Seniors Citizens Overspend On Medicare Part D Drug
Program: Health Affairs Study
Only 5.2 percent of Medicare recipients chose the
most economic Part D plan available
By Ankita Rao, Capsules -The KHN Blog
11, 2012 - Seniors spent on average $368 more than they needed to on
drug coverage through Medicare Part D plans in 2009 — their decisions
complicated by the sheer volume of plans available and difficulties
involved in determining what makes a plan a good choice, a
Health Affairs study
released Tuesday has found.
There are 1,736 plans available to Medicare
beneficiaries for purchasing prescription drugs through Medicare’s Part
D program, and, based on 2009 data, that’s about 50 plans per region.
The study authors found, though, that only 5.2
percent of Medicare recipients chose the most economic Part D plan
available. This happened despite video tutorials, online materials and
printed information guiding seniors to choose an appropriate plan.
Zhou, a co-author of the study and a faculty member at the University of
Pittsburgh, said that the experiences generated by Medicare Part D’s
market-based approach could guide the next steps in health care.
For instance, its lessons could be applied to the
health law’s insurance exchanges – marketplaces in which people who
qualify for subsidies could easily compare plans and costs as they
purchase insurance, according to the study.
“In general this market approach is a good thing,
but when there are so many options, we need seniors to choose a better
plan,” Zhou said.
Co-author Yuting Zhang, who is a University of
Pittsburgh assistant professor, said that plan choices weren’t affected
by how sick a patient was or if they had mental disorders. The study did
show, however, that excess spending increased with age and varied by
Medicare 2013 Open Enrollment
Oct. 15 – Dec. 7
find Medicare tools and information, and compare the cost or
benefits of 2013 Medicare health plans in your area,
The tendency of beneficiaries to “overprotect
themselves by purchasing plans with relatively generous features” was
also one of the main drivers of excess spending. The authors wrote that
some seniors looked past their medication needs to choose plans with low
deductibles, and ended up with higher premiums.
Zhang suggested more targeted government assistance
might help Medicare recipients better choose their plan. “If they are
able to choose their plans, we could rely on a private market to drive
down costs,” she said.
But one health care advocate said that the tools
for choosing the cheapest option already exist
on the official
“There’s so much out there for people to access
information,” said Julie Bennett, a community outreach specialist for
HICAP, a Sacramento-based health care counseling and awareness program
that is part of the volunteer-based group,
Bennett, who regularly talks to seniors in northern
California about Medicare, said that beneficiaries received ample
information in the form of government-distributed “Medicare and You”
books, and an online video tutorial. She said most of the people she
counsels, including those living under the poverty level, knew how to
access materials on the Internet.
But Bennett also said that the number of variations
in each Part D plan was a confusing obstacle to their Medicare choices.
“It’s complicated, and every individual has a
different situation,” she said. “We have to make sure the person we’re
helping understands their situation is probably unique.”
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