Medicare Could Save Millions if Brand-Name Combo Drugs Swapped for Generics

A retrospective analysis of 29 brand-name combination medications suggests that if Medicare Part D beneficiaries had instead received prescriptions for their generic constituents, the Medicare drug benefit program could have saved an estimated $925 million. Researchers recently published their findings in JAMA.

“Promoting generic substitution and therapeutic interchange through prescriber education and more rational substitution policies may offer important opportunities to achieve substantial savings in the Medicare drug benefit program,” researchers wrote.

The study zeroed in on Medicare Part D spending for 29 brand-name combination medications in 2016. For the analysis, researchers grouped the brand-name medications into 1 of 3 categories: constituents available as generic medications at identical doses, generic constituents at different doses, and generic substitutes that are therapeutically equivalent.

For branded combination drugs available as generics at identical doses group, Medicare spent $303 million, researchers reported. Spending for the generic constituents would have been an estimated $68 million, however, resulting in a $235 million savings.

For branded combination drugs available as generics at different doses group, Medicare spent $232 million. Spending for the generic constituents would have been an estimated $13 million, resulting in a $219 million savings, according to the study.

For the therapeutically equivalent generic substitutes group, Medicare spent $491 million on the brand-name combination products. Spending for the generic constituents would have been an estimated $20 million, a difference of $471 million.

Added together, the estimated spending difference between brand-name combination drugs and their generic constituents regardless of group was $925 million.

“For the 10 most costly combination products available during the entire study period,” researchers added, “the listed Medicare spending could have been an estimated $2.7 billion lower between 2011 and 2016 if the generic constituents had been prescribed.”

—Jolynn Tumolo