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Medicare Part D payments for neurologist-prescribed drugs

Objective: To describe neurologists' Medicare Part D prescribing patterns and the potential effect of generic substitutions and price negotiation, which is currently prohibited. Methods: The 2013 Medicare Part D Prescriber Public Use and Summary files were used. Payments for medications were aggregated by provider and drug (brand or generic). Payment, proportion of generic claims or day's supply, and median payment per monthly supply of medication were calculated by physician specialty and drug. Savings from generic substitution were estimated for brand drugs with a generic available. Medicare prices were compared to drug prices negotiated by the federal government with pharmaceutical manufacturers for the Veterans Administration (VA). Results: Neurologists comprised 13,060 (1.2%) providers with $5.0 billion (4.8%) in total payments, third highest of all specialties, with a median monthly payment of $141 (interquartile range $85–225). Multiple sclerosis drugs had the highest payments ($1.8 billion). Within neurologic disease groups ($3.4 billion in payments), 54.2%–91.8% of monthly supplies were generic, but 11.9%–71.3% of the payment was for generic medications. Generic substitution resulted in a $269 million (6.5%) payment decrease. VA pricing resulted in $1.5 billion (44.5% of $3.4 billion) in savings. Conclusions: High payment per monthly supply of medication underlies the high total neurology drug payments and is driven by multiple sclerosis drugs. Lowering drug expenditures by Medicare should focus on drug prices.