Life Science Compliance Update

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December 15, 2016

Updated Medicare and Medicaid Drug Spending Data Released

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On November 15, 2016, the Centers for Medicare and Medicaid Services (CMS) released updated Medicare and Medicaid drug spending data, to include information for calendar year (CY) 2015 through its online interactive dashboards for Medicare and Medicaid. The inclusion of the Medicaid drug spending data on the public dashboard is new this year, as is the addition of high-level (aggregated) Medicare drug rebate data.

CMS noted that “there is significant growth in spending on prescription drugs, representing a significant burden.” In CY 2015, total prescription drug costs amounted to roughly $457 billion – an estimated 16.7 percent of personal health care spending. “This is up from $367 billion, or 15.4 percent of personal health care spending in 2012. With annual growth expected to average 6.7 percent annually for 2025, [CMS] expect[s] increasing costs to continue to put pressure on families and programs that cover prescription drugs.”

The dashboard provides spending, utilization, and other trend data for the drugs chosen to be included in the dashboards. CMS selected drugs for inclusion that met the following criteria: (1) drugs with high spending on a per user basis (Medicare) and drugs with high spending on a per prescription fill basis (Medicaid); (2) drugs with high total program spending; and (3) drugs with high costs increases in recent years.

Medicare

CMS identified a total of eighty drugs for inclusion on the dashboard: 40 Part D drugs, and 40 Part B drugs. Even though eighty is a “relatively small set of medications,” their overall inclusion on the dashboard “represents a very large proportion of program spending, including 34 percent of all Part D spending and 69 percent of Part B drug spending in 2015, which was similar to the 2014 drug dashboard.” The dashboard also includes aggregated Part D manufacturer rebate information for CY 2014, with CY 2015 data to be incorporated once available.

The Part D drugs with the highest total spending in CY 2015 were: Spiriva, Advair Diskus, Crestor, Lantus/Lantus Solostar, and Harvoni. Spiriva, Lantus, and Harvoni are new additions to the CY 2015 list, as compared to CY 2014. (See below chart).

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The Part B drugs with the highest total spending in CY 2015 were: Lucentis, Remicade, Neulasta, Rituxan, and Eylea. This is the same group of five drugs with the highest Part B spending in CY 2014. (See below chart).

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Medicaid

For the Medicaid dashboard, CMS identified 70 drugs for inclusion on the dashboard (roughly 41 percent of Medicaid covered outpatient drug spending in 2015).

The drugs with the highest total Medicaid spending in CY 2015 were: Abilify, Harvoni, Humira/Humira Pen, Lantus/Lantus Solostar, and Vyvanse. The below chart shows trends in Medicaid total spending for the top five drugs in 2015.

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CMS also went a step further, highlighting the top five drugs with the largest increases in average cost per unit from CY 2014 to CY 2015. Ativan had the largest increase in cost per unit at 1,264 percent and a spending increase from $1.7 million to $5.3 million. All five of the below drugs, as shown below, had increases in cost per unit of more than 400 percent.

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