Although the Medicare prescription drug program got off to a rocky start a few years ago, the results have been positive with out-of-pocket spending decreasing for prescriptions among seniors, according to a new study. In 2006, the program’s first year, a 16 percent drop in out-of-pocket spending for prescription drugs among seniors was attributed to the Medicare Part D program, according to RAND, a nonprofit research organization. Also, there was a 7 percent increase in the number of prescriptions filled.

 

“In the beginning there was a lot of concern about Medicare Part D, but we found convincing evidence that it has exceeded expectations and generally has been successful,” says study lead author Geoffrey Joyce, a senior economist at RAND. “Most seniors now have prescription drug coverage that allows them to buy drugs at a reasonable cost.”

 

The savings appears to have been concentrated among the poor and disabled, the report, appearing in the American Journal of Managed Care, says.

 

“It appears that Medicare Part D has been particularly successful in lowering costs for the poor and the disabled, which is an important finding since initially there was concern these groups would be particularly vulnerable under a privately administered benefit,” Joyce says.

 

The RAND researchers used administrative records to examine seniors’ participation in the Medicare Part D program, including how the program has affected seniors’ access to medications, their use of prescription drugs, and their financial risk. They also compared the 10 largest Part D plans in 2006 to seven non-Medicare drug plans often cited as examples of low-cost or generous pharmacy benefits. After two years, about 90 percent of seniors have drug coverage as good or better that the standard Part D benefit. Medicare recipients in most states could choose from more than 50 different Part D plans in 2008, a sign of competition among the private companies that provide the coverage.

 

The number of drugs covered in the 10 largest Medicare Part D plans was comparable with the coverage provided by other prescription drug plans that insure seniors, the report shows. Among the 300 prescription drugs most often used by seniors, about half were covered under the lowest co-payment tiers provided by the 10 largest Medicare Part D plans. The number of drugs not covered varied from four to 41 among the largest Part D plans.

 

In contrast, other drug plans from Kaiser Permanente and the Veterans Administration excluded 75 and 84 medications, respectively.

 

But, the survey says, because of spending caps, 3 million seniors go without coverage for a portion of the year. In 2007, about 20 percent of seniors stopped their medications after their coverage lapsed for the year.