Brand Medications and Medicare Part D: How Eye Care Providers' Prescribing Patterns Influence Costs

Abstract

Purpose: To quantify costs of eye care providers' Medicare Part D prescribing patterns for ophthalmic medications and to estimate the potential savings of generic or therapeutic drug substitutions and price negotiation.

Design: Retrospective cross-sectional study.

Participants: Eye care providers prescribing medications through Medicare Part D in 2013.

Methods: Medicare Part D 2013 prescriber public use file and summary file were used to calculate medication costs by physician specialty and drug. Savings from generic or therapeutic drug substitutions were estimated for brand drugs. The potential savings from price negotiation was estimated using drug prices negotiated by the United States Veterans Administration (USVA).

Main outcome measures: Total cost of brand and generic medications prescribed by eye care providers.

Results: Eye care providers accounted for $2.4 billion in total Medicare part D prescription drug costs and generated the highest percentage of brand name medication claims compared with all other providers. Brand medications accounted for a significantly higher proportion of monthly supplies by volume, and therefore, also by total cost for eye care providers compared with all other providers (38% vs. 23% by volume, P < 0.001; 79% vs. 56% by total cost, P < 0.001). The total cost attributable to eye care providers is driven by glaucoma medications, accounting for $1.2 billion (54% of total cost; 72% of total volume). The second costliest category, dry eye medications, was attributable mostly to a single medication, cyclosporine ophthalmic emulsion (Restasis, Allergan, Irvine, CA), which has no generic alternative, accounting for $371 million (17% of total cost; 4% of total volume). If generic medications were substituted for brand medications when available, $148 million would be saved (7% savings); if generic and therapeutic substitutions were made, $882 million would be saved (42% savings). If Medicare negotiated the prices for ophthalmic medications at USVA rates, $1.09 billion would be saved (53% savings).

Conclusions: Eye care providers prescribe more brand medications by volume than any other provider group. Efforts to reduce prescription expenditures by eye care providers should focus on increasing the use of generic medications, primarily through therapeutic substitutions. Policy changes enabling Medicare to negotiate prescription drug prices could decrease costs to Medicare.