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By Cyril Tuohy
In 2010, the 55 highest-expenditure Medicare Part B drugs represented $16.9 billion in spending, or about 85 percent of all Medicare spending on Part B drugs, and the 10 highest-expenditure drugs accounted for 45 percent of all Medicare Part B drug spending, according to testimony issued by the Government Accountability Office.
Part B expenditures for Epogen/Procrit used to fight anemia in end-stage renal disease patients came to $2 billion. Part B also spent $1.3 billion on Rituxan, used to combat cancer and rheumatoid arthritis, the report found.
That was followed by the $1.13 billion in spending on Lucentis, a drug used to fight age-related vision loss, $1.11 billion on the cancer-fighting drug Avastin, and $900 million on Remicade, a drug used to fight autoimmune disorders, the GAO found.
“Many of these drugs are particularly expensive for the Medicare program, either because they are used by a large number of beneficiaries or because their prices are high,” said James Cosgrove, director of Health Care for Medicare, in written testimony to lawmakers. “Furthermore, both the utilization and cost of these drugs are increasing.”
The testimony, delivered to the U.S. House subcommittee last month, highlights the findings of an earlier GAO examination of Part B drug spending and utilization trends, which found that most of the highest-price drugs were under patent and could only be bought from a single manufacturer. Patents generally last for 20 years before cheaper generics can hit the market.
In 2010, Medicare spent about $19.5 billion on Part B drugs, which represented about 9 percent of total Part B expenditures. The report also found that of the $16.9 billion Medicare spent for the 55 highest-expenditure Part B drugs, $11 billion was spent on drugs for which Medicare was the largest payer. Of the 55 highest-expenditure drugs, cancer was treated by more drugs than any other disease.
The annual per-beneficiary cost ranged from $13 for influenza vaccines, to $217,000 for drugs used to help hemophilia sufferers. The expenditure data was collected from Centers for Medicare & Medicaid Services’ national claims files.
Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. He can be reached at [email protected].
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