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Hospitals' drug bills are likely going up in 2020

Health systems should expect a 4.57% increase in their drug spending in 2020, according to a new analysis by Vizient, a health care performance improvement company.

Why it matters: Some of the most expensive drugs on the market are administered in hospitals and doctors' offices, and they're folded into a patient's overall hospital bill.

By the numbers: The projected price increase is driven exclusively by brand-name drugs; spending on generics is projected to decrease by .02%.

  • The cost of specialty drugs, which already carry hefty price tags, is expected to rise by 4.23%.
  • Spending on biologics is expected to increase by 4.57%, while nonbiologic spending will go up by 3.87%.

Yes, but: Providers are often reimbursed based on a percentage of a drug's cost, which has led to accusations that they have an incentive to administer more expensive drugs even when cheaper options are available.

Go deeper: Think drug costs are bad? Try hospital prices