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Ann Intern Med. 2008 Feb 5;148(3):169-77. Epub 2008 Jan 7.

The effect of the Medicare Part D prescription benefit on drug utilization and expenditures.

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  • 1Robert Wood Johnson Scholars in Health Policy Program, Harvard University, Cambridge, Massachusetts, USA.



Information about the effect of the Medicare Part D Prescription Drug Benefit on drug utilization and expenditures is limited.


To estimate changes in prescription utilization and out-of-pocket expenditures attributable to Part D among a sample of persons eligible for the benefit.


Generalized estimating equations were used to estimate changes in expenditures and utilization among beneficiaries. A control group was included to control for secular trends unrelated to the Part D benefit.


National pharmacy chain representing approximately 15% of all U.S. retail pharmacy sales.


Persons age 66 to 79 years (those eligible for Part D) and a control group of persons age 60 to 63 years (those ineligible for Part D). The final sample represented approximately 5.1 million unique beneficiaries and 1.8 million unique control individuals.


Prescription utilization (measured in pill-days) and out-of-pocket expenditures, as determined from pharmacy claims from September 2004 to April 2007.


During the penalty-free Part D enrollment period (January 2006 to May 2006), average monthly drug utilization increased by 1.1% (95% CI, 0.5% to 1.7%; P < 0.001) and out-of-pocket expenditures decreased by 8.8% (CI, 6.6% to 11.0%; P < 0.001). After enrollment stabilized (June 2006 to April 2007), average monthly drug utilization increased by 5.9% (CI, 5.1% to 6.7%; P < 0.001) and out-of-pocket expenditures decreased by 13.1% (CI, 9.6% to 16.6%; P = 0.003). Compared with eligible nonenrollees, enrollees had higher out-of-pocket expenditures and utilization at baseline but experienced significantly larger decreases in expenditures and increases in utilization after enrollment.


Analyses were limited to claims within 1 pharmacy chain. The effect of the "doughnut hole" and the effect of changes on clinical outcomes were not evaluated.


The Medicare Part D prescription benefit resulted in modest increases in average drug utilization and decreases in average out-of-pocket expenditures among Part D beneficiaries. Further research is needed to examine patterns among other beneficiaries and to evaluate the effect of these changes on health outcomes.

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