How did Medicare spend $3B on extra drugs? A report links early refills and mail-order policies to waste and safety risks.
A new report has found that Medicare spent nearly $3 billion on unnecessary prescription drugs between 2021 and 2023, largely due to excessive and early refills that resulted in beneficiaries receiving medications they did not need.
The findings, first reported by The Wall Street Journal (1✔ ✔Trusted Source
America’s Seniors Are Overmedicated
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), reveal that relaxed refill policies introduced during the COVID-19 pandemic — combined with automatic mail-order pharmacy programs — led to widespread over-dispensing of prescription drugs, creating both financial waste and potential safety risks for patients.TOP INSIGHT
New #Medicare data reveals a startling trend: 1 in 6 seniors enrolled in the Medicare drug benefit are prescribed 8 or more #medications at the same time.
As #polypharmacy rises, the focus shifts to medication safety, potential #druginteractions, and the need for regular prescription reviews.
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Pandemic-era Rules Fuel Excess Refills
During the pandemic, regulators eased restrictions on early prescription refills to ensure patients would not run out of essential medications while access to in-person care was limited. Mail-order pharmacies expanded rapidly during this period, offering automatic refills and 90-day supplies for many drugs.
While these changes improved access and convenience, the report found they also led to unintended consequences. Between 2021 and 2023, mail-order pharmacies accounted for only 9% of Medicare prescriptions but were responsible for 37% of excess refills, according to the analysis.
Many beneficiaries received medications earlier than medically necessary or in quantities exceeding their needs, with Medicare covering the cost under existing reimbursement rules.
Safety and Cost Concerns
Experts warn that excess medication poses risks beyond financial waste. Taking unnecessary or duplicate medications can increase the likelihood of dosing errors, adverse drug interactions, and accidental overdoses, particularly among older adults.
Kevin Thompson, CEO of 9i Capital Group and host of the 9innings podcast, told Newsweek that the problem extends beyond inefficiency.
“During the pandemic, refill rules were relaxed to prevent patients from running out of medication,” Thompson said. “Those policies lingered, and when combined with automatic and mail-order refill programs, many Medicare beneficiaries began receiving prescriptions earlier and in greater quantities than needed.”
He added that because prescriptions were processed and billed under existing rules, Medicare paid for them even when the additional supply was unnecessary.
Financial Impact on Medicare
Medicare spends more than $100 billion annually on prescription drug benefits, making even small inefficiencies costly at scale. The report highlighted one example in which more than 200,000 extra 30-day supplies of the diabetes drug Jardiance were dispensed over the three-year period, costing taxpayers an estimated $111 million.
The structure of mail-order pharmacy operations also drew scrutiny. Many of the largest mail-order pharmacies are owned by major insurers, including UnitedHealth Group, Humana, and Aetna, creating financial incentives to dispense higher volumes of medications.
Critics argue that because pharmacies earn revenue from each prescription filled, the system can unintentionally encourage oversupply, even when patient need is limited.
Industry Response
Insurance providers say policies have evolved since the period reviewed in the analysis. A spokesperson for UnitedHealth said the company blocked up to five times more early refills in 2024 compared with 2021 and 2022, reflecting tighter oversight.
Humana also defended its current approach, stating that its protocols “strike the right balance, allowing sufficient time to fill and ship prescriptions while supporting medication adherence without encouraging stockpiling.”
Industry representatives emphasize that preventing gaps in medication access remains a priority, especially for patients managing chronic conditions.
Experts Call for Balance and Oversight
Alex Beene, a financial literacy instructor at the University of Tennessee at Martin, said the issue highlights the need for moderation rather than blame.
“No one is criticizing Medicare recipients for seeking early refills on medications they rely on,” Beene told Newsweek. “But excessive refills lead to unused pills sitting in homes and contribute to billions in unnecessary Medicare spending.”
He added that better oversight could protect both patients and taxpayers. “There has to be a better balance — one that allows people to manage their health responsibly while reducing waste in the system.”
What Happens Next
The Wall Street Journal investigation has renewed scrutiny of Medicare’s refill policies and the role of automatic prescription programs. While insurers say reforms are already underway, analysts expect closer regulatory oversight and potential policy adjustments aimed at limiting unnecessary refills without disrupting patient care.
As Medicare continues to face rising prescription drug costs, policymakers and healthcare providers alike are under pressure to ensure that convenience-driven systems do not come at the expense of safety, efficiency, or public funds.
Reference:
- America’s Seniors Are Overmedicated – (https://www.wsj.com/health/healthcare/americas-seniors-are-overmedicated-f397bb1d?)
Source-Medindia