Spending on Dual Over-the-Counter and Prescription Drugs in the Medicare Part D Program.

This study compares Medicare and patient spending for dual over-the-counter and prescription drugs with their over-the-counter cash prices.

Reimbursement to Pharmacies for Generic Drugs by Medicare Part D Sponsors.

This study evaluates whether organizations that offer Medicare Part D plans (referred to as Part D sponsors) overpay pharmacies for generic drugs.

Utilization Management Trends in Medicare Part D Oncology Drugs, 2010-2020.

This study examines the exposure of Medicare Part D beneficiaries to utilization management, such as prior authorization, for oral oncology drugs.

Insulin Fills by Medicare Enrollees and Out-of-Pocket Caps Under the Inflation Reduction Act.

This study uses data from IQVIA's National Prescription Audit to assess the association of the Inflation Reduction Act's cap on cost sharing with insulin fills by Medicare beneficiaries.

Added Therapeutic Benefit of Top-Selling Brand-name Drugs in Medicare.

Importance: The Inflation Reduction Act of 2022 authorizes Medicare to negotiate prices of top-selling drugs based on several factors, including therapeutic benefit compared with existing treatment options. Objective: To determine the added therapeutic benefit of the 50 top-selling brand-name drugs in Medicare in 2020, as assessed by health technology assessment (HTA) organizations in Canada, France, and Germany. Design, Setting, and Participants: In this cross-sectional study, publicly available therapeutic benefit ratings, US Food and Drug Administration documents, and the Medicare Part B and Part D prescription drug spending dashboards were used to determine the 50 top-selling single-source drugs used in Medicare in 2020 and to assess their added therapeutic benefit ratings through 2021. Main Outcomes and Measures: Ratings from HTA bodies in Canada, France, and Germany were categorized as high (moderate or greater) or low (minor or no) added benefit. Each drug was rated based on its most favorable rating across countries, indications, subpopulations, and dosage forms. We compared the use and prerebate and postrebate (ie, net) Medicare spending between drugs with high vs low added benefit. Results: Forty-nine drugs (98%) received an HTA rating by at least 1 country; 22 of 36 drugs (61%) received a low added benefit rating in Canada, 34 of 47 in France (72%), and 17 of 29 in Germany (59%). Across countries, 27 drugs (55%) had a low added therapeutic rating, accounting for $19.3 billion in annual estimated net spending, or 35% of Medicare net spending on the 50 top-selling single-source drugs and 11% of total Medicare net prescription drug spending in 2020. Compared with those with high added benefit, drugs with a low added therapeutic rating were used by more Medicare beneficiaries (median 387 149 vs 44 869) and had lower net spending per beneficiary (median $992 vs $32 287). Conclusions and Relevance: Many top-selling Medicare drugs received low added benefit ratings by the national HTA organizations of Canada, France, and Germany. When negotiating prices for these drugs, Medicare should ensure they are not priced higher than reasonable therapeutic alternatives.

Prescription Drug Spending in Fee-for-Service Medicare, 2008-2019.

Importance: Prescription drug spending is a topic of increased interest to the public and policymakers. However, prior assessments have been limited by focusing on retail spending (Part D-covered drugs), omitting clinician-administered (Part B-covered) drug spending, or focusing on all fee-for-service Medicare beneficiaries, regardless of their enrollment into prescription drug coverage. Objective: To estimate the proportion of health care spending contributed by prescription drugs and to assess spending for retail and clinician-administered prescriptions. Design, Setting, and Participants: Descriptive, serial, cross-sectional analysis of a 20% random sample of fee-for-service Medicare beneficiaries in the United States from 2008 to 2019 who were continuously enrolled in Parts A (hospital), B (medical), and D (prescription drug) benefits, and not in Medicare Advantage. Exposure: Calendar year. Main Outcomes and Measures: Net spending on retail (Part D-covered) and clinician-administered (Part B-covered) prescription drugs; prescription drug spending (spending on Part B-covered and Part D-covered drugs) as a percentage of total per-capita health care spending. Measures were adjusted for inflation and for postsale rebates (for Part D-covered drugs). Results: There were 3 201 284 beneficiaries enrolled in Parts A, B, and D in 2008 and 4 502 718 in 2019. In 2019, beneficiaries had a mean (SD) age of 71.7 (12.0) years, documented sex was female for 57.7%, and 69.5% had no low-income subsidies. Total per-capita spending was $16 345 in 2008 and $20 117 in 2019. Comparing 2008 with 2019, per-capita Part A spending was $7106 (95% CI, $7084-$7128) vs $7120 (95% CI, $7098-$7141), Part B drug spending was $720 (95% CI, $713-$728) vs $1641 (95% CI, $1629-$1653), Part B nondrug spending was $5113 (95% CI, $5105-$5122) vs $6702 (95% CI, $6692-$6712), and Part D net spending was $3122 (95% CI, $3117-$3127) vs $3477 (95% CI, $3466-$3489). The proportion of total annual spending attributed to prescription drugs increased from 24.0% in 2008 to 27.2% in 2019, net of estimated rebates and discounts. Conclusions and Relevance: In 2019, spending on prescription drugs represented approximately 27% of total spending among fee-for-service Medicare beneficiaries enrolled in Part D, even after accounting for postsale rebates.

Association Between Payments by Pharmaceutical Manufacturers and Prescribing Behavior in Rheumatology.

OBJECTIVE: To evaluate the association between pharmaceutical industry payments to rheumatologists and their prescribing behaviors. METHODS: A cross-sectional analysis was conducted of Medicare Part B Public Use File, Medicare Part D Public Use File, and Open Payments data for 2013 to 2015. Prescription drugs responsible for 80% of the total Medicare pharmaceutical expenditures in rheumatology were analyzed. We calculated the mean annual drug cost per beneficiary per year, the percentage of rheumatologists who received payments, and the median annual payment per physician per drug per year. Industry payments were categorized as food/beverage and consulting/compensation. Multivariable regression models were used to assess associations between industry payments and both prescribing patterns and prescription drug expenditures. RESULTS: Of 4822 rheumatologists in the Medicare prescribing databases, 3729 received any payment from a pharmaceutical company during this time frame. Food/beverage payments were associated with an increased proportion of prescriptions for the related drugs (range, 1.5% to 4.5%) and an increased proportion of annual Medicare spending for the related drugs (range, 3% to 23%). For every $100 in food/beverage payments, the probability of prescribing increased (range, 1.5% to 14% for most drugs) and Medicare reimbursements increased (range, 6% to 44% for most drugs). Consulting/compensation payments were associated with an increased proportion of prescriptions (range, 1.2% to 1.6%) and an increased proportion of annual Medicare spending (range, 1% to 2%). For every $1000 in consulting/compensation payments, both the probability of prescribing increased (5% or less for most drugs) and Medicare reimbursements increased (less than 10% for most drugs). CONCLUSION: Payments to rheumatologists by pharmaceutical companies are associated with increased probability of prescribing and Medicare spending.

Five-year impact of Medicare Part D coverage gap reform on drug expenditures and utilization.

OBJECTIVE: To estimate the impact of the Medicare Part D coverage gap reform under the Affordable Care Act (ACA) on the utilization of and expenditures for prescription drugs within the first five years of the policy's implementation. DATA SOURCES: 2008-2015 Medicare Current Beneficiary Survey (MCBS). STUDY DESIGN: We used a difference-in-differences approach to estimate the year-by-year changes in prescription drug use and expenditures before (2006-2010) and after (2011-2015) the ACA's Part D coverage gap reform between Part D beneficiaries not receiving the Low-Income Subsidy (LIS) and those receiving the LIS. DATA COLLECTION: The study sample included Part D beneficiaries (a) aged 65 years or older; (b) not disabled or having end-stage renal disease; (c) continuously enrolled in a Part D plan (d) having at least one prescription fill in a given year. Survey-reported and administrative Part D events data in the MCBS were used for the analyses. PRINCIPAL FINDINGS: After the ACA reform, annual out-of-pocket drug spending significantly decreased by $88 (P < .01) among non-LIS beneficiaries compared to LIS beneficiaries, with growing decreases over time (average decreases of $41 in 2011, $49 in 2012, $105 in 2013, and $135 in 2015, P < .01 or <.05). Changes in out-of-pocket costs were largely driven by significant decreases among brand-name drugs (overall decrease of $106, P < .01). Despite significantly reduced out-of-pocket spending, there were no significant changes in the overall number of 30-day drug fills and total drug spending; however, changes in the use of brand-name and generic drugs were seen after the ACA (increase of 1.9 fills for brand-name drugs and decrease of 2.3 fills for generic drug in 2015, P < .05). CONCLUSIONS: The ACA coverage gap reform has helped to reduce the out-of-pocket drug cost burden for beneficiaries, although it had no noticeable impact on drug use or total drug spending.

Cancer history, insurance coverage, and cost-related medication nonadherence in Medicare beneficiaries, 2013-2018.

BACKGROUND: Cancer survivors are at risk of financial hardships and cost-related medication nonadherence, particularly among those without adequate insurance coverage. OBJECTIVE: To examine the association between cancer history and cost-related medication nonadherence, as well as the association between insurance coverage and nonadherence among Medicare beneficiaries. METHODS: We used the 2013-2018 Medicare Current Beneficiary Survey Public Use File, a survey on the health, health service utilization, access to care, and satisfaction among a nationally representative sample of Medicare beneficiaries. Cost-related medication nonadherence was defined as often or sometimes reporting any of the following: (1) took smaller dose of medication, (2) skipped doses to make medication last, (3) delayed medication because of cost, and (4) not get medication because of cost. Logistic regression was used to estimate the odds ratio of cost-related nonadherence associated with cancer history, adjusting for survey year and sociodemographic characteristics of the respondents, including age, sex, race and ethnicity, highest grade completed, income level, marital status, and number of chronic conditions. We also included Medicare Part D, an interaction between Part D and the low-income subsidy, and Medicare Advantage in the model to examine the effect of insurance coverage on cost-related nonadherence. RESULTS: From 2013 to 2018, there were 12,492 cancer survivors and 53,262 respondents without a history of cancer in our sample, and 16.5% reported cost-related medication nonadherence. After adjusting for characteristics of the respondents, cancer survivors were more likely than those without a history of cancer to report cost-related medication nonadherence (adjusted OR = 1.10; 95% CI = 1.02-1.19). Having unsubsidized Part D-Part D without the low-income subsidy-was associated with a greater likelihood of reporting cost-related medication nonadherence (adjusted OR = 1.63, 95% CI = 1.49-1.78), while having subsidized Part D was not (adjusted OR = 0.96; 95% CI = 0.85-1.08). Finally, being on Medicare Advantage was associated with lower likelihood of reporting cost-related nonadherence compared with traditional fee-for-service Medicare (adjusted OR = 0.86; 95% CI = 0.80-0.92). CONCLUSIONS: Expanding the low-income subsidy and capping out-of-pocket drug expenditure can be effective policy options to reduce cost-sharing burden and cost-related nonadherence. DISCLOSURES: For this study, Li was partially supported by a research grant from the National Cancer Institute (R01CA225647). The sponsor had no role in the design or implementation of the study, analysis or interpretation of the data, or drafting or approval the manuscript. The authors report no conflicts of interest.

Patient and Payer Incentives to Use Patented Brand-Name Drugs vs Authorized Generic Drugs in Medicare Part D.

Importance: In response to scrutiny over high drug prices, manufacturers of insulin and direct-acting antiviral agents for treating hepatitis C have recently introduced authorized generic alternatives to their patented brand-name products. These authorized generic drugs have list prices at least 50% lower than the list price of the brand-name drugs, which should result in savings to patients. However, it is unclear whether these authorized generic drugs are offered on Medicare Part D formularies because they may not provide savings to plans or Medicare. Objective: To assess Medicare Part D formulary coverage for 4 brand-name formulations of insulin and direct-acting antiviral agents and their authorized generic formulations. Design, Setting, and Participants: This cross-sectional study used Medicare Prescription Drug Plan Formulary and Pricing Information Files from quarter 3 of 2020 and Medicare Part D plan enrollment for September 2020. Four patented brand-name drugs (sofosbuvir and velpatasvir fixed-dose combination tablets [Epclusa], ledipasvir and sofosbuvir tablets [Harvoni], insulin lispro [Humalog], and insulin aspart [Novolog]) and their authorized generic formulations for all Part D stand-alone prescription drug plans (n = 959) and Medicare Advantage prescription drug plans (n = 3148) were studied. Main Outcomes and Measures: Beneficiary-weighted formulary coverage of brand-name and authorized generic products; beneficiary out-of-pocket costs; and prerebate plan, manufacturer, and Medicare spending on brand-name and authorized generic products. Results: In quarter 3 of 2020, 97% of beneficiaries were in plans that covered brand-name drugs only or both brand-name and authorized generic drugs; approximately 3% were in plans that covered authorized generic drugs only. Observed authorized generic drug list prices were 67%, 62%, and 50% lower than list prices for Epclusa, Harvoni, and each brand-name insulin product, respectively. Medicare beneficiaries using authorized generic drugs could save $270 per year for 12 vials of Humalog and $2974 for a full course of Harvoni. Plans, however, have limited incentives to encourage authorized generic drug use because rebates for brands likely exceed savings available with authorized generic drugs, particularly for beneficiaries with spending that reaches the Medicare Part D coverage gap. Conclusions and Relevance: The results of this cross-sectional study suggest that authorized generic drugs for insulin and direct-acting antiviral agents may lower out-of-pocket spending for patients but are unlikely to provide savings for Part D plans or Medicare. Instead, these drugs allow manufacturers to offer products at a lower list price without materially lowering net prices or profits.

Availability of Cost-effectiveness Studies for Drugs With High Medicare Part D Expenditures.

Importance: Prescription drug spending in the US requires policy intervention to control costs and improve the value obtained from pharmaceutical spending. One such intervention is to apply cost-effectiveness evidence to decisions regarding drug coverage and pricing, but this intervention depends on the existence of such evidence to guide decisions. Objective: To characterize the availability and quality of cost-effectiveness studies for prescription drugs with the greatest Medicare Part D spending. Design, Setting, and Participants: In this national cross-sectional analysis, publicly available 2016 Medicare drug spending records were merged with 2016 US Food & Drug Administration Orange Book data and the Tufts Medical Center Cost-Effectiveness Analysis (CEA) Registry. All studies published through 2015 that evaluated the cost-effectiveness of the 250 drugs for which Medicare Part D spending was the greatest in US-based adult patient populations were included. Data were analyzed from September 2018 to June 2020. Main Outcomes and Measures: The presence and quality of published cost-effectiveness analyses for the 250 drugs for which Medicare Part D spending was greatest in 2016 were assessed based on the inclusion of key cost-effectiveness analysis elements and global ratings by independent reviewers for the Tufts CEA Registry. Results: Medicare Part D spending on the 250 drugs in the sample totaled $122.8 billion in 2016 (84.1% of total spending). Of these 250 drugs, 91 (36.4%) had a generic equivalent and 159 (63.6%) retained some patent exclusivity. There were 280 unique cost-effectiveness analyses for these drugs, representing data on 135 (54.0%) of the 250 drugs included and 67.0% of Part D spending on the top 250 drugs. The 115 drugs (46.0%) without cost-effectiveness studies accounted for 33.0% of Part D spending on the top 250 drugs. Of the 280 available studies, 128 (45.7%) were industry sponsored. A large proportion of the studies (250 [89.3%]) did not meet the minimum quality requirements. Conclusions and Relevance: In this cross-sectional study, a substantial proportion of 2016 Medicare Part D spending was for drugs with absent or low-quality cost-effectiveness analyses. The lack of quality analyses may present a challenge in efforts to develop policies addressing drug spending in terms of value.

Cost to Medicare of Delayed Adalimumab Biosimilar Availability.

Launched in 2002, originator adalimumab (Humira) is the top revenue-generating drug in the United States. Between 2016 and 2019, the US Food and Drug Administration approved 5 adalimumab biosimilars, yet none have been marketed owing to patent dispute settlements. We sought to calculate the cost of this delayed entry to Medicare over this period by estimating the difference between reported spending on originator adalimumab and estimated spending on originator and biosimilar adalimumab products assuming timely biosimilar market entry. Estimates of potential biosimilar spending were calculated based on the following evidence-based projections: (i) market capture of 15% for the first biosimilar and 5.5% for successive biosimilars in their first year on the market, and 5% annually thereafter; (ii) price reductions of 3.5% per year and 2.4% per additional biosimilar entry for originator adalimumab; and (iii) price discounts of 25% at launch, 3.4% per year, and 1.7% per additional biosimilar entry for biosimilar adalimumab. Based on these assumptions, had adalimumab biosimilars launched upon approval, estimated non-rebate spending on them would have been $18.3 million in 2016, $225.7 million in 2017, $436.2 million in 2018, and $727.7 million in 2019, whereas estimated non-rebate spending on originator adalimumab would have been $2.33 billion, $2.04 billion, $1.78 billion, and $1.42 billion. Cumulative spending on adalimumab would have thus been $8.98 billion instead of an observed $12.11 billion. Accounting for estimated rebates, total predicted savings would have been $2.19 billion. Reforms for timely biosimilar availability will be critical in ensuring optimal savings for Medicare after biosimilar approval.