Brand-Name Drugs Cost Medicare Billions

Doctors with ties to industry go with pricey versions instead of generics

By John Johnson,  Newser Staff

Posted Nov 19, 2013 12:16 PM CST

(Newser) – So much money wasted, such a seemingly simple fix. A ProPublica investigation finds that a relatively small group of doctors costs taxpayers hundreds of millions dollars per year because they choose to prescribe pricey brand-name drugs to low-income Medicare patients instead of generic versions. Is it because they have hearts of gold and believe the brand-name versions will be better for their patients, despite evidence to the contrary? Maybe. Or it could be because "many of these physicians also have accepted thousands of dollars in promotional or consulting fees from drug companies," according to the story. The total lost to over-prescribing is well into the billions over eight years.

One big problem is that Medicare, unlike the Department of Veterans Affairs and lots of private insurance plans, has no rules in place that limit doctors in prescribing brand-name drugs. One physician alone in Los Angeles could have saved Medicare $5 million in 2011 had he prescribed the way his peers did; said doctor also just happened to rake in $7,000 in speaking fees and meals from Big Pharma. Click for the full story, or for a previous one suggesting lax oversight of the Medicare Part D program.

  (Shutterstock)
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