Drug costs aren’t the main reason US spends so much on healthcare, study finds

Payments to hospitals and physicians — not  drug prices — are the main reason the U.S. spends so much more on healthcare than other wealthy countries, despite much of the national conversation around healthcare spending being focused on drug costs, according to a report released by the Peterson Center on Healthcare and the Kaiser Family Foundation. 

The U.S. spends about twice as much per person on healthcare than other wealthy countries, with an average of $10,637 per capita in 2018 compared to $5,527 in other countries. 

Seventy-six percent of the difference in spending was due to inpatient and outpatient care. Drug costs made up only 10 percent of the difference. 

In 2018, the U.S. spent $1,397 per capita on drugs, compared to $884 in comparable countries. Even if per capita prescription drug pricing is lowered and closer to comparable countries, that difference would only make a dent in the overall difference in healthcare spending, the report said. 

Find the full report here.

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