Will Cost of Arthritis Drugs Soon Be More than
Medicare, Senior Citizens Can Afford?
Insurance companies in Medicare Part D are shifting
more of cost to seniors, Medicare
June 2, 2009 Certain drugs that are effective at
reducing symptoms and slowing progression of rheumatoid arthritis (RA),
a common condition for senior citizens, are so expensive they are
putting pressure on Medicare Part D plans and beneficiaries. Some
speculate that soon neither will be able to afford them.
Biologic disease-modifying antirheumatic drugs (DMARDs)
such as adalimumab, etanercept and infliximab are effective against RA.
They act more quickly, require less laboratory monitoring, and are
better tolerated than nonbiologic DMARDs, but they are also up to 100
times more expensive.
Medicare's strong consumer satisfaction suggests
that many under age 65 would choose a public health insurance option if
it were offered, says Commonwealth Fund
Insurance plans differ greatly in their coverage of
and cost sharing for biologic DMARDs, sometimes shifting a large portion
of the cost to patients. A new study examined the cost-sharing
structures for biologic DMARDs in Part D plans and the resulting cost
burden to patients. The study was published in the June issue of
Arthritis Care & Research.
In 2003, Congress created the Medicare Replacement
Drug Demonstration (MRDD) to provide temporary drug insurance until the
start of Medicare Part D in 2006.
The MRDD, which ran September 2004 December 2005,
targeted low-income vulnerable Medicare patients with select conditions,
including RA, who did not have comprehensive drug insurance coverage.
This program had similar cost-sharing arrangements
to Medicare Part D and evaluations showed that it reduced financial
barriers and improved health outcomes.
However, unlike the MRDD, Part D plans could place
high-cost items such as biologic DMARDs in a specialty tier, where they
are subject to higher patient cost sharing. There is concern that
specialty tiering imposes a heavy financial burden on RA patients.
Led by Jennifer M. Polinski of Brigham and Women's
Hospital in Boston, researchers followed almost 15,000 vulnerable,
low-income patients who were enrolled in the MRDD as they transitioned
into Part D in 2006.
They grouped patients into one of three drug
coverage options: enrollment in a Part D plan further stratified by a
Medicare Advantage or stand-alone plan, other creditable coverage or
unknown coverage. They examined the benefit design of each plan, as well
as potential differences in beneficiaries' annual out-of-pocket costs
for biologic DMARDs under three coverage scenarios.
They found that 81 percent of poor and disabled
Medicare beneficiaries with RA who participated in the MRDD program had
enrolled in Part D plans by July 2006.
Compared with stand-alone Part D plans, Medicare
Advantage plans offered lower deductibles, lower premiums, and were more
likely to require copayments (which are fixed), rather than coinsurance
(typically a percentage paid by the insured person pays after an
insurance deductible has been exceeded).
They also placed significantly fewer restrictions
on biologic DMARD reimbursement.
"In spite of the greater generosity and lesser
restrictions of Medicare Advantage plans, the most sick and most
financially needy patients enrolled in these plans less often than they
did in stand-alone plans," the authors note.
Most patients enrolled in plans that placed
biologic DMARDs on high-cost specialty tiers and used coinsurance
proportions as high as 75 percent. The specialty tier was created to
ensure that beneficiaries receiving high-cost biologic agents were not
discriminated against in terms of cost sharing, but there is concern
about the financial impact of this structure, especially the widespread
use of high coinsurance.
The study found that Part D plans that require
coinsurance instead of copayments shift the financial burden of these
high-cost medications from the plan to the patient and to Medicare.
In plans where cost sharing is high (e.g. plans
with high coinsurance), patients may delay or not even begin therapy due
to the high cost. In plans with cost sharing that is steep but
manageable (e.g. plans with high copayments) patients may begin therapy
but then discontinue it when faced with paying the full cost of the
medication out of pocket. "Neither scenario is optimal for patients who
may benefit from biologic DMARDs," the authors point out.
Specialty tier and coinsurance resulted in
estimated annual expenditures for patients that exceeded $4,000 despite
drug insurance coverage and more Part D plans have adopted specialty
tiering over time.
In 2006, 60 percent of the national stand-alone
plans used this system but by 2008, 87 percent were using it.
Similarly, between 2006 and 2008, the number of
plans charging 33 percent coinsurance increased more than five-fold.
"Patients assume up to 28 percent and Medicare
assumes more than 58 percent of the costs of biologic DMARDs in our
scenarios, yet neither is in a position to sustain such financial
burden," the authors conclude.
"As more biologic DMARDs are approved and used for
RA and more plans use the specialty tier system, both beneficiaries and
Medicare face costs they may be increasingly unable to afford."
Information Source:
Article: "Impact of Medicare Part D on Access to
and Cost Sharing for Specialty Biologic Medications for Beneficiaries
with Rheumatoid Arthritis," Jennifer M. Polinski, Penny E. Mohr,
Lorraine Johnson, Arthritis & Rheumatism (Arthritis Care & Research),
June 2009.
Keep up with the latest news for senior citizens, baby
boomers
June 2, 2009 Certain drugs that are effective at
reducing symptoms and slowing progression of rheumatoid arthritis (RA),
a common condition for senior citizens, are so expensive they are
putting pressure on Medicare Part D plans and beneficiaries. Some
speculate that soon neither will be able to afford them.
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