A new Avalere analysis reveals that more than half of people with Medicare Part D paid the full cost of their generic drugs at least one time in 2020, in some cases as much as they would pay for brand-name drugs. Sarai Radriguez reports for Health Payer Intelligence on the increasing number of people with Medicare Part D who pay the full cost of their generic drugs.
In the three years between 2017 and 2020, the percent of people with Medicare getting no help from their Part D prescription drug coverage to pay for their generic drugs in at least one instance rose from 45 percent to 63 percent. Their copays were in the same tier as brand-name drugs.
Drugs for which people paid the full cost included drugs to treat thyroid issues as well as musculoskeletal, cardiotonic, thyroid issues and anxiety. Curiously, a higher percentage of people in low-income subsidy benchmark plans (Extra Help plans) (68 percent) paid the full price of their generics than people in non-benchmark plans (62 percent).
Medicare Part D plans cannot charge their enrollees more for copays than their negotiated price for a drug. But, they can put generic drugs on high copay tiers, while getting higher discounts for brand-name drugs. So, that’s what they are doing increasingly to maximize their profits. As a result, some brand-name drugs cost enrollees less out of pocket than their generic substitutes during the catastrophic coverage phase of the Part D benefit, even though they cost Medicare more.
If the skinny version of Build Back Better passes–the reconciliation bill–it would allow federal drug price negotiation for some brand-name drugs without generic substitutes. But, it does nothing to ensure that Part D prescription drug insurers are offering their enrollees coverage at the lowest price possible, for example, at the prices you can get through Mark Cuban’s Cost Plus Pharmacy.
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