Medicare Part D linked to fewer hospital visits, lower costs

Prescription drug insurance for seniors will reduce the use of and spending on nonpharmacy medical services, researchers at the University of Illinois and Johns Hopkins University in Baltimore found when comparing national records from before and after Medicare Part D started in 2006.

The study looked at how purchasing prescriptions through the Medicare Part D program affected hospital visits, costs relating to those visits and mortality.

Along with an 8 percent drop in hospital visits, the study showed prescription drug insurance was linked to a 7 percent decrease in Medicare payments per person for inpatient services and a 12 percent decrease in inpatient charges per person. 

When looking at the correlation between hospital admissions and Part D, researchers found admittance for dehydration dropped 20 percent, chronic obstructive pulmonary disease admissions fell 32 percent and admissions for congestive heart failure dropped 18 percent.

But the findings didn't show a difference in death rates between seniors who used Part D and those who didn't. "It's somewhat surprising that we didn't see a mortality effect, given that we did see decreases in hospitalization," co-author Robert Kaestner, an economist at the University of Illinois at Chicago, told Kaiser Health News.

After the creation of the Part D program, prescription drug insurance increased from about 66 percent to 90 percent. With this increase in Part D coverage, costs will continue to rise--the Congressional Budget Office estimates a $51 billion increase from 2013 to 2022, the study finds. 

Despite $1.5 billion in hospital cost savings, Part D continues to cost taxpayers more than it saves. In January, the Centers for Medicare & Medicaid Services announced revisions to Medicare C and D regulations with hopes to save the program about $1.3 billion over five years, FierceHealthPayer previously reported.

For more:
- here's the Kaiser Health News article
- check out the study

Read more on