Sales of Canadian-sourced prescription drugs are booming inFlorida as seniors are crunching the numbers of Medicare-subsidizeddrugs.

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What these seniors have found, reports Kaiser Health News, isthat even with Medicare’s drug subsidies, the foreign brands areoften much cheaper.

How can that be? Kaiser says Medicare no longer offers thesavings that earlier crops of seniors enjoyed with the insurer.Instead, modeling itself after private insurance companies,Medicare has raised co-pays and performed other tricks ofcost-shifting to customers. In the process, by creating a demandfor cheaper drugs, it created an industry of retailers that sellmany drugs for less than a Medicare co-pay.

Read: Prescription drug prices doubled since2006

As reported by Kaiser, most of these retailers sprang up inFlorida, home to many American seniors — and to regulators willingto look the other way. While still only a tiny industry of perhapsfewer than 20 stores, current conditions may be converging to fuelan expansion.

The feds claim the shops are illegal, mainly because some of thedrugs haven’t passed the stringent U.S. review system. But, saysKaiser, Florida regulators aren’t pursuing enforcement of retailerssuch as Canadian MedStore, which now boasts six shops and claims tohave a customer base of nearly 1,000, most of them seniors.

Canadian drugs are especially in demand because Canada strictlycontrols pharmaceutical prices, a practice not followed by theUnited States. Thus the same basic drug produced in Canada and theUnited States can sell for 60 percent to 70 percent less at theFlorida stores, Kaiser says.

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Right now, the customer base is sparse. A 2011 study cited byKaiswer says about 5 million Americans get their drugs from foreignsources, just a 2 percent slice of the entire population. ACanadian nonprofit estimates about 1 million Americans buyCanadian-sourced drugs.

But the little industry has been steadily growing, survivingMedicare’s decision a decade ago to cover the cost of prescriptiondrugs, driven by the upward thrust of drug prices in the UnitedStates and the trend to shift costs to customers.

And even though the retail outlets are far from full service,their prospects are bright. As the over 65 population expands withbaby boomer buyers and U.S. pharmaceutical firms and insurerscontinue to drive up consumer costs, the word is getting around thesenior circuit that these pharmacy speakeasies can save them bigbucks on their chronic condition medications.