Over the last nine months, we have sliced and diced generic drug pricing within Medicaid managed care programs to arrive at the conclusion that generic prices in Medicaid are subject to wild and seemingly arbitrary distortions.
But the million dollar (or should we say, $2 billion dollar) question is whether this problem is isolated to Medicaid, or if it is a broader issue plaguing Medicare Part D and commercial plans as well? We now attempt to bring data into the fold to help answer this question.
In our latest report, we embark on an in-depth investigation into the pricing of the top 15 generic drugs in Medicare Part D - drugs that represented roughly a third of overall Part D generic spending in 2017.
It turns out that the same arbitrary generic pricing behavior we have observed in Medicaid is alive and well within Part D, and some of the drug markups are massive. If you make it all the way to the end of the report, you will be rewarded with all the math that estimates this problem to be worth over $2 billion in 2017.