Among people who are not Medicare beneficiaries, similar differences in utilization and spending exist between prescription drug users with and without coverage. Those with coverage for drugs fill two-thirds more prescriptions but spend a third less out of pocket than those without coverage. About a third of Medicare beneficiaries accounted for three-fourths of beneficiaries' total drug spending in 1996. Only 13 percent had no spending at all. Spending on prescription drugs in the non-Medicare population is even less evenly distributed.
Prescription drugs take up about one-sixth of all health spending by the elderly.
Prescription drug spending also accounts for a larger share of spending by people with low incomes than it does for people with higher incomes. The burden of prescription drug costs creates access problems for some beneficiaries. Drug spending has grown more quickly than other health spending throughout the 1990's. Price increases, higher utilization, and the use of newer, more expensive drugs all play a part in increasing drug spending. In today's market for prescription drugs, most insurers obtain significant discounts on behalf of their insured beneficiaries.