Prescription Drug Insurance Research Articles

Supplemental Material for Enrollment in Prescription Drug Insurance: The Interaction of Numeracy and Choice Set Size

Supplemental Material for Enrollment in Prescription Drug Insurance: The Interaction of Numeracy and Choice Set Size

Evolving Choice Inconsistencies in Choice of Prescription Drug Insurance

We study choice over prescription insurance plans by the elderly using government administrative data to evaluate how these choices evolve over time. We find large "foregone savings" from not choosing the lowest cost plan that has grown over time. We develop a structural framework to decompose the changes in "foregone welfare" from inconsistent choices into choice set changes and choice function changes from a fixed choice set. We find that foregone welfare increases over time due primarily to changes in plan characteristics such as premiums and out-of-pocket costs; we estimate little learning at either the individual or cohort level.

Temporal Trends in Genital Warts Among Individuals Covered by the Public Prescription Drug Insurance Plan in the Province of Quebec, Canada, From 1998 to 2007

We assessed temporal trend in the incidence and prevalence of genital warts (GWs) in the province of Quebec, Canada, between 1998 and 2007 as a baseline for future assessment of the impact of Quebec human papillomavirus vaccination program. Data on GWs were obtained from the linkage of the physician service claims and the public insurance drug plan databases. Genital warts were identified through a prescription of podofilox, a medical procedure code specific to GWs or a diagnosis code for viral warts followed by a prescription of imiquimod or fluorouracil within 2 weeks. An episode was considered incident if it was preceded by a 12-month interval period free of GWs care. During the study period, a total of 27,138 episodes of GWs occurred among 24,267 individuals. The age-standardized incidence rate increased over time in men and women. The highest incidence was observed in women aged 20 to 24 years (391.9/100,000) and in men aged 25 to 29 years (383.3/100,000). Similar trends in prevalence were observed. The incidence and prevalence of GWs has increased among the population covered by the public insurance drug plan in Quebec.

How does complementary private prescription drug insurance coverage affect seniors’ use of publicly funded medications?

BackgroundLike in many other high-income jurisdictions, the public drug program in Ontario, Canada provides comprehensive coverage of prescription drugs to the 65 years and older population with some cost sharing. The objective of this study was to examine the marginal impact of holding private drug coverage on the use of publicly funded medicines among the senior population in Ontario. MethodsWe drew on linked survey and administrative data sources to examine the impact of private drug coverage first on total spending and utilization of medications, and second, on clinically recommended medications for individuals with a diagnosis of diabetes. ResultsApproximately 27% of Ontario seniors reported having private prescription drug insurance from a current or prior employer. The population-level analysis of all seniors found that individuals with private insurance coverage, on average, took about a quarter of an additional drug and incurred 16% more in costs to the public program in a year compared to those without additional coverage. The disease-specific analysis of seniors with a diagnosis of diabetes found that private coverage was associated with two-fold higher odds of taking an anti-hypertensive drug, but it had no association with the use of statins or anti-diabetic medications. DiscussionThe results of this study provide some evidence that seniors in Ontario are sensitive to the price of drugs. These findings raise equity concerns relating to the cost sharing arrangements in the public system and our policy of allowing private plans to “top-up” the public plan.

Are prescription drug insurance choices consistent with expected utility theory?

To determine the extent to which people make choices inconsistent with expected utility theory when choosing among prescription drug insurance plans and whether tabular or graphical presentation format influences the consistency of their choices. Members of an Internet-enabled panel chose between two Medicare prescription drug plans. The "low variance" plan required higher out-of-pocket payments for the drugs respondents usually took but lower out-of-pocket payments for the drugs they might need if they developed a new health condition than the "high variance" plan. The probability of a change in health varied within subjects and the presentation format (text vs. graphical) and the affective salience of the clinical condition (abstract vs. risk related to specific clinical condition) varied between subjects. Respondents were classified based on whether they consistently chose either the low or high variance plan. Logistic regression models were estimated to examine the relationship between decision outcomes and task characteristics. The majority of respondents consistently chose either the low or high variance plan, consistent with expected utility theory. Half of respondents consistently chose the low variance plan. Respondents were less likely to make discrepant choices when information was presented in graphical format. Many people, although not all, make choices consistent with expected utility theory when they have information on differences among plans in the variance of out-of-pocket spending. Medicare beneficiaries would benefit from information on the extent to which prescription drug plans provide risk protection.

Supplemental Material for Are Prescription Drug Insurance Choices Consistent With Expected Utility Theory?

Supplemental Material for Are Prescription Drug Insurance Choices Consistent With Expected Utility Theory?

Consumers' intention to use generic-drug discount programmes

Abstract Objective Generic-drug discount programmes (GDDPs) offer generic drugs at subsidized costs to both insured and uninsured consumers in the USA. Understanding predictors of intention to use GDDPs could help in developing interventions to direct more consumers to take advantage of such programmes. The objective of this study was to identify predictors of intention to use GDDPs using the theory of planned behaviour (TPB). Methods A paper-based survey was self-administered to randomly selected individuals from the greater Houston area in Texas, USA. The validated questionnaire included potential predictors of intention to use GDDPs that were derived and measured using the premise of TPB and the concept of awareness. Logistic regression was performed to evaluate if awareness, attitude towards GDDPs and generic drugs, perceived behavioural control (PBC) and subjective norms predicted intention to use GDDPs after controlling for demographics, income, number of chronic conditions and number of prescription drugs taken. Key findings A response rate of 59.5% was achieved (n = 663). Approximately 62.4% (414) respondents were aware of and 80% (528) had an intention to use GDDPs. After controlling for demographics and predisposing factors (current prescription drug use, chronic conditions and insurance status), attitude towards GDDPs (odds ratio, OR = 5.08; 95% confidence interval, CI = 3.228–8.003; P < 0.0001), attitude towards generic drugs (OR = 1.733; CI = 1.231–2.441; P = 0.0016) and PBC (OR = 1.57; CI = 1.067–2.320; P = 0.0222) significantly predicted intention to use GDDPs. Individuals of Hispanic and African American origin were 3.1 times (P = 0.0016) and 2.6 times (P = 0.0173) more likely, respectively, than white people to have an intention to use GDDPs. Conclusions Attitude towards GDDPs and generic drugs, PBC, location and race/ethnicity were significantly associated with intention to use GDDPs. Interventions by stakeholders to promote positive attitudes and highlighting the ease with which GDDPs can be used would be beneficial to eventually increase consumer utilization of GDDPs.

Sinking, Swimming, or Learning to Swim in Medicare Part D.

Under Medicare Part D, senior citizens choose prescription drug insurance offered by numerous private insurers. We examine nonpoor enrollees' actions in 2006 and 2007 using panel data. Our sample reduced overspending by $298 on average, with gains by 81 percent of them. The greatest improvements were by those who overspent most in 2006 and by those who switched plans. Decisions to switch depended on individuals' overspending in 2006 and on individual-specific effects of changes in their current plans. The oldest consumers and those initiating medications for Alzheimer's disease improved by more than average, suggesting that real-world institutions help overcome cognitive limitations.

Consumer Inertia and Firm Pricing in the Medicare Part D Prescription Drug Insurance Exchange

I use the Medicare Part D prescription drug insurance market to examine the dynamics of firm interaction with consumers on an insurance exchange. Enrollment data show that consumers face switching frictions leading to inertia in plan choice, and a regression discontinuity design indicates initial defaults have persistent effects. In the absence of commitment to future prices, theory predicts firms respond to inertia by raising prices on existing enrollees, while introducing cheaper alternative plans. The complete set of enrollment and price data from 2006 through 2010 confirms this prediction: older plans have approximately 10 percent higher premiums than comparable new plans. (JEL G22, I13, I18, L11, L65)

Medicare Part D and Its Effect on the Use of Prescription Drugs and Use of Other Health Care Services of the Elderly

AbstractWe examine the effect of gaining prescription drug insurance, as a result of Medicare Part D, on use of prescription drugs and other medical services for a nationally representative sample of Medicare beneficiaries. Given the heightened importance of prescription drugs for those with chronic illness, we provide separate estimates for elderly in poorer health. We find that Medicare Part D significantly reduced socioeconomic and geographic disparities in prescription drug insurance among the elderly. Gaining prescription drug insurance through Medicare Part D was associated with a 30 percent increase in the number of annual prescriptions and a 40 percent increase in expenditures on prescription drugs for both the general population of the elderly and the elderly in poorer health. We find little evidence that prescription drug insurance was strongly associated with the use of outpatient and inpatient services, although our investigation of these associations was limited by a lack of statistical power.

Case Managers and the Useof Medicare, Part D

The purpose of this study was to examine the experiences and opinions of community-based mental health case managers with the Medicare prescription drug benefit. A qualitative approach, consisting of analysis of data from 3 case manager focus groups, was used to achieve an understanding of the role that case managers played in beneficiaries' access to and use of prescription medicines. Two urban nonprofit community-based mental health agencies. Adults who are disabled by mental illness depend on case managers for information about their prescription drug insurance, help with formulary and plan switching information, and assistance with tasks related to medication adherence in the community. Common themes in the case managers' discussion were managing beneficiary problems, stress for beneficiaries, information and paperwork issues, and cynicism regarding health care reform. The critical role of case managers in the use of Medicare Part D is not well understood or appreciated. Case managers need to be informed about Medicare Part D and ready to advocate for their clients in the community. In addition, it is important for case managers to understand how Medicare Part D affects not only older adults, but also adults living with serious and persistent mental illness.

Medicare Part D and Quality of Prescription Medication Use in Older Adults

In 2006, the US Centers for Medicare and Medicaid Services implemented Medicare Part D to provide outpatient prescription drug insurance to disabled and older adults. In creating Part D, a key provision to address quality included medication therapy management (MTM) programmes designed to increase proper and safe use of medications among targeted Part D beneficiaries. A preponderance of evidence shows that Part D has increased medication affordability and accessibility; however, what remains less clear is whether it has improved the quality of medication use and optimized health outcomes. Now in its sixth year, Part D is undergoing its first major revision, with the gradual elimination of the coverage gap by 2020. Therefore, now is a good time to review the accumulated evidence on the impact of Part D and MTM programmes on the quality of medication use to help inform future policy decisions and research directions. In this review, we found that Part D's net effect on quality of medication use has mainly been positive. Cost-related medication nonadherence improved moderately and there were fewer than expected treatment interruptions. However, vulnerable subgroups, such as sicker and dual-eligible beneficiaries, experienced lags in improvement. Beneficiaries who entered the coverage gap consistently experienced interruptions and displayed worsening medication adherence after entering the gap, with generic-only gap drug coverage offering limited benefit. Such findings can serve as baseline information as the coverage gap phases out. Limited availability of data is the greatest barrier to research into Part D. Part D's overall effect on health outcomes and adverse medical events, such as hospitalizations, is inconclusive because of inadequate evidence to date. Similarly, no evaluation of quality of medication use is available with respect to utilization management strategies and MTM programmes delivered under Part D. Future research will need to further examine the added value of Part D and address whether Part D optimizes health outcomes in the Medicare population. As the current economic recession increases the pressure to cut costs, the effect of future spending restrictions, such as restrictions on coverage subsidies, will also be of special concern.

Self-reported responses to medication therapy management services for older adults: Analysis of a 5-year program

BackgroundMedication therapy management (MTM) services provide essential reviews of drug regimens and are increasingly recognized as beneficial to patient safety, improved health outcomes, and cost savings. ObjectiveTo assess patient behavioral outcomes from an MTM service, including actions following receipt of a pharmacist report. MethodsA retrospective analysis of an MTM program at the Sanford Center for Aging (NV, USA) was conducted. Outcome measures included whether the patient discussed the review with the physician, whether any changes in the client’s drug regimen occurred, and whether the client feels more knowledgeable about his or her medications. Predictor variables included basic demographics, prescription insurance status, number of prescriptions taken, self-reported health status, and use of medications considered to be high risk. The analysis plan involved the use of multivariate logistic regression models. ResultsThe odds of discussing the medication review with physicians, making changes recommended in the report, and both discussing and making a change were 65%, 60%, and 67%, respectively, lower among those below poverty level than among those above poverty level; 95% confidence intervals (CIs): 0.15, 0.80; 0.18, 0.85; and 0.15, 0.73, respectively. The odds of those using high-risk drugs of making changes in drug regimens, and of discussing with physicians and making changes together, were 2 times higher than the odds of those not using these drugs, 95% CIs: 1.02, 4.31 and 1.20, 4.87, respectively. The likelihood of those reporting good or excellent health of doing the combination of discussing the MTM report with physicians and to make a drug regimen change was 2 times greater than for those reporting poor to fair health, 95% CI: 1.08, 3.65. Gender, ethnicity, age group, rural status, prescription drug insurance, and high polypharmacy were not significant factors for acting on the medication review in the adjusted model. ConclusionMTM services are associated with enhanced patient self-advocacy, but like other interventions, they are constrained by social disparities. Greater attention to the resources of target populations to respond to pharmacy services is merited.

The impact of Medicare Part D on hospitalization rates.

To determine whether the change in prescription drug insurance coverage associated with Medicare Part D reduced hospitalization rates for conditions sensitive to drug adherence. Hospital discharge data from 2005 to 2007 for 23 states, linked with state-level data on drug coverage. We use a difference-in-difference-in-differences approach, comparing changes in the probability of hospitalization before and after the introduction of the Part D benefit in 2006, for individuals aged 65 and older (versus individuals aged 60-64) in states with low drug coverage in 2005 (versus those in states with high pre-Part D drug coverage). Hospitalization rates for selected ambulatory care sensitive conditions in 23 states were computed using data from the Census and Health Care Utilization Project. Drug coverage rates were computed using data from several sources. For the conditions studied, our point estimates suggest that Part D reduced the overall rate of hospitalization by 20.5 per 10,000 (4.1 percent), representing approximately 42,000 admissions, about half of the reduction in admissions over our study period. Conclusions. The increase in drug coverage associated with Medicare Part D had positive effects on the health of elderly Americans, which reduced use of nondrug health care resources.

Age and the purchase of prescription drug insurance by older adults.

The Medicare Part D Prescription Drug Program places an unprecedented degree of choice in the hands of older adults despite concerns over their ability to make effective decisions and desire to have extensive choice in this context. While previous research has compared older adults to younger adults along these dimensions, our study, in contrast, examines how likelihood to delay decision making and preferences for choice differ by age among older age cohorts. Our analysis is based on responses of older adults to a simulation of enrollment in Medicare Part D. We examine how age, numeracy, cognitive reflection, and the interaction between age and performance on these instruments are related to the decision to enroll in a Medicare prescription drug plan and preference for choice in this context. We find that numeracy and cognitive reflection are positively associated with enrollment likelihood and that they are more important determinants of enrollment than age. We also find that greater numeracy is associated with a lower willingness to pay for choice. Hence, our findings raise concern that older adults, and, in particular, those with poorer numerical processing skills, may need extra support in enrolling in the program: they are less likely to enroll than those with stronger numerical processing skills, even though they show greater willingness to pay for choice.

The economics of choice: lessons from the U.S. health-care market.

The English health-care system is moving towards increasing consumers' choice. Following economic thinking, it is assumed that such a policy will improve quality, enhance patient satisfaction and reduce health disparities. Indeed, the English health-care system has already built the necessary infrastructure to increase patients' choice. Before expanding the range of choices further, however, it is important that policy makers be aware of the limitations and hurdles that such a policy contains. Here, we highlight these limitations by drawing on the influential work of Kenneth Arrow, who has argued that we cannot treat the health-care market as if it was just another market, and the ideas of Herbert Simon, who questioned whether people had sufficient cognitive abilities to make effective choices in an information-rich environment. In the light of these two strands of thought, we review evidence suggesting that many older adults have low (health) literacy levels, raising concerns over their ability to obtain, process and understand medical-related information, with its increasing complexity, associated risks and emotional involvement. We also discuss recent findings from the United States highlighting the difficulties older users of health-care face with a wide range of prescription drug insurance plans from which to choose. Thus, learning from the experience of health-care systems where choice is abundant could help any health system interested in extending patients' choice to better target the domains where more choice could be beneficial and possibly avoid those where it could be detrimental.

Trends in Community Pharmacy Counts and Closures Before and After the Implementation of Medicare Part D

Medicare Part D provided 3.4 million American seniors with prescription drug insurance. It may also have had an unintended effect on pharmacy viability. This study compares trends in the number of pharmacies and rate of pharmacy closures before and after the implementation of Medicare Part D. This retrospective observational study used data from National Council for Prescription Drug Programs (NCPDP) to track retail pharmacy closures and counts between January 2004 and January 2009. Pharmacies were classified by ownership (chain or independent), location (urban or rural), and whether they were the only pharmacy in a community. Autoregressive Integrated Moving Average (ARIMA) models were used to examine trends in pharmacy counts and closures. The number of independent and rural pharmacies decreased significantly after the implementation of Medicare Part D. The number of communities that saw their only pharmacy close also increased. Unintended consequences of Medicare Part D may serve to reduce patient access to pharmacy services in opposition to the stated goals of the program.

Association of number of follow-up providers with outcomes in survivors of hematologic malignancies

Studies examining follow-up care among cancer survivors have increased in number, and are mostly focused on who best provides care. It is not known whether having single or multiple physicians as follow-up providers has outcome implications. We prospectively studied the association between number of follow-up providers among survivors of hematologic malignancies and serious medical utilization (defined as emergency room visits or hospitalizations) within a 6-month period. Patients completing treatment (n = 314) were included. Patients seeing multiple follow-up providers were more likely to be younger, to reside farther away from the university hospital, to have prescription drug insurance, to have received prior cancer treatment, to have multiple myeloma, and to have undergone hematopoietic cell transplant as a part of cancer treatment. Multivariate analysis showed that the number of follow-up providers was not associated with serious medical utilization (odds ratio 1.29, 95% confidence interval 0.68–2.48, p = 0.44) after adjusting for patient factors. Our study showed that among survivors of hematologic malignancies, outcomes were not different for survivors who were seen by single or multiple follow-up providers.

Use of Guideline‐Recommended Therapies for Heart Failure in the Medicare Population

Most information about the use of guideline-recommended therapies for heart failure reflects what occurred at discharge after an inpatient stay. Using a nationally representative, community-dwelling sample of elderly Medicare beneficiaries, we examined how the use of angiotensin-converting enzyme (ACE) inhibitors, angiotensin receptor blockers (ARBs), and beta-blockers has changed and factors associated with their use. Using data from the Medicare Current Beneficiary Survey cost and use files matched with Medicare claims data, we identified beneficiaries for whom a diagnosis of heart failure was reported between January 1, 2000, and December 31, 2004. Data on medications prescribed during the year of cohort entry were based on patient self-report. We used multivariable logistic regression to explore relationships between the use of ACE inhibitors/ARBs and beta-blockers and patient demographic characteristics. From 2000 through 2004, the use of ARBs increased from 12% to 19%, and the use of beta-blockers increased from 30% to 41%. The use of ACE inhibitors remained constant at 45%. Beneficiaries who reported having prescription drug insurance coverage were 32% more likely than other beneficiaries to have filled a prescription for an ACE inhibitor or ARB and 26% more likely to have filled a prescription for a beta-blocker. Although the use of guideline-recommended therapies for heart failure has increased, it remains suboptimal.

Out-of-pocket (OOP) spending burden for Medicare beneficiaries with cancer.

9124 Background: The financial burden associated with out-of-pocket medical costs can be devastating for Medicare beneficiaries with cancer. Costs for cancer-related treatment are substantial, yet Medicare and supplemental coverage may not provide adequate financial protection. This may be particularly true for traditionally vulnerable groups, defined by race, income, and health status. Methods: We used data from the 2006 Medicare Current Beneficiary Survey (MCBS), a nationally representative survey of the Medicare population that reports beneficiary demographics, health status, and supplemental insurance coverage. Medical spending is based on self-report augmented by Medicare Parts A and B claims. We selected fee-for-service enrollees who reported that they ever had a cancer diagnosis (N=2,007). Bivariate analyses compared spending by patient characteristic. Results: 7.5 million or 17% of the Medicare population reported a cancer diagnosis, with 3% reporting incident cancer. 89% were age >=65, 8% black, 5% Hispanic, 45% low income, 33% in fair/poor health, 90% with supplemental medical coverage, 89% with prescription coverage; 50% were enrolled in Medicare Part D plans. Mean total spending was $16,854 (95% CI: $15,539-$18,169), and OOP was $2,753 (95% CI: $2,408-$3,098) for prevalent cases; total spending was $26,345 (95% CI: $22,439-$30,251) and OOP $4,062 (95% CI: $3,015-$5,109) for incident cases. At the median, OOP spending (including premiums) was 14% of income. Median OOP spending on prescription drugs was 42% of total OOP. Mean OOP spending was lower for black patients vs white, excellent vs fair/poor health, Medicaid vs no supplemental coverage (all at p<.01). Conclusions: Given the prevalence of major chronic illness in the Medicare population, our prevalent cancer cohort experienced a large, but not disproportionate financial burden. However patients with new cancer diagnoses, and those disadvantaged by socioeconomic and poor health status were particularly vulnerable. Additional research is needed to examine how financial resources and supplemental medical and prescription drug insurance affect cancer treatments, and access to preventive and primary care in this cohort. No significant financial relationships to disclose.