Choosing Generic Rx Drugs Could Save Medicare Billions

By Robert Preidt
HealthDay reporter

WEDNESDAY, March 3, 2021 (HealthDay News) – Wider use of generic prescription drugs could save Medicare nearly $ 2 billion a year, researchers say.

The new analysis of Medicare Part D prescription drug claims for 2017 randomly used 20% of beneficiaries, 224 drugs with one or more generic substitutes, and at least 1,000 claims.

Medicare Part D accounts for about a third of all prescription drug spending in the United States.

All 50 states and the District of Columbia have laws promoting the distribution of generic drugs.

But in 2017, prescribing clinicians and Medicare Part D patients collectively requested brand-name drugs rather than generics 30% of the time when a brand-name drug was dispensed, according to the study.

Out of 169 million filled prescriptions analyzed, 8.5 million were for brand name drugs when generics were available.

Of these, the prescriber requested a brand name drug rather than a generic version 17% of the time (1.4 million requests), and patients requested 13.5% of the time (1.1 million of requests).

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In 2017 alone, the Medicare Part D program would have saved $ 977 million if all brand-name prescriptions clinicians requested had been filled with a generic, according to the study from the Johns Hopkins University Bloomberg School of Public Health.

If the patients themselves had requested generics, the Medicare Part D program would have saved an additional $ 673 million in 2017, for a total savings of $ 1.7 billion, the researchers concluded.

The study was published online on March 2 in JAMA network open.

“Even with laws in place, demand for a brand-name drug is much more frequent than it should be,” said study author Gerard Anderson, professor of health policy and management at Bloomberg School. “This distribution model results in exponentially higher costs for the Medicare Part D program and for patients.”

Medicare patients would have saved $ 161 million in 2017 if prescribers had requested generic drugs. If the patients themselves had requested generics, they would have saved an additional $ 109 million, according to the results.

In total, Medicare patients spent $ 270 million more than needed on prescription drugs in 2017, the authors said.

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They also found that in 2017, Medicare Part D spent $ 4.42 billion on brand name drugs for which no specific selection was indicated by a clinician or pharmacist.

Brand name prescription drugs only represent 5% of Medicare Part D claims when brand name and generic drugs are available. But the researchers said the findings underscore the cost of brand name drugs to the Medicare program and its beneficiaries.

“Patients should always be aware of the additional costs to themselves and to taxpayers associated with applying for a brand-name prescription drug,” said study author Ge Bai, associate professor of policy and health management.

“Prescribing clinicians can also play an important role in educating their patients about the safety and effectiveness of generic drugs,” Bai said in a Johns Hopkins press release.

More information

The United States Food and Drug Administration has more on generic drugs.

SOURCE: Bloomberg School of Public Health at Johns Hopkins University, press release, March 2, 2021

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