AARP prescription drug Price Watch report shows cost of medicines vastly outpacing rate of inflation

The latest Rx Price Watch Report from the American Association of Retired Persons (AARP) has found that the retail price for widely-used brand-name prescription drugs has increased faster than the rate of inflation between 2006 and 2013. It also found that the difference between the speed of brand name drug price increases and the rate of inflation has been widening.

According to the report, retail prices for 227 brand-name prescription drugs widely prescribed to older Americans increased by 12.9% on average, while inflation was 1.5% in the same period.

Brand name drug price increases translate into higher out-of-pocket costs, especially for consumers who pay a percentage of drug costs (coinsurance) rather than a fixed dollar amount (co-payment). These increases also affect Medicare and Medicaid, and high government spending on price increases, the AARP says, will lead to higher taxes or cuts to public programs.