The Effects of Medicare Part D on Health Outcomes of Newly Covered Medicare Beneficiaries

Objectives: To estimate the impact of Medicare Part D on cost-related prescription nonadherence and health outcomes among the newly covered medicare beneficiaries. Method: Difference-in-differences analyses of data from a balanced panel of Medicare beneficiaries observed in each wave of the Health and Retirement Study from 2000 to 2010 were carried out. The differences in the pre- and post-Part D changes in these outcomes are calculated for previously uncovered Part D enrollees and a comparison group of previously covered Medicare beneficiaries. Results: The results from this analysis indicate that Part D reduced cost-related nonadherence rates among the newly covered by 7 percentage points and that this decline was sustained through 2010. Part D was also associated with a 5 percentage points increase in the likelihood that a newly covered enrollee reported to be in good or better health and a 4-percentage point decline in the likelihood of being diagnosed with high blood pressure. These improvements were also sustained through 2010 but were only evident among those newly covered beneficiaries who remained enrolled in a Part D plan through 2010. However, there is insufficient evidence to conclude that Part D improved the blood pressure of newly covered, hypertensive beneficiaries. Discussion: Part D has had a sustained impact on cost-related nonadherence rates and the health status of newly covered beneficiaries. However, the change in health status is conditional on remaining enrolled in a Part D plan over time.