Seniors Paying More for Drugs Under Part D Than Other Plans

Senior citizens with chronic illness were more likely to receive prescription drug coverage through the Medicare Part D program, which began at the start of 2006, than through other options, but that program was likely to cost them significantly more than other coverage, according to a recent survey.

The results of the survey, conducted in fall 2006 by the Kaiser Family Foundation, Commonwealth Fund, and Tufts-New England Medical Center, were published in the August Health Affairs.

The survey included a national, random sample of more than 16,000 seniors and looked at their out-of-pocket spending and cost-related experiences, broken out by type of drug coverage, with a more in-depth look at the experiences of seniors with low incomes.

The survey found that a larger share of seniors in Part D than those in employer-sponsored or VA insurance programs spent more than $300 monthly, despite taking a similar or smaller number of medications. Part D enrollees were twice as likely to spend at least $300 monthly as seniors with employer-sponsored coverage, and they were three times as likely to do so as were VA beneficiaries.

The differing impact of drug costs on chronically ill enrollees was even more pronounced than among Medicare beneficiaries in general. Among seniors with multiple chronic illnesses, Part D enrollees took the same number of medications as others, on average, but spent “significantly more out of pocket” with significantly higher rates of cost-related nonadherence. The survey found that 11 percent of chronically ill Part D enrollees, 8 percent in employer plans, and 7 percent in the VA spent more than $300 monthly on prescriptions.

The survey results also indicated that older Americans enrolled in a Medicare Part D plan had more medication-access problems than those who relied on other sources of drug coverage, such as employer-sponsored coverage or benefits from the VA.

Part D enrollees decided against or delayed filling or refilling prescriptions at twice the rate of seniors who got their prescription coverage through employer plans or the VA. Part D enrollees were more than twice as likely as seniors in employer plans to delay or avoid filling or refilling prescriptions because of cost, which the researchers called“ cost-related nonadherence.”

The study authors said that more research is needed to clarify the reason for the higher spending by Part D beneficiaries, but they said it was likely attributable, in part, to the coverage gap that exposes Part D enrollees to 100 percent cost sharing after their total spending exceeds a certain threshold. The so-called “donut hole” coverage gaps are rare in employer-sponsored plans and are not a feature of VA benefits.

“We still have a lot of work to do to make sure that Medicare beneficiaries—particularly those who are most vulnerable because of low incomes or chronic illness—can get the drugs they need and are not subject to burdensome out-of-pocket costs,” said Karen Davis, president of the Commonwealth Fund, in a written statement.