Medicare Part D has reduced the elderly mortality rate by 2.2% each year.
Medicare Part D has increased access to prescription drugs for elderly Americans, and improved patient outcomes, according to a study published by the Journal of Health Economics. For the study, the authors discovered that implementing the prescription drug benefit has reduced the mortality rate of elderly adults.
The investigators reported that since it was first created in 2006, Medicare Part D has driven down the elderly mortality rate by 2.2% each year.
“A big question in health economics is ‘Do public health insurance programs improve people’s health?’” said researcher Julian Reif, PhD. “You would think the answer would be obvious, but it’s a hard thing to prove. This paper provides strong evidence that health insurance programs improve health, and that reducing the price of medical care also improves health.”
In the study, the authors compared the mortality rate of the young elderly — age 66 – who have been eligible for Part D for at least 1 year, and the near elderly – age 64 – who were not eligible to enroll.
“The analysis in the paper is very simple: People over the age of 65 are almost universally eligible for Medicare, people under age 65 are not,” Dr Reif said. “The paper looks at changes in the mortality rate of people just over age 65 versus people just under age 65. We looked at it before and after Medicare Part D came online.”
The authors discovered a 2.2% annual reduction in mortality among young elderly individuals compared with nearly elderly individuals. This reduction was largely driven by a 4.4% decrease in cardiovascular death, according to the study.
“It fits in this more general question about the efficacy of public health insurance programs in improving our health,” Dr Reif said. “There are other papers that look at Medicare and Medicaid, and their effect on public health. This paper is the first to look at Medicare Part D.”
The Part D benefit is popular among Medicare beneficiaries, with a large proportion of patients enrolling in the program. Currently, there are 39 million beneficiaries enrolled in Part D, which spends more than $70 billion each year. The expansive population allowed researchers to detect the full effects of Part D. The authors looked at cause-of-death mortality records for the population, which let them accurately measure mortality.
The authors found that the reduction in mortality was associated with a social value reduction of $5 billion annually, according to the study. Combining their findings with previous studies evaluating the non-health benefits, the authors found that the total benefit was $20 billion annually.
“There’s certainly more to health than how long you live,” Dr Reif said. “We look at mortality because it’s easy to measure. But you take prescription drugs not just to live longer but also to relieve pain or to manage symptoms. There are quality-of-life benefits as well that come from health care; it’s just harder to measure those. But it’s reasonable to think that if you’re finding mortality effects there are drugs that are also making useful quality-of-life improvements, as well. To really evaluate whether what we spent on it was worth it, you really want to take into account all those things.”
The Part D program was initially criticized, on the belief that it would only benefit the pharmaceutical industry, while others said it would provide the most benefits to patients, according to the study. However, some individuals, including President Donald Trump, still feel that spending on prescription drugs is too high. President Trump has suggested negotiating drug prices for Medicare to drive down spending.
“I think the paramount concern is what has been the effect on people’s health,” Dr Reif said. “The more we improve people’s health, the more we should be OK with spending $70 billion per year on Medicare Part D. Regardless of whether you think we’re overpaying pharmaceutical companies for drugs, it does appear to be improving people’s health. It should be comforting to know that we’re at least getting some results.”
These findings could be used by legislators to inform decisions regarding Medicare Part D funding and rules after the Affordable Care Act is replaced. Overall, the authors found that Part D has greatly benefited the population and driven down mortality.
“This matters because we spend a lot of money on social insurance programs like Medicaid and Medicare, and one of the major justifications for social insurance programs like Medicare and Medicaid is that they save lives and actually improve people’s health,” Dr Reif concluded. “So I think it’s important to know that there’s evidence that these programs really work to reduce mortality.”