Designing a Medicare prescription drug benefit: issues, obstacles, and opportunities

Association of kyphotic posture with loss of independence and mortality in a community-based prospective cohort study: the Locomotive Syndrome and Health Outcomes in Aizu Cohort Study (LOHAS)

OBJECTIVES

This study aimed to investigate the association between kyphotic posture and future loss of independence (LOI) and mortality in community-dwelling older adults.

DESIGN

Prospective cohort study.

SETTING

Two Japanese municipalities.

PARTICIPANTS

We enrolled 2193 independent community-dwelling older adults aged≥65 years at the time of their baseline health check-up in 2008. Kyphotic posture was evaluated using the wall-occiput test (WOT) and classified into three categories: non-kyphotic, mild (>0 and ≤4 cm) and severe (>4 cm).

PRIMARY AND SECONDARY OUTCOME MEASURES

The primary outcome was mortality and the secondary outcomes were LOI (new long-term care insurance certification levels 1-5) and a composite of LOI and mortality. A Cox proportional hazards model was used to estimate the adjusted HRs (aHRs).

RESULTS

Of the 2193 subjects enrolled, 1621 were included in the primary analysis. Among these, 272 (17%) and 202 (12%) were diagnosed with mild and severe kyphotic postures, respectively. The median follow-up time was 5.8 years. Compared with the non-kyphotic group, the aHRs for mortality were 1.17 (95% CI 0.70 to 1.96) and 1.99 (95% CI 1.20 to 3.30) in the mild and severe kyphotic posture groups, respectively. In the secondary analysis, a consistent association was observed for LOI (mild: aHR 1.70, 95% CI 1.13 to 2.55; severe: aHR 2.08, 95% CI 1.39 to 3.10) and the LOI-mortality composite (mild: aHR 1.27, 95% CI 0.90 to 1.79; severe: aHR 1.83, 95% CI 1.31 to 2.56).

CONCLUSION

Kyphotic posture was associated with LOI and mortality in community-dwelling older adults. Identifying the population with kyphotic posture using the WOT might help improve community health.

Demand for a Medicare Prescription Drug Benefit: Exploring Consumer Preferences under a Managed Competition Framework

Several proposals for adding a prescription drug benefit to the Medicare program rely on consumer choice and market forces to promote efficiency. However, little information exists regarding: 1) the extent of price sensitivity for such plans among Medicare beneficiaries, or 2) the extent to which drug-only insurance plans using various cost-control mechanisms might experience adverse selection. Using data from a survey of elderly Wisconsin residents regarding their likely choices from a menu of hypothetical drug plans, we show that respondents are likely to be price sensitive with respect to both premiums and out-of-pocket costs but that selection problems may arise in these markets. Outside intervention may be necessary to ensure the feasibility of a market-based approach to a Medicare drug benefit.

Perverse Incentives in the Medicare Prescription Drug Benefit

This paper analyzes some of the perverse incentives that may arise under the current Medicare prescription drug benefit design. In particular, risk adjustment for a standalone prescription drug benefit creates perverse incentives for prescription drug plans when making coverage decisions and/or for pharmaceutical companies when setting prices. This problem is new in that it does not arise with risk adjustment for other types of health care coverage. For this and other reasons, Medicare's drug benefit requires especially close regulatory oversight, now and in the future. We also consider a relatively minor change in financing the benefit that could lead to significant changes in how the benefit functions. In particular, if all plans were required to charge the same premium, there would be less diversity in quality, but also less need to regulate formulary composition, less budgetary uncertainty, and less upward pressure on drug prices.

Exploring the demand for a voluntary Medicare prescription drug benefit

The purposes of this study were (1) to assess the utility of the economic theory of demand for insurance for modeling voluntary Medicare drug benefit enrollment decisions and (2) to explore the degree of adverse selection and crowd-out that might occur under a voluntary enrollment Medicare prescription benefit. Data were collected using a cross-sectional, mail survey of 2,100 community-dwelling adults aged 65 and older in Wisconsin. Respondents were asked to evaluate their likelihood of enrollment in any of 4 hypothetical drug benefit plans under the assumption that they could enroll in one of the hypothetical plans or maintain their current coverage. Data analyses included bivariate comparisons across enrollment likelihood categories and logit analysis of enrollment likelihood as a function of respondent characteristics. 1041 usable survey forms were returned for an adjusted response rate of 51.5%. Older adults with 4 or more chronic conditions were most likely to report that they were "very likely" to enroll in one of the hypothetical drug plans, as were those with the highest out-of-pocket drug spending in the previous 30 days. Respondents with no or self-purchased drug benefits were more likely than those with employer-based plans to express a higher likelihood of enrollment in one of the hypothetical plans. Adverse selection may be problematic for a voluntary enrollment Medicare drug benefit. Given that high out-of-pocket drug spending (secondary to drug coverage source) was a consistent predictor of enrollment likelihood, demand-side factors affecting the crowding out of employer-based drug coverage sources by a voluntary enrollment drug benefit appear minimal. However, the availability of a Medicare prescription benefit may still lead to crowd-out through employer incentives.

Health insurance for Americans approaching age sixty-five: an analysis of options for incremental reform

This article provides a systematic evaluation of the options for incremental health insurance reforms aimed at older Americans nearing age sixty-five. It presents three basic arguments for giving special consideration to this age group: (1) early retirement and its effect on access to employer insurance; (2) changes in health and health care expenses associated with increasing age; (3) the vulnerability to unexpected economic or health "shocks" that will affect people throughout their retirement. The analysis of policy options begins by specifying criteria for evaluating alternative approaches to reform. The proposed criteria emphasize that reforms for this age group should be designed to fit with other financial plans and decisions made during such a transitional stage of life. Policy options should be judged according to fundamental goals such as equity and efficiency, not simply ranked according to the number of uninsured who will gain coverage. After offering a comprehensive catalog and evaluation of available options, the analysis identifies and discusses a preferred approach-which preserves choices while offering universal and subsidized access to Medicare before age sixty-five.

Exploring prescription drug coverage and drug use for older americans

OBJECTIVE

To describe existing prescription drug insurance coverage for older Americans, to describe out-of-pocket payment levels per prescription associated with service benefit prescription drug plans used by older persons, and to examine the association of prescription drug coverage types with the reported use of prescription drugs by older persons.

PATIENTS AND METHODS

Data were obtained from a national survey of 1570 community-dwelling older persons (>65 y) conducted in June 1998. A 2-part utilization model was estimated using logistic regression and ordinary least-squares regression.

RESULTS

Data from 310 respondents were used for analysis. Overall, 66.1% of respondents reported having prescription drug insurance coverage. A majority (76.6%) of respondents having private drug coverage reported having a service benefit plan (requiring copayment or coinsurance amount to be paid for each prescription). The median copayment per brand name and generic prescription for persons reporting having coverage by service benefit plans was $10 and $5, respectively.

CONCLUSIONS

Overall, a majority of older persons reported paying relatively small amounts out-of-pocket per prescription during 1998. Among persons who reported having drug insurance coverage, there were no statistically significant differences in the reported number of drugs used daily, regardless of out-of-pocket payment amount per prescription. Patient need and level of past drug use were significantly associated with both the likelihood of using any prescription drugs and the level of use among users. More research is needed to examine differences in drug expenditures and characteristics of drugs used across prescription drug insurance types for older persons.

Use of home health services covered by new public long-term care insurance in Japan: impact of the presence and kinship of family caregivers

OBJECTIVE

In April 2000, the system for caring for the elderly in Japan was changed drastically with the launch of new long-term care insurance. Unlike the previous system, the maximum monthly amount of insured services is now decided solely by an applicant's physical condition, regardless of family support. We investigated whether the presence and kinship of a family caregiver still affect service use under the new system.

DESIGN

A cross-sectional, mailed, self-administered questionnaire survey and analysis using multiple logistic regression.

SETTING

One month after the introduction of long-term care insurance in Japan.

PARTICIPANTS

The main family caregivers of 237 applicants for long-term care insurance with a caregiver and 33 applicants without a caregiver, living in the community in one city.

OUTCOME MEASURES

The applicants' sex, age, and eligible care level, existence of a family caregiver, family caregiver's sex, age, and kinship, and service use for each service covered by long-term care insurance.

RESULTS

Caregiver factors significantly affected use of the main services. The most popular service, nursing-home daycare, was utilized most when a wife was caring for her husband. As the level of care increased, this service was utilized less. Home help, the second most popular service, was most utilized when a wife was caring for her husband or when there was no caregiver.

CONCLUSION

The use of major services may be decided more by the needs of caregivers than by the care level of the applicant. To successfully implement the new system, consideration of the caregiver situation should be included in policy making.

Prescription noncompliance due to cost among adults with disabilities in the United States

OBJECTIVES

This study estimated national prevalence rates of medication noncompliance due to cost and resulting health problems among adults with disabilities.

METHODS

Analyses involved 25,805 respondents to the Disability Follow-Back Survey, a supplement to the 1994 and 1995 National Health Interview Surveys.

RESULTS

Findings showed that about 1.3 million adults with disabilities did not take their medications as prescribed because of cost, and more than half reported health problems as a result. Severe disability, poor health, low income, lack of insurance, and a high number of prescriptions increased the odds of being noncompliant as a result of cost.

CONCLUSIONS

Prescription noncompliance due to cost is a serious problem for many adults with chronic disease or disability. Most would not be helped by any of the current proposals to expand Medicare drug coverage.

Improving quality through public disclosure of performance information

Despite a growing consensus that serious quality problems afflict U.S. health care, state and federal governments have done little to improve the quality of care. Proposed health insurance reforms, including a Medicare prescription drug benefit and the use of tax credits for insurance expansion, could create a mechanism for stimulating and then monitoring improvements in quality. We propose legislative requirements that any new expenditure of federal funds for health benefits be accompanied by public disclosure of performance information regarding quality, effectiveness, and safety. Such disclosure could yield diverse public and institutional benefits.

Beyond survey data: a claims-based analysis of drug use and spending by the elderly

Previous estimates of Medicare beneficiaries total and out-of-pocket spending on outpatient prescription drugs have largely been based on data from the 1995 Medicare Current Beneficiary Survey and have focused on how expenditures vary among beneficiaries with different demographic characteristics. This paper reports the results of an analysis of prescription claims from 1998 for more than 375,000 elderly persons whose prescription benefit was managed by Merck-Medco Managed Care. In addition to examining how total and out-of-pocket drug spending in a well-insured population varies by age and sex, we report how total and condition-specific drug spending varies for elderly persons with ten common chronic diseases. Our results illustrate the highly skewed nature of prescription drug spending, even among those with drug coverage, and underscore the particularly high cost burden that pharmaceuticals place on elderly people with chronic diseases.