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May 10, 2015 Newswires No comments
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Medicare releases data on drug spending

May 10--America's seniors suffer from a supremely costly diabetes problem. But in Pennsylvania, asthma and other respiratory issues are the big money kings, according to new prescription drug data released by Medicare, the health insurance program for senior citizens.

In Pennsylvania, prescriptions for Advair inhalers -- which treat chronic obstructive pulmonary disease symptoms as well as asthma -- were filled 424,000 times by Medicare patients in 2013, accounting for $141.34 million in federal spending.

That's the most spent on any one brand-name prescription in the state, federal records show.

The gross spending runner-up in Pennsylvania was Lantus and sister drug Lantus SoloSTAR, insulin medications for diabetics, accounting for $131.21 million. Third on the 2013 Medicare list was Nexium, the heartburn drug ($117.05 million in Pennsylvania prescriptions).

Nationwide, the Lantus brands topped the total Medicare drug cost list at $2.68 billion, followed by Nexium at $2.53 billion, then Advair ($2.38 billion) and Crestor, a cholesterol drug ($2.22 billion).

Spending figures represent the sum of the federal government's Medicare Part D subsidy, the beneficiary's share of the expense, plus any other subsidies or third-party insurer expenditures that go toward the cost of the drug.

Improving transparency

Last week's public release of the information represents the most detailed trove of prescription data issued by the U.S. Centers for Medicare and Medicaid Services since Medicare was expanded to include a prescription benefit, starting in 2006, under President George W. Bush.

The various charts published by CMS -- which is, in effect, the largest health insurer in the country -- include data on 36 million patients, 1 million physicians and prescribers, and $103 billion in total Medicare-related drug spending.

"CMS seems to be on a path toward greater transparency [when] it comes to how money is being spent, and who is spending it," said Juliette Cubanski, associate director of the Program on Medicare Policy at the Kaiser Family Foundation. "This is another step on this path."

Why is Advair the top money drug for seniors here? In Pennsylvania, COPD hospitalizations and over-65 asthma rates are higher than the national averages, which may account for Advair's top ranking.

Another reason: Even though Advair, a commonly prescribed brand-name drug from GlaxoSmithKline, lost its U.S. patent protection in 2010, there is no direct generic equivalent yet on the market, which is why the price of Advair has doubled from 2010 to 2015.

Experts caution about reading too much into the spending figures, and the same goes for the aggregate physician data (not surprisingly, the Pittsburgh physicians responsible for some of the highest-cost prescription orders work for neurosurgery, cardiology and oncology clinics).

But the numbers do provide insight into the drugs -- brand-name and otherwise -- that are driving the cost of the Medicare Part D, which accounted for $50 billion in net federal spending in fiscal year 2013, or 10 percent of the federal government's total net Medicare tab.

Perhaps more interesting than the gross drug spending figures is the data about the doctors who prescribed the drugs, and the prescribing patterns across various medical specialties within the Medicare program, said Erin A. Taylor, a researcher and Medicare Part D expert at Rand Corp. The CMS release marks the first time that Medicare has released physician-level prescribing information.

"Getting a sense of how many prescriptions are being used [and by whom] is a really exciting opportunity," Ms. Taylor said.

And as Medicare moves toward a payment system that rewards doctors and hospitals for the quality, not quantity, of health care, similar quality measures could be designed to reward physicians who meet certain prescription benchmarks.

"The hospital systems don't necessarily know" how a physician's prescription tendencies might stack up against peers from other health systems, or in other pockets of the country, Ms. Taylor said.

For example, physicians in southwestern Pennsylvania prescribed generics about three quarters of the time, which is the national average. But in Erie, generics are prescribed more often, and in Philadelphia, less often, according to the data released last week.

"Geographic variation [leads] to other questions about how different providers practice in different areas," Ms. Cubanski said. "As we get more evidence about what works and what doesn't work, we can begin to [examine trends] more closely when we have this level of detailed data."

Other findings

--The highest-cost drugs aren't necessarily the most-prescribed. Low-cost generics top the list of the most-prescribed drugs in Pennsylvania: Simvastatin, a cholesterol and lipid medication, was prescribed 2.12 million times to 372,000 Pennsylvania Medicare beneficiaries, followed by lisinopril, an ACE inhibitor that treats high blood pressure and heart failure, prescribed 2.03 million times to more than 356,000 Pennsylvanians.

--Opioid and painkiller use continues to grow among seniors.

Combined, various hydrocodone prescriptions (generics, Vicodin, Norco, plus combination drugs such as hydrocodone and acetaminophen, hydrocodone and ibuprofen, and so on) accounted for at least $18.7 million in spending, representing more than 310,000 Pennsylvania beneficiaries.

Oxycodone and its various brand-name iterations (Percoset, Oxycontin) plus combination drugs were dispensed to nearly 307,000 senior beneficiaries in 2013, costing more than $95 million. And tramadol was prescribed to more than 193,000 over-65 Pennsylvanians, at a cost of $9.4 million.

--In total, $5.35 billion was spent on prescriptions for Pennsylvania's Medicare beneficiaries in 2013.

Of the $103 billion in total drug spending within the Medicare program, about half of that, $50 billion, was spent by the federal government. While that number is growing annually, it is starkly lower than what what had been projected 12 years ago, when the new Medicare benefit was approved by Congress and Mr. Bush.

At the time, Democrats lamented the projected cost of the bill, and said the president had missed an opportunity to leverage the federal government's enormous buying power to drive down the cost of bulk medications for seniors.

But that happened naturally, largely due to brand-name drugs losing patent protection and being replaced in the U.S. market by cheaper generics, according to the non-partisan Congressional Budget Office. Nexium, which accounted for billions in Medicare spending nationally, lost its patent protection last year and will soon face generics competition.

"A combination of broader trends in the prescription drug market and lower-than-expected enrollment in Part D has contributed to much lower spending for the program -- about 50 percent lower in 2013 -- than CBO projected when the MMA became law in 2003," the CBO said in a July 2014 report.

"The magnitude of the slowdown that occurred surprised many observers -- drug spending per person for the country as a whole increased by only 2 percent per year, on average, between 2007 and 2010, compared with average growth of 13 percent per year between 1999 and 2003."

Bill Toland: [email protected] or 412-263-2625.

___

(c)2015 the Pittsburgh Post-Gazette

Visit the Pittsburgh Post-Gazette at www.post-gazette.com

Distributed by Tribune Content Agency, LLC.

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