Comparing hospital prices to drug prices is absurd. And although the article claims to be about prices, the chart actually shows National Health Expenditure (NHE) spending numbers, not prices.

Despite that, hospital spending has grown at a slower rate than drug spending over the time period displayed in the chart. And as a percentage of the NHE, hospital care actually declined from 42.7 percent in 1980 to 34 percent in 2016, compared to retail prescription drug spending, which doubled as a share of total national health expenditures. The NHE data don’t separate drugs used together in a hospital setting out from overall hospital spending, so there is drug spending hidden within the hospital numbers.

As global pharmaceutical giants pocket record profits, one out of every four American hospitals operates in the red. But the gravity of the health care cost problem requires all stakeholders, especially pharmaceutical companies,  to work towards a solution that helps reduce costs for patients.

That's why hospitals and health systems are redesigning their delivery systems and embracing new reimbursement models. They're leveraging technology to treat patients at home and offer specialized care to underserved communities.

Hospital prices have also grown more slowly than drug prices, despite rising input costs. Hospital price growth as measured by the Producer Price Index, has remained under 2 percent for each of the last four years. Even before that, since 2008, hospital prices had an average annual growth rate of 2 percent.

In comparison, the overall price of medical care had an average annual growth rate of 3 percent, while drug prices had a significantly higher average annual growth rate of 5.6 percent for that same time period.

Related News Articles

Headline
The House Ways and Means Committee today approved the Prescription Drug Sunshine, Transparency, Accountability and Reporting Act (H.R. 2113), AHA-supported…
Headline
The Senate Finance Committee held on Tuesday the third in a series of hearings on drug pricing in America, which focused on the role of pharmacy benefit…
Headline
The House Energy and Commerce Subcommittee on Oversight and Investigations today held the
Headline
A Department of Health and Human Services’ Office of Inspector General proposal to change drug discount safe harbors under the federal anti-kickback statute…
Headline
The House Committee on Energy and Commerce yesterday passed a number of AHA-supported bills that would lower prescription drug costs and strengthen the…
Headline
The AHA expressed support for a number of bills being considered today by the House Committee on Energy and Commerce that would lower prescription drug costs…