Index Overstated Drug Price Rise
WASHINGTON — The government’s inflation index exaggerated how fast prescription drug prices rose over the past decade, according to congressional auditors.
The method the Labor Department’s Bureau of Labor Statistics used to gauge rising drug prices may have overstated the inflation by 23% to 36%, the General Accounting Office said Tuesday.
The auditors cited three flaws: The sample the government checked did not include enough new drugs, the index failed to take into account savings from consumers switching to generic drugs or other lower-cost substitutes, and the index failed to measure product improvements.
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