Medicare paid unnecessary billions on branded drugs

Medicare might have saved billions had it simply prescribed older generic drugs, according to a new study from the Annal of Internal Medicine. CMS chose instead to pay for newer, brand-name drugs rather than its chemically similar, off-brand counterparts — ultimately paying $17.7 billion more.

For example: Medicare paid $13.4 billion for the Nexium acid reflux pill, when it could have saved $12.7 billion if patients used Prilosec, instead. Nexium’s chemistry is a mirror image of Prilosec, and works in the same manner.

“It should have been a no-brainer to substitute these generics, because Medicare and patients would have saved billions,” one of the researchers, Dr. Joseph Ross, a professor of medicine and public health at Yale University, told STAT’s Ed Silverman.