Medicare part D and changes in prescription drug use and cost burden: national estimates for the Medicare population, 2000 to 2007

Abstract

Context: The full effect of Medicare Part D, after the initial policy transition period and across the United States Medicare population, remains unclear.

Objective: To estimate nationally representative changes in prescription drug use and out-of-pocket drug costs 2 years after implementation of Part D.

Design, setting, and participants: We examined study outcomes over 8 years (2000 to 2007) and estimated changes after Part D, accounting for earlier trends. Our analyses used the community-dwelling sample of the Medicare Current Beneficiary Survey (unweighted unique n=38,798). Actual post-Part D outcomes were compared with projected values using 2000 to 2005 data. Subgroup analyses and standardization weights were used to address population-level shifts over time in health status and demographic characteristics.

Main outcome measures: Annual prescription drug fills and out-of-pocket drug costs.

Results: We observed significant average per person increases of 1.8 prescription fills [95% confidence interval (CI), 1.1-2.5] in 2006 and 3.4 prescription fills (95% CI, 2.7-4.1) in 2007 above pre-Part D increases of 0.9 prescription fills per year. Average out-of-pocket drug costs decreased significantly by $143 (95% CI, -182.5--103.1) in 2006 and $148 (95% CI, -181.2--114.1) in 2007 above average pre-Part D increases of $12 per year. Prescription fills did not change for beneficiaries with fair to poor health until 2007 when large increases occurred (increases of 3.7 to 11.0 fills above pre-Part D trends). Significant reductions in OOP drug costs occurred in 2006 and persisted into 2007 across all groups except for sick and poor beneficiaries without Medicaid.

Conclusions: After the transition year of 2006, the impact of Part D seemed larger and more consistent across the Medicare population. Of note, sick and poor beneficiaries experienced significant improvements in prescription drug use in 2007.

Figure 1. Unadjusted Averages for Annual Prescription Drug Use and Out-of-Pocket Drug Costs Among Community-Dwelling Medicare Beneficiaries Overall, 2000–2007

Estimates weighted to national Medicare population. Total number ranged from 36.6 to 39.7 million. Error bars represent 95% confidence intervals around means.

Figure 2

Figure 2A. Absolute Differences between Observed and Predicted Average Annual Prescription Drug Fills among Medicare Subgroups based on Demographic Characteristics, according to Self-reported Health Status For Excellent to Good Health, all differences are significant at p<.05 except Rural in 2006 and 2007, and 1–2 morbidities in 2006. For Fair to Poor Health, no differences are significant at p<.05 in 2006 except Elderly, White/nonHispanic, Rural, Medicaid, 201–300FPL, and >=3morbidities. In 2007, all differences are significant except 301+%FPL. Figure 2B. Absolute Differences between Observed and Predicted Average Annual Out-of-Pocket Drug Costs among Medicare Subgroups, according to Self-reported Health Status For Excellent to Good Health, all differences are significant at p<.05. For Fair to Poor Health, all differences are significant at p<.05 except 0–100% FPL in 2006 and 2007.

Figure 3. Changes in Average Annual Prescription Drug Use and Out-of-pocket Costs among 3-year Cohorts of Medicare Beneficiaries, 2005–2007

Unweighted numbers for 3-year panels are: Had no drug coverage 2005–2007 (n=103), Gained drug coverage in 2006 or 2007 (n=395), Maintained drug coverage 2005–2007 (n=2513); Error bars represent 95% confidence intervals around means.