Dual Eligibles with Mental Disorders and Medicare Part D: How are They Faring

1
Dual Eligibles with Mental Disorders and Medicare
Part D How are They Faring?

• Julie Donohue
• University of Pittsburgh
• Haiden Huskamp
• Harvard Medical School
• Sam Zuvekas
• Agency for Healthcare Research and Quality

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Context

• 6 million Medicare beneficiaries dually eligible
  for Medicaid moved to Medicare Part D drug plans.
• Random assignment to one of multiple benchmark
  plans, can switch
• Estimated 60 of disabled and 20 of elderly
  dual-eligibles have mental disorders
• Protections
• All or substantially all rule for
  antidepressants, antipsychotics, and
  anticonvulsants
• Fixed copay for generics, slightly higher for
  branded drugs, cant use cost-sharing tiers
• Risk adjusted payments to PDPs

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Medication Use and Spending U.S. Community
Population
SOURCE Medical Expenditure Panel Survey
2005-2006
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Medication Use and Spending Medicare Community
Population
SOURCE Medical Expenditure Panel Survey
2005-2006
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Medication Use and Spending Dual Eligible
Community Population
SOURCE Medical Expenditure Panel Survey
2005-2006
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Formulary Coverage of Selected Atypical
Antipsychotics
SOURCE January 2006, 2007, and 2008 CMS
Prescription Drug Formulary and Pharmacy Network
Files
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Formulary Coverage of Selected Antidepressants
SOURCE January 2006, 2007, and 2008 CMS
Prescription Drug Formulary and Pharmacy Network
Files
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Use of Utilization Management Tools for Selected
Atypical Antipsychotics
SOURCE January 2006, 2007, and 2008 CMS
Prescription Drug Formulary and Pharmacy Network
Files
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Use of Utilization Management Tools for Selected
Antidepressants
SOURCE January 2006, 2007, and 2008 CMS
Prescription Drug Formulary and Pharmacy Network
Files
10
Percentage of Benchmark PDPs Requiring Either
Step Therapy or Prior Authorization for Any Drug
SOURCE January 2006, 2007, and 2008 CMS
Prescription Drug Formulary and Pharmacy Network
Files
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Other Findings from the Literature

• Medication Discontinuities
• Some evidence of problems accessing particular
  medications (Hall et al 2007 West 2007, 2009)
• Psychotropic Drug Prices
• Frank and Newhouse (2008) some evidence that
  prices for antipsychotics increased under Part D
• Plan Choice
• Most Dual Eligibles assigned randomly, few switch
  plans (11 in 2006, Neuman et al. 2007)
• Reduction in the Number of Benchmark Plans
• 409 plans in 2006 gt 308 in 2009
• 2009 Six states have lt5 plans, Nevada has 1

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Summary and Implications Out-of-Pocket Costs

• Major Change in Financing of Psychotropic
  Medications
• Out of pocket costs decreased for non
  dual-eligibles
• Out of pocket costs flat for dual-eligibles
• Some indirect evidence of medication
  discontinuities

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Summary and Implications Formulary Coverage

• Formulary coverage relatively generous
• But gaps for some formulations
• Increasing use of utilization management
• Consider monitoring prior authorization approval
  rates, include in plan performance
• Consider alternatives to random assignment

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Summary and Implications PDP Market

• PDPs exiting from market
• Limits choice
• Reassignment may lead to medication
  discontinuities
• Doubling of PDP risk corridors in 2008 exposes
  plans to greater risk and may lead to further
  plan exits if risk adjustment doesnt accurately
  reflect dual eligibles expected costs
• Consider changes in risk adjustment systems to
  include drug utilization
• Consider exposing PDPs to less risk for
  dual-eligibles

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More Information

• Donohue, Julie M, Haiden A. Huskamp and Samuel H.
  Zuvekas. 2009. Dual Eligibles with Mental
  Disorders and Medicare Part D How Are They
  Faring? Health Affairs 28(May/June) 746-759.