How the Medicare Part D drug benefit changed the distribution of out-of-pocket pharmacy spending among older beneficiaries.
OBJECTIVE
To examine the impact of the Medicare drug benefit (Part D) on the distribution of out-of-pocket pharmacy spending among older adults.


METHODS
We used a pre-post-with-comparison-group design to compare four groups of beneficiaries continuously enrolled in a Medicare Advantage plan between 2004 and 2007: three intervention groups with no or limited (quarterly caps of $150 or $350) prior coverage that obtained Part D benefits in 2006 and a comparison group with stable drug coverage from 2004 to 2007.


RESULTS
The comparison group's out-of-pocket drug spending was stable throughout 2004-2007, whereas Part D reduced out-of-pocket spending 13.4% among those without prior coverage (95% confidence interval [CI] -17.1% to -9.1%) and 15.9% among those with $150 quarterly caps (95% CI -19.1% to -12.8%) relative to the comparison group. Individuals in the top decile of drug spending paid a greater share of their costs out-of-pocket than others in the top 5 deciles.


CONCLUSIONS
Although Part D reduced out-of-pocket expenditures for older adults, those with the highest drug spending still pay a substantial share of their drug costs out-of-pocket. Thus, the Part D benefit does not achieve a primary purpose of insurance-to offer the greatest financial protection to those at the highest risk.
Zhang
Yuting
Y
Department of Health Policy & Management, University of Pittsburgh, Pittsburgh, Pennsylvania 15261, USA. ytzhang@pitt.edu
Lave
Judith R
JR
Newhouse
Joseph P
JP
Donohue
Julie M
JM
D000367:Age Factors; D000368:Aged / Q000706:statistics & numerical data; D000369:Aged, 80 and over; D016001:Confidence Intervals; D005252:Fees, Pharmaceutical / Q000706:statistics & numerical data*; D005260:Female; D006801:Humans; D008297:Male; D054524:Medicare Part D / Q000191:economics*; D017063:Outcome Assessment, Health Care; D010414:Pennsylvania / Q000453:epidemiology; D012737:Sex Factors; D014481:United States / Q000453:epidemiology