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Top Healthcare Cost Drivers in 2015

Healthcare spending and rising costs are having a big effect on employers. As new treatments are developed, many Americans with employer-sponsored insurance continue to see increases in premiums and out-of-pocket costs, according to the most recent data from IMS Health. Here are some of the biggest drivers of healthcare spending, according to the U.S. Medicines Report.

Specialty drug spending

Specialty drugs account for one third of spending, driven in part by a wave of new treatments, IMS notes. Spending has increased almost $58 billion in the last five years, contributing to 73% of overall medicine spending growth in that time period.

Hepatitis C

The biggest driver of specialty spending growth is for drugs used to treat hepatitis C, accounting for $12.3 billion in spending. More than 3 million people in the U.S. are infected with the hepatitis C virus, but low treatment rates have persisted due to the disease’s slow progression and intolerable side effects of older therapies. Most insurance plans limit patient costs with annual out-of-pocket maximums, IMS says, but price was a dominant theme in patient, payer and doctor discussions of treatment.

Multiple sclerosis

MS spending increased close to 25% by the end of 2014. An estimated $13.9 billion was estimated, with $4.7 billion spent on new brand and oral therapies. Spending on injectable immunosuppressants, such as glatiramer acetate and natalizumab, increased 14% to $5.3 billion, but generic competition introduced this year could change spending costs. While patients with MS still face considerable burdens, IMS notes new medicines have brought a range of options in the past five years.

Oncologics

Oncologics led all other drug classes in spending with $32.3 billion in spending. New treatment options developed in the past few years account for close to 30% of spending increases. Supportive care treatments such as erythropoeitins, anti-nauseants and bisphosphonates, while contribution little to spending growth, often allow patients to continue on other treatments.

Diabetes

Diabetes spending increased 30.5% to $32.3 billion by the end of 2014. Insulins accounted for 63.3% of diabetes spending. Costs savings for insulin are on the horizon, though, as the first filings with the Food and Drug Administration for non-original biologic or biosimilar insulin therapies were made in 2014, and the first biosimilars are likely to launch in the U.S. in the next year.