Pharmaceuticals and medicare managed care: pharmacoeconomic considerations

Abstract

This supplement includes papers from a conference titled Pharmaceuticals and Medicare Managed Care: Pharmacoeconomic Considerations, held January 19-21, 1998, in Tucson, Arizona. The topic was selected because of the rapidly expanding enrollment of Medicare beneficiaries in managed care plans and the fact that the majority of these plans provide an outpatient prescription drug benefit. Although data indicating large disparities in satisfaction levels with Medicare health maintenance organizations (HMOs) are emerging, 1 the number of enrollees has increased by more than 100% since 1993, with 5 million individuals enrolled as of February 1997. 2 The implications of this shift for managed care organizations and the pharmaceutical industry have not been adequately explored. Enrollment in managed care plans by Medicare beneficiaries has been attractive partly because of the expanded services provided. In addition to the basic Medicare services, most of the managed care plans enrolling Medicare patients also provide some level of coverage for prescription drugs and preventive health services such as eye exams, routine physicals, and immunizations. Coverage for outpatient prescription drugs is especially appealing given that a majority of these costs are paid out of pocket by Medicare beneficiaries) It has been estimated that approximately 80% of HMOs with Medicare contracts offer outpatient prescription drug coverage and that most plans offering drug coverage use copayments, closed formulades, and/or annual dollar limits, or caps, to manage benefit costs. 4 However, prescription drug benefits for Medicare beneficiades are being eliminated or significantly reduced by some HMO plans. 5 Given that Medicare recipients account for a disproportionate share of total pharmaceutical expenditures, cost-effective prescription drug use in this population is essential. Questions being asked include: What are the procedures, programs, and policies that could be implemented to ensure access to and promote the appropriate use of prescription drugs by Medicare beneficiaries? How can the prescription