Despite New Medicare Drug Benefit, Prescription Drug Access Unchanged; Access Gaps Remain for Elderly African-Americans, Sicker Beneficiaries and Lower-Income Seniors

Proportion of Seniors Eligible for Both Medicare and Medicaid Who Skipped a Prescription Because of Costs Almost Doubled Between 2003 and 2007

News Release
March 5, 2009

Alwyn Cassil (202) 264-3484 or

WASHINGTON, DC—The introduction of the outpatient Medicare drug benefit in 2006 did little to close longstanding prescription drug access gaps between white and African-American seniors, healthier and sicker beneficiaries, and lower-income and higher-income beneficiaries, according to a national study released today by the Center for Studying Health System Change (HSC) and funded by the Robert Wood Johnson Foundation.

Overall, roughly the same proportion of community-resident elderly Medicare beneficiaries in 2003 and 2007—about 8 percent—skipped filling at least one prescription drug because of cost concerns, according to findings from HSC’s 2007 Health Tracking Household Survey, a nationally representative survey containing information on 3,200 Medicare beneficiaries. The survey had a 43 percent response rate. Over the same period, however, more working-age adults went without a prescribed drug because of cost, suggesting the new Medicare drug benefit may have prevented a similar deterioration in access for the elderly.

But, the new Medicare drug benefit did little to close large, longstanding prescription drug access gaps for the most vulnerable beneficiaries, the study found. In 2007, almost three times as many elderly African-American beneficiaries (17.6%) skipped filling a prescription as white beneficiaries (6.2%), while nearly four times as many seniors in fair or poor health (16.6%) went without a prescribed drug as those in good to excellent health (4.4%). Likewise, almost 16 percent of beneficiaries with incomes below 150 percent of the federal poverty level—$15,315 for an individual or $20,535 for a couple in 2007—reported unmet prescription drug needs in 2007, compared with 2.7 percent of beneficiaries with incomes at or above 300 percent of poverty.

And, in the case of seniors dually eligible for Medicare and Medicaid, prescription drug access problems almost doubled between 2003 and 2007—from 10.8 percent to 21.3 percent—despite a low-income subsidy that all dual-eligibles and many other low-income beneficiaries receive to limit their out-of-pocket costs.

"Of particular concern are the high and, in some cases, rising rates of unmet prescription drug needs among the most vulnerable Medicare beneficiaries," said HSC Senior Researcher Jim Reschovsky, Ph.D., coauthor of the study with HSC Senior Researcher Laurie E. Felland, M.S. HSC is a nonpartisan health policy research organization funded in part by the Robert Wood Johnson Foundation, which funded the survey and the study.

"Although the new Medicare drug benefit reduced cost burdens for many, the structure of the benefit—the coverage gap, or so-called doughnut hole, and the ability of private drug plans to affect access through deductibles, cost sharing and drug formularies—means out-of-pocket spending for prescription drugs can vary considerably and depends on specific drug choices physicians make for beneficiaries," Reschovsky said.

The variation in access to prescription drugs across elderly Medicare beneficiaries reflects differences in the source of their drug coverage and differences in age, health and income. Under the Medicare drug benefit, known as Part D, beneficiaries can obtain creditable drug coverage from an employer or union plan that is at least comparable to the Part D standard benefit, obtain drug coverage through a private Medicare Advantage plan, enroll in a stand-alone prescription drug plan (PDP), or go without coverage.

The study’s findings are detailed in a new HSC Tracking Report—Access to Prescription Drugs for Medicare Beneficiaries—available here. Other key findings include:

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The Center for Studying Health System Change is a nonpartisan policy research organization committed to providing objective and timely research on the nation’s changing health system to help inform policy makers and contribute to better health care policy. HSC, based in Washington, D.C., is funded principally by the Robert Wood Johnson Foundation and is affiliated with Mathematica Policy Research, Inc.