Study addresses impact of Medicare Part D on medical spending

After enrolling in Medicare Part D, seniors who previously had limited or no drug coverage spent more on prescriptions and less on other medical care services such as hospitalizations and visits to the doctor's office, according to a University of Pittsburgh Graduate School of Public Health study. Published in the July 2 issue of the New England Journal of Medicine, the study also found that seniors who had relatively good drug benefits prior to enrolling in Medicare Part D spent somewhat more on prescriptions and, at the same time, increased their spending on other medical care services.

"We found that Part D led to increases in overall pharmacy spending among all beneficiaries," said the study's lead author, Yuting Zhang, Ph.D., assistant professor of health economics at the University of Pittsburgh Graduate School of Public Health. "These increases were offset by decreases in spending on other medical care services in those with little or no drug coverage before they enrolled in Medicare Part D, which was one-third of the beneficiary population studied. The majority of Part D enrollees in our study population―those with relatively good prior prescription coverage--spent more on prescriptions as well as other medical services."

The purpose of Medicare Part D, which took effect in January 2006, is to subsidize the cost of prescription drugs for Medicare beneficiaries, more than 30 percent of whom had limited or no coverage for prescription drugs prior to its implementation.

Dr. Zhang and her colleagues compared prescription drug use and other medical spending among three groups of senior citizens two years before and after Part D was implemented. The groups included beneficiaries with no prior drug coverage, poor prior drug coverage ($600 maximum per year) and relatively good prior drug coverage ($1,400 maximum per year, comparable to Part D). They found that total monthly prescription drug spending increased by 74 percent among the no-coverage group; by
27 percent among the poor-coverage group; and by 11 percent among the good-coverage group. The study also found that the use of both lipid-lowering and anti-diabetic medications rose in the groups with limited or no drug coverage.

When it came to spending on other medical care services excluding drugs, the no-coverage group and poor-coverage group decreased their spending by $33 and $46 per month respectively, while the good-coverage group increased their spending by $30 per month.

"The offset in spending by seniors with limited or no prior drug benefits could be due to improved adherence to medication, especially for those with chronic conditions. Improved access to prescription drugs provided by Part D may enable this population to better control symptoms and cut down on visits to the physician's office or emergency room," said Dr. Zhang. On the other hand, the lack of a similar spending offset in the good-coverage group could indicate an overuse of some medications and services by this population, she noted.

Source: University of Pittsburgh

   

• Nan2 - Jul 02, 2009
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  Medicare part D needs revision with the rest of the so called health care system. Medicare requires supplemental insurance as it covers less and less, the out of pocket expenses for common health care needs have increased at stunning levels year over year for the elderly and disabled.
  
  The current maze and confusion in supplemental coverage leads to abuses of both individuals and government. This is borne out in case after case. WellCare in the SE recently was suspended from offering supplemental coverage as they 1) overcharged the government 2) overcharged individuals 3)denied payment for critical generic drugs like standard heart medications.
  
  WellCare sold supplemental insurance hawking it as a simple solution in this gigantic maze of health care provision. The complicated system of billing makes fraud and abuse of both the patient, institutions and government easy targets.
  
  Insurers have overstepped their roles and failed to provide its core business. They dictate care of patient by denial of services, cost and/or denial of particular Rx medications, some of which do not have suitable generic substitutes. How is it that a personal physician's education, experience and assessment of an INDIVIDUAL can be over-ridden by an insurer who never lays eyes or hands on a person? INSURANCE is a service but not a PROVIDER of the service-increasingly they are inserting themselves into this process. PPO/HMOs are a gigantic failure.
  
  Countless hours are lost in the process of providing care to patients in determining what insurance will pay, doctors and nurses serving as advocates for their patients sometimes with success but increasingly not successful.
  
  The current trend is for large mainstream providers of health care insurance to drop clients should they become critically ill or chronically ill. This is a breech of contract-many of these people paid into the so called insurers for decades only to be abandoned when they needed services-leading to bankruptcy and worse in the collateral damage necessary for profitability.
  
  This is why insurers must be taken out of the equation as they provide little in the way of cost effectiveness to the system overall-they are simply overlord middlemen who want their cut and in the process have cut out well over 50 million people. They rule on fear, they should not be included anymore as insurers have had it all their way and failed.
  
  Standardization of billing would provide a gigantic cost savings annually and rid the system of the never ending paperwork, submission of precerts, etc, etc. that take too much time and effort in attempt to provide standard care to patients. Billing agents outnumber hands on providers in hospitals-this must be reversed. People who think QA is meta analysis need to follow patients from admission to discharge and beyond to discover the problems. Lack of staffing, time for care is the PROBLEM. Nice clean computer modeling/data analysis won't reveal this. Seems there are too many in health care afraid to get their hands dirty or look a patient in the eye.
  
  Co-opting insurers will only produce more abuses, they have proved themselves unworthy of the trust. The cart is before the horse again. Individuals are the victims in this system-not overuse of services. This is an easy way to account for double digit-year over year increases in health care and cost of insurance. The real reason is near monopolistic suppliers of pharmaceuticals, medical equipment to hospitals, supplies that make triple-digit profits on gauze. This is a captured market system, not a competitive or free one. Its led into that all too predictable method of assuring a product will be utilized-old boy methods that are unsustainable and abusive without some sane margins.
  
  Time to get real and look at the OTHER reasons health care spiraled out of control which hasn't been described, golfing buddies get the lions share of public opinion making, lets hear some other voices because these have mold on them and its tough to swallow it.
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