Medicare Part D Beneficiaries Experience Financial Gap

Armen Hareyan's picture

A newly conducted survey of Medicare Part D beneficiaries shows that health insurance plan brought some improvements to seniors, but there are still beneficiaries experiencing financial gap because of high medication costs.

The survey was conducted by Harvard Medical School in Boston involving 24234 Medicare beneficiaries. The participants were questioned about drug expenses they use and about their behavioral changes to meet these costs and spending.

Medicare Part D plan took effect in January 2006. About half of Medicare beneficiaries were enrolled in the new plan, but some 10% of them were still remaining without coverage. This is an improvement compared to 38% before the new plan took effect. However, those needing comparably expensive drugs experience financial difficulties to obtain the drugs because cost-share policy and they frequently change the type and the dosage of drugs to be able to cope with the costs.


In 2004 and 2005 about 15.2% and 14.1% of Medicare beneficiaries were skipping drug intakes and switching to less expensive drugs to meet the costs. This percentage was lowered to 11.5% in 2006 after Medicare Part D plan took effect. In 2004 and 2005 about 10.6% and 11.1% of Medicare beneficiaries were skipping basic needs to be able to pay for life saving medicines. This percentage was lowered to 7.6% in 2006.

The figures show improvement after Medicare Part D plan took effect, but those sickest seniors needing the most expensive drugs - from $2250 to $5100 - experience financial gap because of too high cost-shares.

Another telephone survey conducted by Kaiser Permanente Medical Care Program involved 1040 participants over age of 65. They were surveyed about prescription drug costs and behavioral changes they make in order to meet the spending. The survey found that about 40% of questioned seniors are clearly aware about financial gap they may experience because of high medication costs. About 36% of participant reported dosage changes, 26% reported switching to less expensive drugs, about 15% reported adherence decrease, and 7% reported deep financial gap.

The two surveys show that Medicare Part D plan made some improvements, such as providing health insurance for more people. However, the plan still lacks efficiency, because most of beneficiaries using comparably expensive drugs seriously suffer from high costs for buying necessary medicines. The second survey also shows that those covered with the plan lack knowledge of how cost-sharing policies can affect their financial state and that they may experience financial gap if they need more expensive drugs. More needs to be done to enroll more people in the plan and ensure that those covered will be able to get necessary medications and live a healthy life.