Medicare Is Overpaying For Generics, Says JAMA Study

Could Have Saved $2.6bn In 2018 Buying 184 Generics At Costco Prices

A study published in the Journal of the American Medical Association has found that while Medicare coverage of generic drugs likely improves patient adherence and reduces other health care utilization, inefficiencies stemming from its “complex and opaque system of intermediaries” mean that it has overpaid on most prescription generics compared to retailer Costco. 

Costco
Costco largely bypasses Medicare’s complex and opaque system of intermediaries • Source: Shutterstock

Medicare is overspending on prescription generics in comparison to US retailer Costco, due to inefficiencies stemming from its “complex and opaque system of intermediaries” that are largely bypassed by the retailer, according to a study published in the Journal of the American Medical Association.

The research compared the amount Medicare pays for common generic prescriptions in Part D with prices available to patients without...

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