When Hospitals Mark Up Drug Prices

It’s not unusual for hospital bills to include outrageous prices for common items such as over-the-counter pain relievers or even warm blankets. You certainly don’t expect your hospital medications to be cheap, but a 700% markup seems outrageous — and rightly so. That 700% markup means a prescription with a retail price of $50 would cost you $350 simply because you received it in the hospital. Those medication costs add up quickly on a hospital bill and can result in overwhelming medical debt.

What Are Drug Price Markups?

When you are given a prescription drug during a hospital stay, you may already expect a markup on the price of that drug. What you may not expect is a markup between 7x and 10x what the hospital actually paid for the drug (which was usually a heavily discounted price to begin with). In fact, the average markup back in 2016, according to Becker’s Hospital Review, was around 480%, and 83% of hospitals charge at least double what they paid for medication. We can safely assume the average markup has increased even more over the past few years.

For-profit hospitals obviously need to make a profit to keep their doors open and the power on, but let’s face it: this kind of profit — made off vulnerable, sick, and struggling people — seems a little extreme.

hospital surgery

If you have trouble believing this really happens, here is a dramatic example of the incredible markups on critical medications: in July of 2018 a young girl was bitten by a venomous copperhead snake, and the cost of the antivenom that saved her life was $67,957 for four vials. The average list price for four vials would be $12,792 — which means that the markup for this life-saving drug was over 500%. Imagine paying 5x the list price for a life-saving medication! Had this young lady’s family not had insurance, the hospital bill could have bankrupted them.

Who Suffers the Most from Drug Price Markups

As shocking as this may be, these exorbitant markups on medication are an accepted practice in the medical industry and are considered one of the factors contributing to the high cost of medical care in the United States. Individuals and families that do not have insurance cannot possibly pay such exorbitant prices, and the result is overwhelming medical debt — they are the ones hit the hardest by such heartless policies. Even more shocking is that insurance providers are charged a lower rate than self-payers — usually about 200% of the original cost.

How Hospitals Get By With Outrageous Medication Markups


Hospitals receive medications from the pharmaceutical companies at a significant discount compared to what you would pay at the pharmacy — and this makes these extreme markups all the more outrageous. Hospitals are free to choose what they will charge, with very few states enacting any type of limit or cap and no federal oversight whatsoever. This freedom is due in part to the influence that hospitals have when it comes to both public policy and political campaigns. Until elected leaders are willing to stand up to for-profit hospitals in the medical community, nothing is expected to change. The good news is that not all hospitals practice such extreme markups on drug prices. The hospitals that do markup drug prices the most are for-profit hospitals (making not-for-profit a better option for the uninsured).

What To Do If You Are Impacted by Medication Markups


If you are uninsured or underinsured, these prescription drug markups will impact your hospital bill and your wallet. When going through your medical bills, you can check on the average prices for prescription drugs by performing some simple web searches. If you see that a drug has been dramatically marked up, contact the hospital billing office to see if it would be possible to negotiate that price down, and have information on hand about its normal retail price. You would be surprised at how far negotiations will go in helping to reduce your existing medical bills.


Drug price markups are common, and they contribute to the rising cost of medical treatment here in the United States. While it makes sense that for-profit hospitals need to make a profit in order to stay operational, a 10x markup on the already discounted price they paid for a drug seems outrageous, and few can afford to pay it. And these markups are not expected to go down anytime in the near future. If you are seeking medical treatment and want to keep your hospital bills as low as possible, then look for a non-profit hospital near you. Non-profit hospitals have a reputation for charging much lower markups on medications. If you have already received a bill with these markups, try negotiating with your medical provider for a lower price.

Contact Consumer Medical Bill Solutions

If you are feeling overwhelmed by medical debt and don’t have the time or skill to negotiate with your debt holders, contact Consumer Medical Bill Solutions today. We can help you reduce your medical debt by 25% to 45% (and in some cases up to 75%), and that includes both network and non-covered expenses. We will negotiate on your behalf to reduce your overall medical debt and put a stop to the collection efforts that are disrupting your peace. Our process is straightforward and our methods work. Contact us today!