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Study Finds Savings From Medicare's Drug Plan Extend Beyond Cost of Meds
Date:7/26/2011

By Amanda Gardner
HealthDay Reporter

TUESDAY, July 26 (HealthDay News) -- The savings for U.S. seniors who participate in the Medicare Part D prescription drug plan may extend far beyond the cost of medications, a new study indicates.

Part D participants also seemed to have lower hospital and nursing home bills, possibly because easier access to medicines has kept them healthier longer.

"That effect of Part D was mostly explained by reduced spending on hospital and shorter-term nursing home stays that follow hospitalization," said Dr. J. Michael McWilliams, lead author of a study published in the July 27 issue of the Journal of the American Medical Association. "There was no effect of Part D on outpatient care."

Previous studies had found that enrollees used more prescription medications, used them as directed and had less out-of-pocket costs after Medicare Part D was implemented in January 2006.

"What hasn't been clear is whether this has translated into preventing costly complications and reduced non-drug medical care," said McWilliams, who is a general internist with Brigham & Women's Hospital and an assistant professor of health care policy and medicine at Harvard Medical School in Boston.

McWilliams and his team looked at Medicare claims data on 6,000 enrollees in the two years before and two years after implementation of Part D.

About 2,500 of the participants had "generous" prescription drug benefits before Part D kicked in and served as a "control group," while about 3,400 had limited drug coverage before Part D.

For those who had limited drug coverage before 2006, non-drug health care was about $1,200 a year lower compared with what would have been expected in the absence of Part D.

Those who started out with generous coverage had slightly decreased costs after Part D, McWilliams said.

This was largely because of fewer inpatient stays and less time at ski
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