Medicare, Led by California Doctors, Wastes Billions on Brand-Name Drugs

Thursday, November 21, 2013

The competition was stiff, and drawn from medical offices across the nation, but in the end Dr. Hew Wah Quon of Los Angeles persevered and won. No one in the country wrote more Medicare prescriptions—$27 million worth—between 2009 and 2011, earning him a special place of note in a ProPublica study of abusive practices that cost the country hundreds of millions of dollars a year.

ProPublica looked at the prescribing habits of 1.6 million practitioners and zeroed in on 913 who tacked on $300 million to the nation’s medical bill in 2011 alone by writing scripts for brand-name drugs when much cheaper generic alternatives would have been suitable.

Nearly half of the 913 accepted promotional or consulting fees from drug companies of at least $1,000 since 2009, while 11 collected more than $100,000. Dr. Quon received $7,000. Dr. Quon’s specialty is prescribing brand-name drugs for cholesterol. AstraZeneca’s Crestor, for instance, costs $6 a pill, compared to 20 cents for legitimate generics.

ProPublica calculated that taxpayers would have saved $5 million if the doctor prescribed drugs that matched the national cost average. Dr. Quon wrote almost 80,000 prescriptions in 2011. He ranked No. 1 among prescribers of a dozen different brand name drugs and was second-highest for 13 others.

Dr. Jerry Avorn, a Harvard medical professor, was impressed. He told ProPublica, “Boy, this doctor is a walking economic disaster.”

Medicare’s giant drug program is generally considered a success, providing reasonably priced medicine to 36 million senior citizens and disabled people at costs below initial government projections. One out of every four prescriptions written in this country go through Medicare and last year, taxpayers spent $62 billion on Part D. One-third of that went to the low-income subsidy.

But its shortcomings were exacerbated by passage of the Medicare Part D program under the Bush Jr. administration. Part D, which took effect in 2006, allows low-income patients to pay just $7 for any prescription regardless of its cost.

“The unintended consequence is that doctors can dole out name brands with little fear of pushback from patients about price,” ProPublica reported.

Unlike health programs run by the military, the Department of Veterans Affairs and many private health insurance plans, there are no limits to the brand-name drugs that can be prescribed in Medicare.

The Los Angeles Daily News crunched through the federal numbers used by ProPublica and found that California doctors prescribed more name-brand drugs in 2011 than any other state. Part D claims that year totalled $7.5 billion for 65 million claims. A fifth of those prescriptions were for brand names.

Four California doctors accounted for 252,924 Medicare D prescriptions at a cost of $25 million. Overall, California internal medicine specialists prescribed brand-name drugs 23% of the time in 2011, just a bit over the national average. Dr. Quon’s patients received them 75% of the time. The average cost of his drug prescriptions was $129, just shy of double the state average.  

–Ken Broder


To Learn More:  

Medicare’s Failure to Track Doctors Wastes Billions on Name-Brand Drugs (by Charles Ornstein, Tracy Weber and Jennifer LaFleur, ProPublica)

California Doctors Lead Nation in Prescribing Brand-Name Drugs (by Susan Abram, Los Angeles Daily News)

Prescribers with Questionable Patterns in Medicate Part D (Department of Health and Human Services Office of Inspector General) (pdf)

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