Prescriptions: Office Visits (4:1 ratio)

Often I talk about prescriptions as a driver of consumer awareness of healthcare costs. Since prescriptions really only represent 10% of total healthcare costs, this could be misleading. Certainly, it is important to focus on programs to reduce total medical costs. Ultimately, of course, we need to focus on prevention before either prescriptions or hospitalization is important, but for many reasons, that model isn’t one that aligns with our current healthcare system.

One of the reasons that prescriptions drive so much awareness is that we fill 4 billion prescriptions a year in the US and “only” visit the physician’s office, emergency room, or outpatient facility 1 billion times per year. Of course, all of these numbers clearly follow your 80/20 rule meaning that costs, prescriptions, visits, hospitalizations, etc. are really focused in a very narrow percentage of patients.

Another reason that my old boss recently talked about in an article is the fact that patients pay a greater percentage of costs (22%) for their prescriptions than they do for other healthcare costs.

One Response to “Prescriptions: Office Visits (4:1 ratio)”

  1. I agree with you that there are a disproportionate few driving the majority of pharmaceutical consumption. This 20% most likely correlates to older Americans. A demographic that is highly sensitive to price, vocal and with the free time available to make their opinions heard. And with some exceptions, older Americans are past the point of prevention and on to intervention-based treatments.

    Prevention sounds nice but is a public health initiative requiring a national commitment which we currently lack. It is also at odds with demand generation for Rx which is the backbone of modern pharmaceutical marketing. How would you reconcile two such vastly different goals?

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