Abstract
Background/Aims: Many Medicare Part D enrollees face gaps in their prescription drug cost coverage after $2,250 in annual drug expenditures. Beneficiaries with chronic illnesses may be particularly vulnerable to coverage gaps, with estimates ranging as high as 64% of diabetic beneficiaries entering the gap. We examined total drug costs and out-of-pocket drug costs, and rates of entry and exit into the Part D coverage gap for beneficiaries with diabetes in two large California Medicare Advantage plans.
Methods: Beneficiaries from two large health plans in the TRIAD (Translating Research Into Action for Diabetes) Study offering Medicare Advantage Part D plans in California were included if they had diabetes; signed up for Part D between November 15, 2005 and March 1, 2006; and had a drug coverage gap starting at $2,250. Entry and exit into the gap was determined using pharmacy databases. Beneficiaries hit the gap after incurring $2,250 in total drug costs; beneficiaries exited the gap after incurring $3,600 in out-of-pocket costs.
Results: In 2006, 25% of the 45,732 beneficiaries reached the coverage gap and then paid the full price of their drugs. Only 1% of beneficiaries exited the gap and qualified for ‘catastrophic’ drug cost assistance. On average, diabetes beneficiaries incurred $1,942 in total drug costs during 2006. For beneficiaries who did not enter the coverage gap, total drug expenditures and out-of-pocket drug expenditures remained stable over the year. For the beneficiaries who fell into the drug coverage gap in 2006, total drug costs were much higher overall and decreased over the year as out-of-pocket expenses increased.
Conclusions: This is the first examination of diabetic Medicare beneficiaries under the Part D program. Fewer entered the coverage gap than had been previously estimated. Those entering the gap, however, had lower subsequent monthly drug expenditures. Potential reasons for both include lower than expected drug prices or drug adherence and higher than expected use of less expensive drugs, such as generics. Future work will examine these alternative explanations and explore risk factors for entering the Part D coverage gap.
- Received September 11, 2008.
