 percent) and 5.3 percent of privately insured adults spent more than 1 percent of their family incomes on their individual out-of-pocket prescription drug costs. More than 3 percent of Medicare beneficiaries—and nearly 7 percent of beneficiaries with unmet prescription drug needs—spent more than 10 percent of their family incomes on prescription drugs.
Policies to reduce drug prices and limit out-of-pocket spending could increase access to needed prescription drugs for adults with Medicare and private coverage, and efforts to expand coverage to the uninsured population could further improve prescription drug affordability.