Medicare Part D: Where The Patients Are
1 CommentBy Ed Silverman // July 31st, 2007 // 4:25 pm
Slicing and dicing is a lucrative activity for IMS Health, and so the research firm has just released a Medicare D analysis with a lot of interesting data. As an example, the chart indicates which type of meds beneficiaries sought. A few key findings:
- More than half, or 58 percent of beneficiaries previously had some private drug coverage, while 14 percent previously paid for drugs totally out-of-pocket. And 24 percent previously received coverage under Medicaid. And the previously uninsured benefited the most from Part D, saving 60 percent of their previous cost and increasing their use of meds by 26 percent.
- A quarter of seniors paying for their drugs totally out-of-pocket in 2005 moved to Part D in 2006, but another 55 percent continued to pay cash. This group of about 7.4 million seniors include those who may have decided that participating in this program didn’t make financial sense.
- The uptake of Part D prescription volume increased steadily through June 2006 as enrollment continued and patients grew familiar with the program. During the second half of the year, the Part D share of the retail market stabilized at 17 percent.
- Seniors who previously had third-party coverage paid on average 17 percent less for their scrips compared to the prior year,
and filled about 10 percent more scrips than in 2005.
- A major concern at the beginning of 2006 was the impact the donut hole, or coverage gap, would have on adherence. A study of 14 large brands for chronic conditions found that between 14 percent and 25 percent of patients dropped their meds after reaching the gap.
- By the final week of 2006, the unbranded generic share of Part D scripts was 58 percent, compared to a 57 percent share among total retail scrips. Brand share of Part D scripts was 36 percent by year’s end, slightly higher than the 34 percent brand share recorded for all retail scrips. Branded generics held a smaller share among Part D scripts - 6 percent versus 10 percent among all retail scripts.
UPDATE: As one reader points out, however, this data includes only retail scrips, so the analysis reflects something less than 100 percent of the Part D universe. There also may have been other reasons why some didn’t sign up for the plan, initially, or stopped their meds after reaching the donut hole, such as compliance.
Lew
Ed,
This IMS analysis may be misleading for a number of reasons, not the least of which is that it based only on retail scripts. In the old commercial world this type of analysis may have been reasonably accurate; however, in this instance, the analysis does not include LTC scripts, a significant portion of the overall Part D market. In addition, at the retail level, IMS cannot always break out Part D scripts from commercial scripts (this is called masking). As I understand it, about 20% of Part D scripts are masked as commercial scripts; thus, rather than a 17% share, it is probably closer to 21% or 22% of total retail.
Also, IMS doesn’t explain that while 58% of enrollees had some sort of private coverage prior to Part D, many of these beneficiaries had Medigap or Medicare Advantage coverage, which most often offered very limited benefits.
IMS also speculates that of the 7M+ who didn’t sign up, many made that decision for financial reasons. That may be the case. However, if you look at 2007 CMS data, the total number looks to be much smaller. And about 3.5M of that group would qualify for the low income subsidy, making the benefit extremely low cost. More likely reasons for not enrollingm may have been lack of knowledge, limited cognitive ability, suspicion of government programs, etc.
Finally, the donut hole information is also misleading. While they state that 14% to 25% of beneficiaries drop their medication when reaching the donut hole, this statistic is meaningless without understanding how many would have dropped anyway. For instance, in any given month, about 15% of statin users stop their medication. Other categories range from 5% to 30%.
IMS does a nice job with thier analysis, but their eagerness to be demonstrate expertise sometimes leads them to be less than thorough.
Lew