Study: More Ailments Mean More Savings for Medicare Drug Beneficiaries

Medicare beneficiaries with one chronic medical condition can save about $400 a year on average with the new Medicare drug benefit, while beneficiaries with four or more chronic medical conditions can save $1,774, according to a National Health Council report released Thursday.

Of the Medicare beneficiaries studied in the report, 86 percent had at least one chronic condition, while 66 percent had two or more and 40 percent had three or more. Chronic conditions among Medicare beneficiaries include heart disease, Alzheimer’s and arthritis.

The report focused on Medicare beneficiaries who are deciding whether to enroll in the new benefit, which began Jan. 1. The study did not focus on beneficiaries who have drug coverage as part of an employer plan. Nor did the study include “dual eligibles,” Medicare beneficiaries who also qualify for Medicaid, the joint federal-state health insurance program for the poor.

On Jan. 1, about 6 million of these “dual eligibles” were transferred to private insurance plans offering drug coverage, and thousands have reported problems with getting the prescriptions they need. Administration officials have acknowledged the problems and have said they are taking a variety of steps to fix them. (See related story, CQ HealthBeat, Jan. 17)

The report, which analyzed data from the Centers for Medicare and Medicaid Services, found that beneficiaries with a single chronic condition on average spend more than $1,500 on prescription drugs and beneficiaries with four or more conditions spend more than $4,200 annually. Nearly a third of beneficiaries who have four or more chronic conditions spend more than $5,100 a year on their medications, qualifying them for the catastrophic coverage under the new drug law (PL 108-173), the study found.