Cost containment strategies, such as tiered drug plans, reduce overall prescription drug utilization and increase the use of generics, according to an analysis of prescription drug use by Medicare-eligible retirees.
But even with decreased utilization, individuals enrolled in three-tiered drug plans, which charge higher copayments for certain medications, spent more money out of pocket than did individuals enrolled in single-tiered plans.
The study, conducted by researchers at Mathematica Policy Research Inc. and RTI International, included 352,760 Medicare beneficiaries with employer-sponsored drug coverage and dependent spouses aged 65 or older (Health Serv. Res. 2007 Sept. 11 [Epub doi:10.1111/j.1475-6773.2007.00774.x]).
The study is further confirmation that the retiree population is sensitive to price, “but we don't know what that means in terms of health outcomes,” Boyd H. Gilman, Ph.D., a senior researcher at the Cambridge, Mass., office of Mathematica, said in an interview.
On average, individuals in single-tiered plans filled 46 prescriptions a year, compared with 38 prescriptions among those enrolled in three-tiered plans. But enrollees in singled-tiered plans used fewer generics, the researchers found. Nearly 39% of the drugs purchased under single-tier plans were generics, compared with nearly 44% in three-tiered plans.
Drug plans spent about $1,943 per individual in single-tiered plans, versus $1,354 in three-tiered plans. Individuals who were enrolled in single-tier plans spent about $245 a year, compared with $469 spent by individuals enrolled in multitiered plans.
The study was funded by an internal grant from RTI International.