PART D "DOUGHNUT HOLE" EFFECT DRIVES UP GENERIC Rx DEMAND

FEBRUARY 01, 2008

Seniors who spend enough on prescription drugs to wind up in the Medicare Part D program's "doughnut hole" coverage void have been fueling the upsurge in generic drug usage in an effort to reduce their out-of-pocket medication costs, according to a new research study. The so-called doughnut hole—a lapse in Medicare Part D coverage for seniors after their annual prescription drug costs reach $2400—affected 4.2 million people in 2006, according to the study by researchers at Wolters Kluwer.

Although many seniors relied on generic drugs to reduce their prescription expenses even before the new Medicare program began, those now facing the Part D coverage gap are becoming even more focused on generics, the analysis found.

An estimated 59.6% of all Part D prescriptions were filled by generic drugs during 2006, but by the first quarter of 2007, the latest government figures show the rate of generic usage by Medicare patients had climbed to 61.5%—a jump that the researchers attributed to the doughnut hole effect.



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