Dale Lehman writes:

I’ve been trying to understand the large changes being made to Medicare Part D drug plan coverage and prices. Due to recent changes, Part D actually looks more like an insurance plan than it used to – there is a $2000 cap on out-of-pocket spending for all Part D plans (there used to be no limit) and a fairly high deductible, so it is sort of a catastrophic coverage plan. I can now get a plan with $0 monthly premiums, but due to my income I pay around $700/year to subsidize poorer participants. I was trying to find data to see whether this makes financial sense for myself – how common are drugs that cost more than $2000 per year? So, I investigated what data is available. CMS provides data (sample dataset attached) for each drug: https://data.cms.gov/summary-statistics-on-use-and-payments/medicare-medicaid-spending-by-drug/medicare-part-d-spending-by-drug. However, the drug cost data is gross drug costs:

Drug spending metrics for Part D drugs are based on the gross drug cost, which represents total spending for the prescription claim, including Medicare, plan, and beneficiary payments. The Part D spending metrics do not reflect any manufacturers’ rebates or other price concessions as CMS is prohibited from publicly disclosing such information.

This makes the data completely irrelevant! It is clearly measures of net costs that matter, but only gross costs (analogous to sticker prices) are provided. Similar issues arise with recent requirements for hospital price transparency. The data required for intelligent consumer decisions – or meaningful analysis of health policies is simply not available. Mass amounts of data are provided, but much of it is simply meaningless. I’m sure some researchers get access to relevant data, either through their connections or buy purchasing private data. But (too) much government data is not available in any form that permits independent analysis. This permits regulation and legislation to proceed under heavy influence from special interests, along with publication records for the limited few with privileged access. We (I) bemoan researchers not releasing their data – here we have cases where the raw government data that matters is “prohibited from publicly disclosing such information.”

He supplies this example:

The generic drug Tamsulosin, a favorite of mine (and many older men), shows almost 477,000 beneficiaries in 2022 (I said it is a favorite). Average spending per beneficiary is $75/year. When I fill my prescriptions, the price is $0. The brand name version (Flomax) still shows 990 beneficiaries, with an average spending of $1996/year. That drug manufacturer (Sanofi-Aventis) must be making a fortune – or discounting the drug greatly. Or are the small number of prescribers using the brand name drug getting huge kickbacks, financed by Medicare? Or did the insurer strike deals with the other 15 manufacturers of the drug, and what type of deals did they strike? Anybody trying to make sense out of how the actual part D drug plans work is left without any useful data. None of these numbers are meaningful, other than the total number of people on these drugs.