Medicare is wasting hundreds of millions of dollars a year by failing to rein in doctors who routinely give patients pricey name-brand drugs when cheaper generic alternatives are available.
ProPublica analyzed the prescribing habits of 1.6 million practitioners nationwide and found that a tiny fraction of them are having an outsized impact on spending in Medicare's massive drug program.
Just 913 internists, family medicine and general practice physicians cost taxpayers an extra $300 million in 2011 alone by disproportionately choosing name-brand drugs. These doctors wrote at least 5,000 prescriptions that year, including refills, and ranked among the program's most prolific prescribers.
Many of these physicians also have accepted thousands of dollars in promotional or consulting fees from drug companies, records show.
While lawmakers bitterly disagree about the Affordable Care Act, Medicare's drug program has been held up as a success for government health care. It has come in below cost estimates while providing access to needed medicines for 36 million seniors and the disabled.
But this seeming fiscal success has hidden billions of dollars lost to unnecessarily expensive prescribing over the program's eight-year history.
See more about prescription drugsHow prescriber checkup can help patients
The waste is exacerbated by a well-meaning benefit written into the drug program, known as Part D: Low-income patients pay less than $7 per prescription regardless of a medication's cost. The unintended consequence is that doctors can dole out name brands without fear of pushback from patients about price.
Taxpayers spent $62 billion last year on Part D -- more than a third of it on this low-income subsidy, sometimes called Extra Help.
Dr. Hew WahQuon is one of Medicare's top prescribers. From a worn office in Los Angeles' bustling Chinatown, he churned out $27 million worth of prescriptions from 2009 to 2011, data show.
All Quon's patients in 2011 qualified for the low-income subsidy. He mostly prescribed name brands, such as AstraZeneca's Crestor, for high cholesterol. Crestor costs more than $6 a pill; the leading generic costs as little as 20 cents.
If Quon had prescribed the way other internists in California do, choosing drugs so his average cost was similar, he alone would have saved Medicare $5 million, ProPublica's analysis shows.
"Boy, this doctor is a walking economic disaster," said Dr. Jerry Avorn, a Harvard medical professor and expert on prescription drugs.
When first contacted by ProPublica last year, Quon defended some of his choices but abruptly ended the interview and has since declined to comment.
Others who prescribe similarly said they believe name-brand drugs do a better job. But numerous studies show that generics, which must meet rigid Food and Drug Administration standards, work just as well for most patients.
Health programs run by the U.S. military and the Department of Veterans Affairs control costs by strictly limiting the name-brand drugs doctors can prescribe. Some of the nation's leading private health plans do as well.
Medicare, which pays for one in every four prescriptions nationwide, hasn't asked Congress for the authority to put similar checks in place.
The Centers for Medicare and Medicaid Services, which administers Medicare, declined to make an official available for an interview and would not answer specific questions.
"By law, Medicare must cover items and services that are reasonable and necessary," a CMS spokesperson said in an email. "Within those rules, doctors and their patients are free to make medical treatment decisions that are best for the patient."
In the past, agency officials have said that while Part D is a government program, private insurers are responsible for running it. They normally decide how to manage their drug plans but cannot increase prices for the poor.
Some say Medicare should establish penalties and bonuses to encourage more cost-effective habits.
"I just don't see how that's different from holding them accountable for the quality of care in the exam room or in the operating room," said Dr. Nancy Morden, an associate professor at the Dartmouth Institute for Health Policy and Clinical Practice, which has studied Part D.King Of The Name Brands
Quon's unassuming office, just outside downtown Los Angeles, is wedged between a bank and a budget hotel. In 2011, some 80,000 prescriptions flowed from here and his other office nearby in Monterey Park.
Quon, 62, was the nation's top prescriber that year for a dozen name-brand drugs and second-highest for another 13.
Crestor was high on his list -- he prescribed it 5,250 times, more than double any other doctor in Part D. Doctors typically find that generics such as simvastatin work well to treat the risks from artery-clogging cholesterol.
Quon also liked Lovaza, a purified and concentrated fish oil.
The drug is marketed by GlaxoSmithKline to treat very high triglycerides, fats in the blood linked to heart disease. At more than $90 per prescription in 2011, Lovaza'sprice dwarfed over-the-counter fish oils that sold for a few dollars a bottle.
Quon prescribed Lovaza 4,700 times, tops in the country.
Dr. Steven Nissen, chairman of cardiovascular medicine at the Cleveland Clinic, said it is "absolutely inconceivable" to treat so many patients "with a drug approved only to treat a relatively rare disorder."