FacebookTwitterGoogle+RedditEmail

Tremendous Waste in Medicare Diabetes Drugs Revealed

by MARTHA ROSENBERG

Walid Gellad, M.D., M.P.H. is an assistant professor of medicine at the University of Pittsburgh, and a staff physician and researcher at the Pittsburgh VA Medical Center.  His research focuses on physician prescribing practices and on policy issues affecting access to medications for patients. He recently granted this interview with CounterPunch reporter Martha Rosenberg.

Martha Rosenberg: Your study in the Annals of Internal Medicine’s July 16 issue [Brand-Name Prescription Drug Use Among Veterans Affairs and Medicare Part D Patients With Diabetes] compares the use of brand name diabetes drugs in Medicare and the VA and concludes that one billion dollars a year could be saved a year if Medicare adopted the VA’s prescribing habits.

Walid Gellad: Yes we looked at diabetes-related medications like oral hypoglycemics, insulins, statins and ACE inhibitors and found that use of brand-name drugs was much greater in Medicare than the VA in almost every region of the country–two to three times as high as Medicare.

Rosenberg: When you started this research, did you expect such dramatic findings?

Gellad: I expected rates would be higher in Medicare, but didn’t realize they would be so much higher. As a VA doctor, I often see veterans who have outside insurance but still come to the VA to get cheaper drugs. For example, some patients might come in to get Lipitor at the discounted, VA price, but they didn’t realize they could switch drugs to get a less expensive, generic instead–one that could be filled outside the VA.

Rosenberg: Can you explain the difference between the two agencies’ prescribing systems?

Gellad: Medicare uses over 1,000 private plans with distinct formularies to administer its drug benefit, whereas the VA administers its own benefit using one national formulary. All veterans face the same low cost sharing, and benefits are managed by a central pharmacy benefits manager which has substantially lowered pharmacy spending for the VA.

Rosenberg: You write that previous studies have compared medication pricesbetween the VA and Medicare but not medication choices and cite the VA’s promotion of therapeutic substitution. Can you explain?

Gellad: That’s rightand medication choice is just as important for controlling spending as price is.  In this paper we look at what might happen to spending if price actually stays the same, but we changed the drugs prescribed. Unlike generic substitution in which a generic drug might be switched for a brand drug like simvastatin for Zocor [the generic and brand names of the same drug] therapeutic substitution, done by a clinician, interchanges generic drugs that are in the same class but not identical to the brand drug–for example, generic simvastatin might be substituted for the brand name atorvastatin which is Lipitor.

Rosenberg: Another factor you cite in cost savings is the lack of visits of drug reps to the VA.

Gellad: That is one potential factor, yes. Most VA doctors are not visited by pharmaceutical sales representatives and do not give out free samples. We are also a salaried workforce and it may be possible that doctors who are willing to accept salaries have a different perspective on marketed drugs.

Rosenberg: You write that private Part D plans can lose market share if they don’t offer the popular, brand name drugs. Yet those are the exact drugs that inflate costs!

Gellad: Yes, it was thought that if the Part D plans had to compete to get members they will keep prices lower, but the flip side is they need to offer the drugs patients are asking for if they want Medicare beneficiaries to enroll.

Rosenberg: If government administered plans produce such cost savings, what is the appeal of private plans?

Gellad: The appeal of having many private plans administer the drug benefit is that competition between them presumably will offer patients more choices and better prices, in a well functioning marketMany people would not accept a central government authority making decisions about drugs available to them. It turns out, however, that all drugs are available to individuals receiving benefits through VA, it’s just that in some cases physicians have to make a good case for why they are needed.  I am not proposing Medicare turn into the VA, but the truth is that financial resources for Medicare are limited. Money spent in one place that is not needed cannot be spent in another. There can’t be a medical reason that so many more patients on Medicare need brand name drugs compared to those than at the VA.

Martha Rosenberg is an investigative health reporter. She is the author of  Born With A Junk Food Deficiency: How Flaks, Quacks and Hacks Pimp The Public Health (Prometheus).

Martha Rosenberg is an investigative health reporter. She is the author of  Born With A Junk Food Deficiency: How Flaks, Quacks and Hacks Pimp The Public Health (Prometheus).

More articles by:

CounterPunch Magazine

minimag-edit

bernie-the-sandernistas-cover-344x550

zen economics

Weekend Edition
February 24, 2017
Friday - Sunday
Jeffrey St. Clair
Roaming Charges: Exxon’s End Game Theory
Pierre M. Sprey - Franklin “Chuck” Spinney
Sleepwalking Into a Nuclear Arms Race with Russia
Paul Street
Liberal Hypocrisy, “Late-Shaming,” and Russia-Blaming in the Age of Trump
Ajamu Baraka
Malcolm X and Human Rights in the Time of Trumpism: Transcending the Master’s Tools
John Laforge
Did Obama Pave the Way for More Torture?
Mike Whitney
McMaster Takes Charge: Trump Relinquishes Control of Foreign Policy 
Patrick Cockburn
The Coming Decline of US and UK Power
Louisa Willcox
The Endangered Species Act: a Critical Safety Net Now Threatened by Congress and Trump
Vijay Prashad
A Foreign Policy of Cruel Populism
John Chuckman
Israel’s Terrible Problem: Two States or One?
Matthew Stevenson
The Parallax View of Donald Trump
Norman Pollack
Drumbeat of Fascism: Find, Arrest, Deport
Stan Cox
Can the Climate Survive Electoral Democracy? Maybe. Can It Survive Capitalism? No.
Ramzy Baroud
The Trump-Netanyahu Circus: Now, No One Can Save Israel from Itself
Edward Hunt
The United States of Permanent War
David Morgan
Trump and the Left: a Case of Mass Hysteria?
Pete Dolack
The Bait and Switch of Public-Private Partnerships
Mike Miller
What Kind of Movement Moment Are We In? 
Elliot Sperber
Why Resistance is Insufficient
Brian Cloughley
What are You Going to Do About Afghanistan, President Trump?
Binoy Kampmark
Warring in the Oncology Ward
Yves Engler
Remembering the Coup in Ghana
Jeremy Brecher
“Climate Kids” v. Trump: Trial of the Century Pits Trump Climate Denialism Against Right to a Climate System Capable of Sustaining Human Life”
Jonathan Taylor
Hate Trump? You Should Have Voted for Ron Paul
Franklin Lamb
Another Small Step for Syrian Refugee Children in Beirut’s “Aleppo Park”
Ron Jacobs
The Realist: Irreverence Was Their Only Sacred Cow
Andre Vltchek
Lock up England in Jail or an Insane Asylum!
Rev. William Alberts
Grandiose Marketing of Spirituality
Paul DeRienzo
Three Years Since the Kitty Litter Disaster at Waste Isolation Pilot Plant
Eric Sommer
Organize Workers Immigrant Defense Committees!
Steve Cooper
A Progressive Agenda
David Swanson
100 Years of Using War to Try to End All War
Andrew Stewart
The 4CHAN Presidency: A Media Critique of the Alt-Right
Edward Leer
Tripping USA: The Chair
Randy Shields
Tom Regan: The Life of the Animal Rights Party
Nyla Ali Khan
One Certain Effect of Instability in Kashmir is the Erosion of Freedom of Expression and Regional Integration
Rob Hager
The Only Fake News That Probably Threw the Election to Trump was not Russian 
Mike Garrity
Why Should We Pay Billionaires to Destroy Our Public Lands? 
Mark Dickman
The Prophet: Deutscher’s Trotsky
Christopher Brauchli
The Politics of the Toilet Police
Ezra Kronfeld
Joe Manchin: a Senate Republicrat to Dispute and Challenge
Clancy Sigal
The Nazis Called It a “Rafle”
Louis Proyect
Socialism Betrayed? Inside the Ukrainian Holodomor
Charles R. Larson
Review: Timothy B. Tyson’s “The Blood of Emmett Till”
David Yearsley
Founding Father of American Song
FacebookTwitterGoogle+RedditEmail