Overall, the U.S. government spent $32 billion on the new drug benefit in 2006, and that's expected to accumulate to $797 billion by 2015, according to the Congressional Budget Office.
"Our findings do not necessarily mean that the Medicare Part D program is economically inefficient, because there are potential long-term health care savings when people can afford to take necessary medications," Lichtenberg said. "However, we need to think carefully about the economic implications of this program, which the federal government will ultimately have to raise taxes to pay for."
Another study in the November/December issue of Health Affairs found that overall annual out-of-pocket health spending by Medicare beneficiaries increased 50 percent between 1997 and 2003, from $1,667 to $2,501.
The study, by researchers at the Kaiser Family Foundation and University of California, Los Angeles, also found that the oldest, frailest and poorest Medicare beneficiaries spend a much greater portion of their income on premiums and health services than other beneficiaries.
In 2003, those in the top quarter of spending shelled out 30 percent of their income for health care, while those in the top 10 percent spent nearly 60 percent of their income on health care. Overall, 40 percent of beneficiaries spent more than 20 percent of their income on health.
The findings "raise important questions about how much of their incomes beneficiaries can reasonably be expected to spend on their health care and whether current out-of-pocket spending levels are affordable," the researchers wrote.
Out-of-pocket health care
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