Brand-Name Drugs are Favored by Medicare Beneficiaries

According to this article in EmaxHealth, brand-name medications account for almost two-thirds of all prescriptions filled by Medicare beneficiaries. Patients are asking for brand-name drugs when the program provides coverage and are asking pharmacists for generic drugs when they have to pay out of pocket.

When patients switch from brand-name to generic drugs, more than likely they’ve reached the coverage gap in which they must cover the full cost of the prescriptions. Woody Eisenberg, Medco Chief Medical Officer mentions that when Medicare beneficiaries become aware of the coverage gap they "become acutely aware of the cost difference between brand-name and generic drugs and most make the switch."

Medicare Advantage Paid Too Much

Fierce Healthcare reports that studies form the Medicare Payment Advisory Commission suggest that private health care plans for Medicare beneficiaries may be a good place to start cutting. The studies also show that private insurance plans are driving up costs because they are paid on average 13 percent more than allocated for traditional Medicare. Do you think private health care plans should be cut?

Medicare Co-Pays and Premiums Expected to Rise

FierceHealthcare reports today that a recent study conducted by Avalere Health LLC found that for the largest 10 drug companies, premiums are expected to rise up an average of 31 percent next year. It is also speculated that this in term might cause insurers to increase drug co-payments 75 percent (about $7) for generic drugs and a 60% increase (about $40) for brand drugs.

A spokesperson from Humana, an insurer, mentions:

“Prices reflect the experience we've seen over the past three years, and our expectations around what will most interest our members and potential members going forward."

Billions Paid in Medicare Suspect Claims

The National Center for Policy Analysis reports that billions of taxpayer dollars have gone to waste because Medicare has paid out claims with blank or invalid diagnosis codes over the past decade according to a new Senate report.

Claims for wheelchairs, drugs, and other medical supplies of Medicare patients were reviewed from 2001 to 2006. During these years, they found at least $1 billion of medical equipment which listed diagnosis codes that had little or no connection to the reimbursed medical items. Here are some findings from the report:

• Medicare paid millions of dollars to medical suppliers for blood glucose test strips -- used exclusively for diabetics -- based on non-diabetic diagnoses.
  
• Roughly $4.8 billion in payments were made from 1995 to 2006 despite invalid coding or nothing listed at all; about $23 million of that amount was paid after 2003, when federal rules made clear the codes were required.
• Based on a sample of 2,000 of those invalid coding claims, investigators found more than 30 percent could not be verified as legitimate and "bore characteristics of fraudulent activity."
• Federal regulations require that Centers for Medicare and Medicaid Services (CMS) pay only for items that are deemed "medically necessary," yet, CMS does not examine diagnosis codes to determine whether the equipment is actually necessary before making payment.
• Only 3 percent of claims are reviewed after payment is made.
  

Sources:
http://hsgac.senate.gov/public/
http://townhall.com/news/us/2008/09/24/probe_medicare_paid_billions_in_suspect_claims

Medicare Monthly Premium Costs Remain the Same for Elderly and Disabled in 2009

AHN reports that Medicare premiums for the disabled and elderly will remain constant at $96.40 next year, according to the U.S. Centers for Medicare & Medicaid Services.

The premium and deductible paid by consumers cover home health facilities, durable medical equipment, and cost of physicians. The Medicare Part B Program will also retain its costs at $135 this year. So far the only costs expected to rise is monthly premium payment for Part A coverage which will rise form $423 to $443 in 2009.

Medicare Pays Too Much for New Generics

According to this article on The Wall Street Journal Blog when the price of generic drugs plunges, Medicare is slow to reflect that price change.

A report published by the Health and Human Services’ inspector general looks at irinotecan, which is a cancer that went generic in February of this year. The average price of the drug factoring in sales of the branded version was $52. During the current quarter, Medicare was paying about $75 for irinotecan, which is still far above the average price.

Read the full report here.