September 2007 

The Top Five Outpatient Prescription 

Drugs Ranked by Total Expense for 

Medicare Beneficiaries, by Insurance 

Status, 2004

Marie N. Stagnitti, MPA

Introduction 

This Statistical Brief provides information on the top five outpatient 

prescription medicines ranked by total expenditures and insurance 

status for the Medicare population, as reported by households in the 

U.S. civilian noninstitutionalized (community) population in calendar

year 2004. The brief also provides information on average total payments and average out-of-pocket payments per purchase for the top 

five drugs for Medicare beneficiaries, by insurance status. 

The estimates in this brief are derived from the Household Component of the 2004 Medical Expenditure Panel Survey (MEPS-HC). 

Only prescribed medicines purchases in an outpatient setting are 

included in the estimates. Insulin and diabetic supplies and equipment are included in MEPS prescribed medicines estimates. Overthe-counter medicines are excluded from these estimates as are 

prescription medicines administered in an inpatient setting or in a 

clinic or physician’s office. All differences discussed in the text are 

statistically significant at the 0.05 percent level. 

Findings 

In 2004, the top five household-reported prescribed medicines when

ranked by annual expenditures for Medicare beneficiaries with any

private insurance included the following: 

2004 MEPS-HC Prescribed Medicines: 

Top five prescribed medicines ranked by total expenditures 

for the Medicare and any private insurance population 

Rank Prescribed

medicine

name

Total

dollars 

(in billions) 

Average 

price per 

drug 

purchase

Average outof-pocket 

payment per 

drug purchase

1 Lipitor $2.61 $106.35 $56.76

2 Zocor $1.62 $121.52 $60.89

3 Plavix $1.02 $127.16 $60.19

4 Norvasc $.89 $70.54 $35.21

5 Nexium $.85 $139.73 $87.93

Medical Expenditure Panel Survey Agency for Healthcare 

Research and Quality

STATISTICAL BRIEF #186 

Highlights 

 In 2004, when ranked by total

expenditures, Lipitor ranked first 

in all three insurance categories 

for the Medicare population: 

Medicare and any private insurance ($2.6 billion), Medicare 

and public insurance only ($1.1 

billion), and Medicare only ($.98 

billion). 

 When ranked by total expenditures in 2004, three drugs 

(Lipitor, Zocor and Plavix) made 

the top five rankings for all three 

insurance categories for the 

Medicare population. 

 Among the three drugs that 

made the top five in each of the 

Medicare population insurance 

categories (Lipitor, Zocor, and 

Plavix), the average out-ofpocket payment for Plavix was

higher for those with Medicare

only ($88.93) than those with 

Medicare and any private insurance ($60.19) and those with 

Medicare and public insurance 

only ($19.41), for those with at

least one drug purchase. 

 Among the three drugs that 

made the top five in each of the 

Medicare population insurance 

categories, the average out-ofpocket payment for Zocor was

higher for those with Medicare

only ($70.86) than those with 

Medicare and public insurance 

only ($37.82), and the average 

out-of-pocket payment for Lipitor was higher for those with 

Medicare only ($78.45) than 

those with Medicare and private 

insurance ($56.76), for those 

with at least one drug purchase. 

 Zyprexa, an atypical antipsychotic, made the top five ranking for only one Medicare 

population status insurance 

category in 2004—Medicare

and public insurance only, 

ranking second at $.46 billion. 
In 2004, two cholesterol-reducing medicines ranked first and second in terms of total expenditures for the 

Medicare and any private insurance population: Lipitor was first with $2.61 billion and Zocor was second 

with $1.62 billion. Plavix, an antiplatelet drug ranked third at $1.02 billion, and Norvasc, a calcium channel 

blocker, ranked fourth at $.89 billion. Rounding out the top five was Nexium, a proton pump inhibitor, with 

$.85 billion. The combined expenditures for the top five drugs totaled $6.99 billion and accounted for 16.2 

percent of the $43.06 billion total drug expenditures for Medicare beneficiaries with any private insurance. 

Norvasc had the lowest average total payment per drug purchase ($70.54) as compared with the other 

drugs ranked in the top five for Medicare beneficiaries with any private insurance in 2004. In addition, the 

average total payment per purchase for Lipitor ($106.35) was lower than the average total payment per 

purchase for Zocor ($121.52), Plavix ($127.16), and Nexium ($139.73). 

Norvasc had the lowest average out-of-pocket payment per drug purchase ($35.21) as compared with the 

other drugs ranked in the top five for Medicare beneficiaries with any private insurance in 2004. In 

addition, Nexium had a higher out-of-pocket payment ($87.93) than Zocor ($60.89) and Plavix ($60.19). 

In 2004, the top five household-reported prescribed medicines when ranked by annual expenditures for 

Medicare beneficiaries with additional public insurance only included the following: 

2004 MEPS-HC Prescribed Medicines: 

Top five prescribed medicines ranked by total expenditures 

for the Medicare and public insurance only population

Rank Prescribed 

medicine 

name 

Total 

dollars 

(in billions) 

Average 

price per 

drug 

purchase

Average outof-pocket 

payment per 

drug purchase

1 Lipitor $1.10 $114.50 $43.17 

2 Zyprexa $.46 $240.81 $18.98 

3 Prevacid $.44 $139.71 $15.02 

4 Plavix $.40 $123.81 $19.41 

5 Zocor $.40 $122.14 $37.82 

In 2004, two cholesterol-reducing medicines ranked first and fifth in terms of total expenditures for the 

Medicare and public only insurance population: Lipitor was first with $1.10 billion and Zocor was fifth with 

$.40 billion. Ranking second was Zyprexa, an atypical antipsychotic, with $.46 billion. Prevacid, a proton 

pump inhibitor, ranked third with $.44 billion and Plavix, an antiplatelet drug, ranked fourth at $.40 billion. 

The combined expenditures for the top five drugs totaled $2.80 billion and accounted for 15.6 percent of 

the $17.91 billion total drug expenditures for Medicare beneficiaries with additional public insurance only. 

The average total payment per purchase for Zyprexa ($240.81) was higher than the average total 

payment for Lipitor ($114.50), Plavix ($123.81), and Zocor ($122.14) for Medicare beneficiaries with 

additional public insurance only in 2004. In addition, Prevacid ($139.71) had a higher average total 

payment than Plavix ($123.81). 

In 2004, the top five household-reported prescribed medicines when ranked by annual expenditures for 

Medicare beneficiaries with Medicare only included the following: 

2004 MEPS-HC Prescribed Medicines: 

Top five prescribed medicines ranked by total expenditures 

for the Medicare only population

Rank Prescribed 

medicine 

name 

Total 

dollars 

(in 

billions) 

Average 

price per 

drug 

purchase

Average outof-pocket 

payment per 

drug purchase

1 Lipitor $.98 $97.75 $78.45 

2 Nexium $.58 $201.68 $185.41 

3 Zocor $.54 $107.65 $70.86 

4 Plavix $.47 $116.36 $88.93 

5 Norvasc $.42 $67.76 $57.69 
In 2004, two cholesterol-reducing medicines ranked first and third in terms of total expenditures for the

Medicare only population: Lipitor was first with $.98 billion and Zocor was third with $.54 billion. Nexium, a

proton pump inhibitor, ranked second with $.58 billion. Rounding out the top five was Plavix, an

antiplatelet drug, which ranked fourth at $.47 billion and Norvasc, a calcium channel blocker, which

ranked fifth with $.42 billion. The combined expenditures for the top five drugs totaled $2.99 billion and

accounted for 14.2 percent of the $21.00 billion total drug expenditures for the Medicare population with

Medicare only.

The average total payment per purchase for Nexium ($201.68) was higher than the average total

payment for any other drug in the top five for the Medicare population with Medicare only in 2004. The

lowest total average payment was for Norvasc at $67.76.

During 2004, the average out-of-pocket payment per purchase was highest for Nexium ($185.41) for the

Medicare population with Medicare only. In addition, Norvasc had a lower average out-of-pocket payment

per purchase ($57.69) than Lipitor ($78.45) and Plavix ($88.93).

Comparisons of average total payment per purchase and average out-of-pocket payment per purchase

for drugs making the top five in one or more insurance status category

When comparing the three insurance status groups for the Medicare population in 2004, three drugs were

common to all three: Lipitor, Zocor, and Plavix. For Lipitor, there was no significant difference in the

average total payment per purchase when compared by insurance status. However, when looking at the

average out-of-pocket payment per purchase for Lipitor, those with Medicare only had a higher average

out-of-pocket payment ($78.45) than those with Medicare and any private insurance ($56.76).

For Zocor, when comparing by insurance status for Medicare beneficiaries, there were no statistically

significant differences in the average total payment per purchase in 2004. However, when comparing the

average out-of-pocket payment per purchase for Zocor by insurance status for Medicare beneficiaries,

those with Medicare only had a higher average out-of-pocket payment ($70.86) than those with Medicare

and any additional public insurance ($37.82).

In 2004, for Plavix, there were no statistically significant differences in the average total payment per

purchase when comparing Medicare beneficiaries by insurance status. However, when comparing the

average out-of-pocket payment per purchase by insurance status, those with Medicare only had a higher

average out-of-pocket payment for Plavix ($88.93) than those with Medicare and any private insurance

($60.19) and those with Medicare and public insurance only ($19.41). Moreover, the average out-ofpocket payment for Plavix was higher for those with Medicare and any private insurance than those with

Medicare and public insurance only.

Two prescribed drugs (Nexium and Norvasc) were common to the top five rankings for Medicare

beneficiaries with Medicare only and those with Medicare and any private insurance. For both Nexium

and Norvasc, there was no statistically significant difference in the average total payment per drug

purchase when comparing the two insurance groups. However, for both drugs, the average total out-ofpocket payment per purchase was higher for those with Medicare only (Nexium, $185.41; Norvasc,

$57.69) than those with Medicare and any private insurance (Nexium, $87.93; Norvasc, $35.21).

Definitions/Methodology

Medicare population

The Medicare population was defined as those reporting Medicare coverage at any time in 2004.

Health insurance status

Respondents were asked about health insurance coverage for themselves and all household members at

each round of interviewing. The insurance variables reflect supplemental coverage, in addition to

Medicare, that beneficiaries had for hospital and physician services. Persons categorized as having

supplemental insurance coverage may or may not have coverage for prescription drugs. The insurance

categories are mutually exclusive and hierarchical. Persons with more than one type of supplemental

coverage were placed into an insurance category in the following order:

– Medicare and private insurance: This category includes persons classified as Medicare beneficiaries

and covered by Medicare and a supplementary private policy.

– Medicare and other public insurance: This category includes persons classified as Medicare

beneficiaries who met both of the following criteria: 1) they were not covered by private insurance at
any point during the year, and 2) they were covered by one of the following public programs at any 

point during the year: Medicaid, other public hospital/physician coverage. 

– Medicare only: This category includes persons classified as Medicare beneficiaries but not classified as 

Medicare and private insurance or as Medicare and other public insurance. This group includes 

persons who were enrolled in Medicare HMOs and persons who had Medicare fee-for-service coverage 

only. 

Out-of-pocket payments 

The out-of-pocket category includes payments by user or family. 

Expenditure rankings 

Expenditure rankings are based on drug name. Generic and brand name drugs with the same active 

ingredient are not combined into one category. 

About MEPS-HC 

MEPS-HC is a nationally representative longitudinal survey that collects detailed information on health 

care utilization and expenditures, health insurance, and health status, as well as a wide variety of social, 

demographic, and economic characteristics for the civilian noninstitutionalized population. It is 

cosponsored by the Agency for Healthcare Research and Quality and the National Center for Health 

Statistics. 

For more information about MEPS, call the MEPS information coordinator at AHRQ (301-427-1406) or 

visit the MEPS Web site at http://www.meps.ahrq.gov/. 

References 

For a detailed description of the MEPS survey design, sample design, and methods used to minimize 

sources of nonsampling error, sees the following publications: 

Cohen, J. Design and Methods of the Medical Expenditure Panel Survey Household Component. MEPS 

Methodology Report No. 1. AHCPR Pub. No. 97-0026. Rockville, Md.: Agency for Health Care Policy and 

Research, 1997. 

Cohen, S. Sample Design of the 1996 Medical Expenditure Panel Survey Household Component. MEPS 

Methodology Report No. 2. AHCPR Pub. No. 97-0027. Rockville, Md.: Agency for Health Care Policy and 

Research, 1997. 

Cohen, S. Design Strategies and Innovations in the Medical Expenditure Panel Survey. Medical Care,

July 2003: 41(7) Supplement: III-5–III-12. 

Suggested Citation 

Stagnitti, M. N. The Top Five Outpatient Prescription Drugs Ranked by Total Expense for Medicare 

Beneficiaries, by Insurance Status, 2004. Statistical Brief #186. September 2007. Agency for Healthcare 

Research and Quality, Rockville, Md. http://www.meps.ahrq.gov/mepsweb/data_files/publications/ 

st186/stat186.pdf

∗ ∗ ∗

AHRQ welcomes questions and comments from readers of this publication who are interested in 

obtaining more information about access, cost, use, financing, and quality of health care in the United 

States. We also invite you to tell us how you are using this Statistical Brief and other MEPS data and 

tools and to share suggestions on how MEPS products might be enhanced to further meet your needs. 

Please e-mail us at mepsprojectdirector@ahrq.hhs.gov or send a letter to the address below: 

Steven B. Cohen, PhD, Director 

Center for Financing, Access, and Cost Trends 

Agency for Healthcare Research and Quality 

540 Gaither Road 

Rockville, MD 20850