Ugh. That is sickening. Since it seems like you have some expertise in the area, is this antipattern actually codified In regulations, or more of a de-facto/status quo thing?
A lot of drug purchasing things are codified. For example, Medicare is banned from negotiating drug pricing with manufactures. So even though they're buying billions of dollars worth of drugs in bulk, they're literally paying the retail price, which is just whatever the Pharma companies ask for.
In terms of why they're buying the branded version in the first place, not entirely sure what the exact situation is right now. I'm sure someone will write a great article on it in a few years though after all the money has already been siphoned off.
Probably doesn't take a psychic to see its because the brand bought the right politicians at the right time.
For injected drugs, Medicare pays no more than the average price that private insurers pay. They basically piggy back on the deals. If you look at heavily discounted drugs, Medicare is paying no where close to list price.
For peals, Medicare doesn't negotiate because they buy them. Private insurers adjudicate all claims and they certainly do negotiate drug prices. Those lower prices get passed to consumers who purchase their plans.
And this doesn't even include the 340B discount which is mandatory.
Medicare doesn't negotiate, it creates laws that lower it's drug costs.
Where can I read more about this? I've heard the exact opposite.