The effect of Medicare Part D on drug and medical spending.
BACKGROUND
It is not known what effect the increased use of prescription drugs by enrollees in Medicare Part D has had on spending for other medical care.


METHODS
We compared spending for prescription drugs and other medical care 2 years before the implementation of Part D in January 2006 with such expenditures 2 years after the program's implementation in four groups of elderly beneficiaries: Medicare Advantage enrollees with stable, uncapped, employer-based drug coverage throughout the study period (no-cap group), those who had no previous drug coverage, and those who had previous limited benefits (with either a $150 or a $350 quarterly cap) before they were covered by Part D in 2006.


RESULTS
Between December 2005 and December 2007, as compared with the increase in the no-cap group, the increase in total monthly drug spending was $41 higher (95% confidence interval [CI], $33 to $50) (74%) among enrollees with no previous drug coverage, $27 higher (95% CI, $20 to $34) (27%) among those with a previous $150 quarterly cap, and $13 higher (95% CI, $8 to $18) (11%) among those with a previous $350 cap. The use of both lipid-lowering and antidiabetic medications rose in the groups with no or minimal previous drug coverage. As compared with expenditures in the no-cap group, monthly medical expenditures (excluding drugs) were $33 lower (95% CI, $29 to $37) in the group with no previous coverage and $46 lower (95% CI, $29 to $63) in the group with a previous $150 quarterly cap, whereas medical spending was $30 higher (95% CI, $25 to $36) in the group with a previous $350 cap.


CONCLUSIONS
Enrollment in Medicare Part D was associated with increased spending on prescription drugs. Groups that had no or minimal drug coverage before the implementation of Part D had reductions in other medical spending that approximately offset the increased spending on drugs, but medical spending increased in the group that had more generous previous coverage.
Zhang
Yuting
Y
Department of Health Policy and Management, Graduate School of Public Health, University of Pittsburgh, PA 15261, USA.
Donohue
Julie M
JM
Lave
Judith R
JR
O'Donnell
Gerald
G
Newhouse
Joseph P
JP
D000368:Aged; D000369:Aged, 80 and over; D003920:Diabetes Mellitus / Q000188:drug therapy; D004363:Drug Utilization / Q000191:economics / Q000706:statistics & numerical data; D005102:Health Expenditures / Q000706:statistics & numerical data*; D006801:Humans; D006949:Hyperlipidemias / Q000188:drug therapy; D007004:Hypoglycemic Agents / Q000191:economics / Q000627:therapeutic use; D000960:Hypolipidemic Agents / Q000191:economics / Q000627:therapeutic use; D019458:Insurance Coverage / Q000191:economics*; D054524:Medicare Part D / Q000191:economics*; D055553:Prescription Drugs / Q000191:economics*; D014481:United States
D007004:Hypoglycemic Agents; D000960:Hypolipidemic Agents; D055553:Prescription Drugs