Private provision of social insurance: drug-specific price elasticities and cost sharing in Medicare Part D.
Ontology highlight
ABSTRACT:
SUBMITTER: Einav L
PROVIDER: S-EPMC6141206 | biostudies-literature | 2018 Aug
REPOSITORIES: biostudies-literature
Publications
Private provision of social insurance: drug-specific price elasticities and cost sharing in Medicare Part D.
Einav Liran L Finkelstein Amy A Polyakova Maria M
American economic journal. Economic policy 20180801 3
We explore how private drug plans set cost-sharing in the context of Medicare Part D. While publicly-provided drug coverage typically involves uniform cost-sharing across drugs, we document substantial heterogeneity in the cost-sharing for different drugs within privately-provided plans. We also document that private plans systematically set higher consumer cost sharing for drugs or classes associated with more elastic demand; to do so we estimate price elasticities of demand across more than 15 ...[more]
Similar Datasets
Project description:To slow the growth of Medicare spending, some policy makers have advocated raising the Medicare eligibility age from the current sixty-five years to sixty-seven years. For the majority of affected adults, this would delay entry into Medicare and increase the time they are covered by private insurance. Despite its policy importance, little is known about how such a change would affect national health care spending, which is the sum of health care spending for all consumers and payers-including governments. We examined how spending differed between Medicare and private insurance using longitudinal data on imaging and procedures for a national cohort of individuals who switched from private insurance to Medicare at age sixty-five. Using a regression discontinuity design, we found that spending fell by $38.56 per beneficiary per quarter-or 32.4 percent-upon entry into Medicare at age sixty-five. In contrast, we found no changes in the volume of services at age sixty-five. For the previously insured, entry into Medicare led to a large drop in spending driven by lower provider prices, which may reflect Medicare's purchasing power as a large insurer. These findings imply that increasing the Medicare eligibility age may raise national health care spending by replacing Medicare coverage with private insurance, which pays higher provider prices than Medicare does.
| S-EPMC4943661 | biostudies-literature
Project description:Importance:The 2019 federal Ending the HIV Epidemic initiative requires a vast expansion of access to antiretroviral therapy (ART) and preexposure prophylaxis (PrEP) for HIV treatment and prevention. However, high prices for ART and PrEP can reduce their affordability and use. Medicare covers 1 in 4 persons living with HIV, and the Medicare Part D drug benefit imposes complicated cost-sharing between patients and other stakeholders. Objective:To determine how the Medicare Part D design distributes the cost burden for ART and PrEP between patients, insurance plans, manufacturers, and Medicare. Design and Setting:Nationwide cross-sectional analyses of first quarter 2019 Medicare formulary and pricing files for 3326 Part D plans were performed. These files contain drug benefit data, including prices and cost-sharing requirements. Main Outcomes and Measures:For 18 ART and 2 PrEP regimens, the out-of-pocket costs for patients and the cost borne by plans, manufacturers, and Medicare were projected for 1 year of treatment or prevention under a 2019 standard Medicare Part D insurance plan. Analyses assumed that patients used the ART or PrEP regimen and no other medications. Results:In 2019, ART prices ranged from $24?010 to $46?770 annually (median price, $35?780), with patients projected to pay 9% to 14% of the cost ($3270-$4350), insurance plans 18% to 24% ($5340-$8450), manufacturers 6% to 11% ($2370-$2750), and Medicare 53% to 67% ($12?770-$31?270). The price of PrEP was $20?570 annually, with patients contributing 15% ($2990), insurance plans 22% ($4570), manufacturers 13% ($2750), and Medicare 50% ($10?260). For beneficiaries with low-income subsidies that cover all patient cost-sharing, Medicare would assume 67% to 76% of ART costs and 65% of PrEP costs. Conclusions and Relevance:Medicare Part D mandates universal ART and PrEP coverage, but high prices (>$35?000 annually for ART and>$20?000 annually for PrEP) and the design of Part D can jeopardize affordability for patients and place most of the cost burden on taxpayers. Under a standard Medicare Part D benefit, patients pay $3000 to $4000 out-of-pocket yearly, unless they qualify for low-income subsidies, and half to two-thirds of the cost of ART and PrEP is borne by Medicare rather than insurance plans or manufacturers. To end the HIV epidemic by 2030, it appears that policies must address both high drug prices and revamp Medicare Part D cost-sharing.
| S-EPMC7156991 | biostudies-literature
Project description:ObjectivesTo determine the magnitude and mechanisms of response to Medicare Part D cost sharing by low-income subsidy (LIS) recipients using oral hypoglycemic agents (OHAs) and statins.Data sourcesMedicare data for a 5 percent random sample of beneficiaries with diabetes enrolled in fee-for-service Part D drug plans in 2008.Study designWe evaluated the impact of differences between generic and brand cost sharing rates among cohorts of LIS and non-LIS recipients to determine if wider price spreads increased the generic dispensing rate (GDR) and reduced total drug use and cost.Principal findingsWe found little association between cost sharing and aggregate OHA and statin use. In adjusted analyses, non-LIS beneficiaries who paid 46 percent of total OHA costs had 2.5 percent fewer OHA days supply than full benefit dual eligibles who paid just 5 percent of their therapy costs. For statins, the difference in days supply between those facing the lowest and highest cost sharing was 4.6 percent. Higher cost sharing was associated with filling fewer but larger prescriptions for both generics and brands.ConclusionsHigher generic and brand copays had little association with OHA and statin use among LIS recipients. This implies that modest changes in required cost sharing for these medicines would have very little substantive impact on generic dispensing or utilization patterns among LIS recipients and thus would have little effect on total program spending. At the same time, any increases in out-of-pocket costs would be expected to shift costs and place greater financial burden on low-income beneficiaries, particularly those in poor health.
| S-EPMC5441476 | biostudies-literature
Project description:BackgroundModels of health care coverage with varying degrees of patient cost-sharing have been shown to influence health care behaviors for chronic conditions including medication adherence. The effect of insurance cost-sharing subsidies on the probability of postoperative opioid refill, however, is unclear.MethodsThis retrospective cohort study examined 100% Medicare claims data among patients (N = 21,781) ages 65 and older undergoing orthopedic procedures in Michigan between January 2013 and September 2016. Patients were classified based on the presence of low-income subsidy and on prior opioid exposure using Medicare Part D prescription files of drug events. We investigated the association of these factors with the probability of both initial and second postoperative opioid fill within 90 days from the date of discharge.ResultsIn this cohort, 84.6% of patients filled an initial opioid prescription, and 66.4% refilled an opioid prescription. Patients with a full low-income subsidy had greater odds of refill within the postoperative 90 days compared with those patients without a low-income subsidy (odds ratio 1.38, 95% confidence interval 1.18-1.60). Among opioid naïve patients with a full low-income subsidy, the adjusted refill rate was 61.3% (95% confidence interval 58.0-64.7%) compared with 57.6% (95% confidence interval 51.4-63.7%) among those with partial low-income subsidy and 54.2% (95% confidence interval 52.8-55.6%) among patients without low-income subsidy.ConclusionAmong Medicare patients undergoing orthopedic procedures, a full medication subsidy is associated with an increased probability of opioid refill when compared with no subsidy. Going forward, it is critical to lessen financial barriers to ensure all patients have equitable access to postoperative analgesia, including both opioid and nonopioid analgesics by decreasing the patient burden of cost-sharing.
| S-EPMC8489972 | biostudies-literature
Project description:BackgroundAlthough the Medicare Part D coverage gap phase-out should reduce cost-related nonadherence (CRN) among seniors with diabetes, preferential generic prescribing may have already decreased CRN, while smaller numbers of patients using more costly branded oral anti-diabetic (OAD) medications remain vulnerable to CRN.ObjectiveTo estimate the effects of cost sharing in the Part D standard (non-LIS) benefit on adherence to different OAD classes, comparing two classes dominated by inexpensive generic medications and two by more costly branded medications.Design and patientsRetrospective cohort study using dispensed prescription data for elderly non-LIS (N=81,047) and LIS (low-income subsidy) (N=150,359) beneficiaries using same class OAD(s) in 2008 and 2009. Logistic regression modeled non-LIS likelihood; LIS and non-LIS patients matched using propensity outcome (N=38,054). Logistic regression, controlling for demographic and health status characteristics, modeled effects of non-LIS coverage on 2009 OAD class adherence.Main measuresMain outcome measures were within-class OAD coverage year adherence, with patients considered adherent when days supplied to calendar days ratio at least 0.8.Key resultsNon-LIS patients had 0.52 and 0.57 times the odds of branded-only DPP-4 Inhibitor (N=1,812; 95 % CI: 0.43, 0.63; P<0.001) and Thiazolidinedione (TZD) (N=6,290; 95 % CI: 0.52, 0.63; P<0.001) adherence. Most patients (N=32,510; 82 %) used OADs in primarily generic classes, where we found no significant (Biguanides; N=21,377) or small differences (Sulfonylureas/Glinides [N=19,240; OR: 0.91; 95 % CI: 0.86, 0.97; P=0.002]) in adherence odds. Crude adherence rates were sub-optimal when CRN was not a factor (Non-LIS/LIS: Biguanides: 65 %/65 %; Sulfonylureas/Glinides: 66 %/68 %; LIS: DPP-4 Inhibitors: 66 %; TZDs: 67 %).ConclusionsGap elimination would not affect generic, but should reduce branded OAD CRN. Branded copayments may continue to lead to CRN. Policy initiatives and benefit changes targeting both cost deterrents for patients with more complex disease and non-cost generic OAD underuse are recommended.
| S-EPMC3682054 | biostudies-literature
Project description:ImportanceThe US Department of Health and Human Services (HHS) has proposed to reform drug pricing in Medicare Part B, which primarily covers physician-administered drugs and biologic agents. One HHS proposal would shift coverage of certain drugs from Medicare Part B to Part D, which is administered by private prescription drug plans.ObjectiveTo estimate the association of changes of a shift in Medicare Part B to Part D with total drug spending and patient cost-sharing.Design, setting, and participantsRetrospective drug cohort study of the 75 brand-name drugs associated with the highest Part B expenditures among fee-for-service Medicare beneficiaries in 2016.Main outcomes and measuresEstimated total Medicare spending in Part B and Part D; annual out-of-pocket costs in Part B and under the standard 2018 Part D benefit; and proportion of drugs in Part D's protected drug classes (immunosuppressants for prophylaxis of organ transplant rejection, antidepressants, antipsychotics, anticonvulsants, antiretrovirals, and antineoplastics).ResultsAt 2018 prices, total Medicare Part B spending for the 75 brand-name drugs with the highest Part B expenditures was estimated to be $21.6 billion annually. Under the proposed policy, total Part D drug spending for these drugs was estimated to range between $17.6 billion and $20.1 billion after rebates, corresponding to a 6.9% to 18.3% decrease in drug spending in Part D compared with Part B. Of the 75 drugs studied, 33 (44.0%) drugs, accounting for $9.5 billion (43.9%) in Part B spending, were in protected Part D classes where plans must cover essentially all drugs. For 67 drugs with available information, the prices for 65 (97.0%) were a median of 45.8% to 59.7% lower in comparator high-income countries than Part B drug prices. Median patient cost-sharing in Part B for all 75 brand-name drugs was $4683 (interquartile range [IQR], $1069-$9282) per year. Shifting Part B drugs to the 2018 standard Part D benefit was projected to decrease out-of-pocket costs by a median of $860 (IQR, -$3884 to $496) among Medicare beneficiaries without Medicaid or Part B supplemental insurance (Medigap). For beneficiaries who would qualify for the low-income subsidy program in Part D, cost-sharing would be lower in Part D than in Part B for all drugs. For beneficiaries with Medigap insurance, estimated Part D out-of-pocket costs exceeded average Medigap premium costs by a median of $1460 for those with Part D coverage and by a median of $1952 for those without Part D coverage.Conclusions and relevanceAlthough the HHS proposal to shift certain drugs from Medicare Part B to Part D may reduce total drug spending, it may increase out-of-pocket costs for some Medicare beneficiaries, including those with Medicare supplement insurance. The Department of Health and Human Services should ensure that the proposed reforms benefit both patients and payers.
| S-EPMC6439690 | biostudies-literature
Project description:The Affordable Care Act (ACA) required most insurers and the Medicare program to eliminate cost sharing for screening mammography.We conducted a difference-in-differences study of biennial screening mammography among 15,085 women 65 to 74 years of age in 24 Medicare Advantage plans that eliminated cost sharing to provide full coverage for screening mammography, as compared with 52,035 women in 48 matched control plans that had and maintained full coverage.In plans that eliminated cost sharing, adjusted rates of biennial screening mammography increased from 59.9% (95% confidence interval [CI], 54.9 to 65.0) in the 2-year period before cost-sharing elimination to 65.4% (95% CI, 61.8 to 69.0) in the 2-year period thereafter. In control plans, the rates of biennial mammography were 73.1% (95% CI, 69.2 to 77.0) and 72.8% (95% CI, 69.7 to 76.0) during the same periods, yielding a difference in differences of 5.7 percentage points (95% CI, 3.0 to 8.4). The difference in differences was 9.8 percentage points (95% CI, 4.5 to 15.2) among women living in the areas with the highest quartile of educational attainment versus 4.3 percentage points (95% CI, 0.2 to 8.4) among women in the lowest quartile. As indicated by the difference-in-differences estimates, after the elimination of cost sharing, the rate of biennial mammography increased by 6.5 percentage points (95% CI, 3.7 to 9.4) for white women and 8.4 percentage points (95% CI, 2.5 to 14.4) for black women but was almost unchanged for Hispanic women (0.4 percentage points; 95% CI, -7.3 to 8.1).The elimination of cost sharing for screening mammography under the ACA was associated with an increase in rates of use of this service among older women for whom screening is recommended. The effect was attenuated among women living in areas with lower educational attainment and was negligible among Hispanic women. (Funded by the National Institute on Aging.).
| S-EPMC5842919 | biostudies-literature
Project description:ObjectivesTo compare existing algorithms for classifying screening vs diagnostic colonoscopies and to quantify the increase in screening colonoscopy rates when Medicare began reimbursement in 2001 and when the Affordable Care Act (ACA) eliminated cost-sharing.Data sourcesTwenty percent random sample of fee-for-service (FFS) Medicare claims, 2000-2012.Study designUsing recent administrative codes as tarnished gold standards, we examined the sensitivity and specificity of five published algorithms for classifying colonoscopies and calculated annual screening colonoscopy rates. We estimated the change in rates after Medicare began reimbursement and used difference-in-differences analysis to estimate the effects of eliminating cost-sharing by comparing states with and without a mandate to cover screening colonoscopy prior to the ACA.FindingsModel-based algorithms have higher sensitivity (0.53-0.99) than expert-based algorithms (0.35-0.39), but lower specificity (0.43-0.65 vs 0.79-0.88). All algorithms detected increases in screening from both Medicare's reimbursement change (range: 24-93/10 000) and the 2011 cost-sharing change (range: 1.1-34/10 000). Difference-in-difference estimates of the ACA's effect varied from 51 to 155 tests per 10 000 depending on the algorithm.ConclusionsScreening colonoscopy rates increased after eliminating cost-sharing in 2011, but the increase's size varied depending on the algorithm used to classify the indication. Improvements are needed in Medicare coding for screening.
| S-EPMC6606542 | biostudies-literature
Project description:BackgroundThe costs associated with healthcare are of critical importance to both decision-makers and users, given the limited resources allocated to the health sector. However, the available scientific evidence on healthcare costs in low- and middle-income countries, such as Peru, is scarce. In the Peruvian context, the health system is fragmented, and the private health insurance and its financing models have received less research attention. We aimed to analyse user cost-sharing and associated factors within the private healthcare system.MethodsOur study was cross-sectional, using open data from the Electronic Transaction Model of Standardized Billing Data-TEDEF-SUSALUD, between 2021-2022. Our unit of analysis is the user's medical bills. We considered the total amount of cost-sharing, proportion of total payments as cost-sharing, and cost-sharing as a proportion of minimum salaries. We use a multiple regression model to perform the analyses.ResultsOur study included 5,286,556 health services provided to users of the private health insurance in Peru. We found a significant difference was observed in the cost-sharing for hospitalization-related services, with an average of 419.64 soles per day (95% CI: 413.44 to 425.85). Also, we identified that for hospitalization-related services per day is, on average, 0.41 (95% CI: 0.41 to 0.41) minimum salaries more expensive than outpatient care, although cost-sharing per day of hospitalization represent on average only 14% of the total amount submitted.ConclusionsOur study provides a detailed overview of cost-sharing in the private healthcare system in Peru and the factors associated with them. Policymakers can use the study's finding that higher cost-sharing for inpatient hospitalization compared to outpatient care in private insurance can create inequities in access to healthcare to design policies aimed at reducing these costs and promoting a more equitable and accessible healthcare system in Peru.
| S-EPMC11315335 | biostudies-literature
Project description:BackgroundEarly treatment of hepatocellular carcinoma (HCC) is associated with improved survival, but many patients with HCC do not receive therapy. We aimed to examine factors associated with HCC treatment and survival among incident patients with HCC in a statewide cancer registry.Materials and methodsAll patients with HCC from 2003 through 2013 were identified in the North Carolina cancer registry. These patients were linked to insurance claims from Medicare, Medicaid, and large private insurers in North Carolina. Associations between prespecified covariates and more advanced HCC stage at diagnosis (ie, multifocal cancer), care at a liver transplant center, and provision of HCC treatment were examined using multivariate logistic regression. A Cox proportional hazards model was developed to assess the association between these factors and survival.ResultsOf 1,809 patients with HCC, 53% were seen at a transplant center <90 days from diagnosis, with lower odds among those who were Black (adjusted odds ratio [aOR], 0.54; 95% CI, 0.39-0.74), had Medicare insurance (aOR, 0.35; 95% CI, 0.21-0.59), had Medicaid insurance (aOR, 0.46; 95% CI, 0.28-0.77), and lived in a rural area; odds of transplant center visits were higher among those who had prediagnosis alpha fetoprotein screening (aOR, 1.74; 95% CI, 1.35-2.23) and PCP and gastroenterology care (aOR, 1.66; 95% CI, 1.27-2.18). Treatment was more likely among patients who had prediagnosis gastroenterology care (aOR, 1.68; 95% CI, 0.98-2.86) and transplant center visits (aOR, 2.42; 95% CI, 1.74-3.36). Survival was strongly associated with age, cancer stage, cirrhosis complications, and receipt of HCC treatment. Individuals with Medicare (adjusted hazard ratio [aHR], 1.58; 95% CI, 1.20-2.09) and Medicaid insurance (aHR, 1.55; 95% CI, 1.17-2.05) had shorter survival than those with private insurance.ConclusionsIn this population-based cohort of patients with HCC, Medicare/Medicaid insurance, rural residence, and Black race were associated with lower provision of HCC treatment and poorer survival. Efforts should be made to improve access to care for these vulnerable populations.
| S-EPMC9899074 | biostudies-literature