Factors Associated with Prescriptions for Branded Medications in the Medicare Part D Program

Abstract

Importance: Branded products of multisource drugs are frequently dispensed in the Medicare Part D program, increasing costs for the program and patients. Objective: To examine the reasons for dispensing branded multisource drugs in Medicare Part D. Design, Setting, and Participants: This cross-sectional study examined claims for multisource drugs with more than 1000 branded claims dispensed in Medicare Part D using Medicare Prescription Drug Event data from a 2017 nationwide random sample of 20% of Medicare beneficiaries. Data were analyzed between January and October 2020. Exposures: Justification for branded dispensing as indicated by each claim's dispense-as-written code. Main Outcomes and Measures: Mean Medicare Part D program spending and patient out-of-pocket spending for branded and generic products, and generic vs branded spending discounts in program and patient out-of-pocket spending for each multisource drug. Results: Among 169 million claims for 224 multisource drugs, 8.3 million claims (4.9%) were dispensed with a branded product. Among these claims, 4.9 million claims (59.2%) did not have a recorded reason for branded dispensing; 1.4 million claims (16.9%) occurred because of prescriber requests; and 1.1 million claims (13.5%) occurred because of patient requests. If all branded dispensing requested by prescribers had been substituted by the corresponding generics, the projected savings to the Medicare Part D program and Medicare patients were $997 million (56.0%) and $161 million (64.4%), respectively. If all branded dispensing requested by patients had been substituted by generics, the projected savings to the Medicare Part D program and Medicare patient were $673 million (53.4%) and $109 million (55.1%), respectively. Drugs with the highest proportion of branded dispensing by physician or patient request were typically high cost (eg, drugs with above-median frequencies of branded dispensing: mean [SD] discount on generic vs branded, 73.9% [26.9%] for prescriber requests). Conclusions and Relevance: Prescribers and patients motivated 30.4% of all branded dispensing of multisource drugs in the Medicare Part D program. Branded dispensing requested by prescribers or patients incurred an incremental annual cost of $1.67 billion to the Medicare program and $270 million to patients when compared with switching to generics. Policy makers should consider ways to discourage prescribers and patients from requesting branded dispensing of multisource drugs because of the higher cost..