Medicare Releases 2013 Part D Drug Spending Data

Prescription drug spending from Medicare Part D is now available as the U.S. Government released data for claims in 2013. The government spent nearly $104 million on drugs under the program which covers approximately 36 million elderly and disabled individuals.

The data details spending on nearly 3,500 drugs during the year. The government spent $2.53 billion on Nexium, a heartburn treatment, in the top drug expenditure. Advair Diskus was in second place in total cost, with government spending of $2.26 billion.

The data is available on the Medicare website here.

After a brief glimpse at the data, it looks like the government’s release of information could eventually put a damper on Defendant’s use of Rule 9(b) in Rule 12(b)(6) motions to dismiss in False Claims Act litigation. Rule 9(b) requires plaintiffs to plead fraud with particularity. Courts have held that it applies to litigation under the False Claims Act, although the level of specificity required varies in different appellate courts. Following the release of this information, a relator may still not have individual patient level data but they do now have proof of Part D spending on prescriptions written by certain doctors. The question is whether that would be sufficient for the whistleblower to overcome the objection in their particular case.

The prescription drug data released is a substantial improvement over the information previously available, but still limited in some respects. The Part D data released covers about 78% of total costs and 87% of total drug claims in Part D, excluding from the information physicians with 10 or fewer drug claims. The information release also doesn’t give a complete picture of all money spent by Medicare on prescription drugs. It fails to account for medicines received in a hospital or doctor’s office as these are not billed to the Part D program.

This isn’t the only news coverage that the government’s drug spending has received this week. An OIG report recommended Congress and Centers for Medicare & Medicaid Services pursue additional rebates from companies for prescription drugs. The report found that Medicaid received rebates of 47% of their expenditures while Medicare received a rebate of only 15% of their spending. The cost after rebates on 110 brand name drugs for Medicaid was less than half of that paid by Medicare Part D.

Following the report, Senator Bill Nelson introduced the Medicare Drug Savings Act of 2015 into the U.S. Senate. The bill would require pharmaceutical manufacturers to offer the same rebates in Medicare as they do to Medicaid.

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