What Difference Do Generics Make?
Generic drugs account for about 78 percent for drugs dispensed in retail settings, such as independent, chain, and mail-order pharmacies, as well as in long-term care facilitates. According to a GAO report:
[A] series of studies estimated that … substituting generic drugs for their brand-name counterparts … from 1999 through 2010 … saved more than $1 trillion. A second group of studies estimated the … the potential for additional savings within the Medicare Part D program—which provides outpatient prescription drug coverage for Medicare—and found that if generic drugs had always been substituted for the brand-name drugs studied, about $900 million would have been saved in 2007. A third group of studies estimated the effect on health care costs of using generic versions of certain types of drugs where questions had generally been raised about whether substituting generic drugs for brand-name drugs was medically appropriate. Unlike the other two groups which focused on savings on drugs only, these studies compared savings from the lower cost of generic drugs to other health care costs that could accrue from their use, such as increased hospitalizations. The studies had mixed results regarding the effect of using these generics in that some found they raised health care costs, while others found they led to cost savings.
People often tout the VA Health System’s drug benefit as being super-efficient because it has the legal authority to negotiate drug prices with manufacturers. But the way it actually holds down drug spending is by restricting its drug formulary to (mostly) generic drugs.
Interesting.
If they are the same compunds, whats the difference? I’ve been told for years by my doctors that brand name and generic drugs are exactly the same.
It’s the third group of studies that worry me.
Ditto Tom.