Share Of Seniors With Drug Coverage Significantly Increased Under Medicare Part D, Some Seniors Still Vulnerable To High Costs, Study Finds

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Seniors / Aging
Article Date: 23 Aug 2007 - 16:00 PDT

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The Medicare prescription drug benefit has significantly increased the share of seniors with drug coverage, but one in five beneficiaries reported delaying or not filling prescriptions because of cost, according to the results of a survey published online Tuesday in the journal Health Affairs, the Los Angeles Times reports. The survey -- conducted in October 2006 by the Kaiser Family Foundation, the Commonwealth Fund and Tufts-New England Medical Center -- included more than 16,000 seniors (Alonso-Zaldivar, Los Angeles Times, 8/21).

According to the study, the percentage of seniors without prescription drug coverage dropped from 33% in 2005 before the benefit took effect to 8% in 2006 (Ross, Cox/Longview News-Journal, 8/21). Overall, about half of all seniors were enrolled in the drug benefit at the time of the survey, 31% received drug benefits from a former employer and 3% were covered through the Department of Veterans Affairs. The survey found that about one-quarter of seniors enrolled in the Medicare drug benefit said they had switched to lower-cost generic drugs, and more were using mail-ordering programs for 90-day supplies of drugs at a lower cost.

Twenty percent of Medicare drug plan beneficiaries said they did not fill or delayed filling a prescription because of cost, compared with 23% of those without drug coverage, 8% of those with employer-based benefits and 12% of seniors with coverage through the VA (Los Angeles Times, 8/21). About one in four Medicare drug plan beneficiaries said they spent more than $100 in out-of-pocket drug costs per month, and 8% said they spent more than $300 per month, according to the survey. This compares with 11% of those without drug coverage and 5% of VA beneficiaries and those enrolled in employer-sponsored plans who said they spent more than $300 per month, the survey found (Cox/Longview News-Journal, 8/21).

According to the Times, some of the higher costs for Medicare drug plan beneficiaries appear to be because of the so-called "doughnut hole" coverage gap, under which beneficiaries are responsible for 100% of total prescription drug costs between $2,400 and $5,450 (Los Angeles Times, 8/21). Other studies estimate that 3.4 million to 4.7 million beneficiaries are eligible for but do not receive low-income subsidies that would close the coverage gap. The survey found that about half of low-income seniors not receiving these subsidies were aware of their availability (Cox/Longview News-Journal, 8/21).

Comments
Lead study author Tricia Neuman, vice president of the Kaiser Family Foundation and director of the Foundation's Medicare Policy Project, said, "I was somewhat surprised to see the disparities between [Medicare] plans, and employer and VA coverage. When you control for health status, income and other differences, the strong finding that employer plans provide better coverage than Medicare comes through loud and clear" (Los Angeles Times, 8/21). According to Neuman, "Low-income subsidies really make a difference for those seniors who receive them, but there are still millions of low-income seniors who are eligible for this help but are not getting it. Our study confirms the importance of doing more to get additional assistance to low-income seniors" (Cox/Longview News-Journal, 8/21).

Kaiser Family Foundation President and CEO Drew Altman said, "The Medicare drug law achieved its primary goal of providing drug coverage to most seniors who previously lacked it," adding, "But the survey found a significant number of seniors in Part D plans paying sizable amounts out of pocket for their medications and delaying or not filling their prescriptions for cost reasons."

Commonwealth Fund President Karen Davis said, "In addition to covering more seniors, it's important that coverage be adequate to ensure financial protection and access to prescription drugs," said, adding, "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."

Rep. Pete Stark (D-Calif.) said the drug benefit is "a system basically designed to create profits for private insurance plans. I don't want to see it repealed, but I want to see it repaired." CMS officials had no comment on the report (Los Angeles Times, 8/21).

Free access to the study is available online.

"Reprinted with permission from http://www.kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at http://www.kaisernetwork.org/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation . © 2005 Advisory Board Company and Kaiser Family Foundation. All rights reserved.