Health insurance and the elderly: data from MCBS (Medicare Current Beneficiary Survey)

This article shows the supplemental insurance distribution and Medicare spending per capita by insurance status for elderly persons in 1991. The data are from the Medicare Current Beneficiary Survey (MCBS) and Medicare bill records. Persons with Medicare only are a fairly small share of the elderly (11.4 percent). About three-fourths of the Medicare elderly have some form of private insurance. The share with Medicaid is 11.9 percent, which has increased recently as qualified Medicare beneficiaries (QMBs) started to receive partial Medicaid benefits. In general, Medicare per capita spending levels increase as supplemental insurance comes closer to first dollar coverage. When the data were recalculated to control for differences in reported health status between the insurance groups, essentially the same spending differences were observed.     

Insurance Coverage of Prescription Drugs and the Rural Elderly

CONTEXT: Rural impacts of a Medicare drug benefit will ultimately depend on the number of elderly who are currently without drug coverage, new demand by those currently without coverage, the nature of the new benefit relative to current benefits, and benefit design. PURPOSE: To enhance understanding of drug coverage among rural elderly Medicare beneficiaries and their expenditures for pharmaceuticals. METHODS: Estimates of the extent of coverage, expenditures, and sources of drugs were obtained using data are from the 1997 Medicare Current Beneficiary Survey and the Pharmacy Verification and Household Components of the 1996 Medical Expenditure Panel Survey. FINDINGS: Three-quarters of the urban elderly had some type of drug coverage in 1997 versus 59% of the elderly in rural areas. Urban residents were more likely to have obtained their drug coverage from an employer-sponsored supplemental plan, and rural residents were more likely to have self-purchased Medigap drug coverage. Expenditures and use of drugs by Medicare beneficiaries are greater for those with than without coverage, and differences are invariant with respect to geographic location. Coverage under self-purchased supplemental plans appears less generous than under employer-sponsored plans in both rural and urban areas. Rural and urban elderly are more than twice as likely to receive at least 1 prescribed medication through the mail than the general population. CONCLUSION: A well-designed Medicare drug benefit would be especially beneficial to the rural elderly because relatively more rural elderly currently lack coverage or have less generous coverage than urban beneficiaries. Mail-order distribution may help contain future program expenditures.     

The demand for preventive and restorative dental services among older adults

Many older Americans have poor access to dental care, resulting in a high prevalence of oral health problems. Because traditional Medicare does not include dental care benefits, only older Americans who are employed, have post‐retirement dental benefits or spousal coverage, or enroll in certain Medicare Advantage plans are able to obtain dental care coverage. We seek to determine the extent to which poor access to dental insurance and high out‐of‐pocket costs affect dental service use by the elderly. Using the 2007–2015 Medical Expenditure Panel Survey and supplemental data on dental care prices, we estimate a demand system for preventive dental services and basic and major restorative services. Selection into dental and medical insurance is addressed using a correlated random effects panel data specification. Consistent with prior studies of the nonelderly population, dental service use was not sensitive to out‐of‐pocket prices. However, private dental insurance increased preventive service use by 25%, and dental coverage through Medicaid increased basic and major service use by 23% and 36%, respectively. The use of services was more responsive to dental insurance for women than men. These estimates suggest that a Medicare dental benefit could significantly increase dental service use by older Americans.     

Racial/ethnic disparities in the use of preventive services among the elderly

OBJECTIVES: Minorities have worse health outcomes compared to whites, which are partially explained by racial/ethnic disparities in use of health services. Less well known, however, are whether these disparities persist among the elderly, the only group that possesses near universal health insurance coverage by Medicare, and how variation in Medicare coverage affects the receipt of preventive services. The scope of racial/ethnic disparities in the use of preventive services in the elderly was assessed, and the impact of the type of health insurance coverage on the use of preventive services was measured. METHODS: Data were derived from the 2001 California Health Interview Survey, a random-digit-dial population-based survey, collected between November 2000 and October 2001. Analysis for this project was conducted in 2004. The association of race/ethnicity and type of health insurance with receipt of preventive services was assessed using bivariate and multivariate logistic regression models. RESULTS: African Americans and Latinos were significantly less likely to be vaccinated for influenza, and Asian Americans were significantly less likely to obtain a mammogram compared to whites, while controlling for other explanatory factors. Moreover, those with Medicare plus Medicaid coverage were significantly less likely to use all four preventive services compared to those with Medicare plus private supplemental insurance. CONCLUSIONS: Despite near-universal coverage by Medicare, racial/ethnic disparities in the use of some preventive services among the elderly persist. Further research should focus on identifying potential cultural and structural barriers to receipt of preventive services aimed at designing effective intervention among high-risk groups.     

Adverse selection and the purchase of Medigap insurance by the elderly

This study uses data on 8561 elderly respondents from the 1991 Medicare Current Beneficiary Survey to examine adverse selection in the supplemental private insurance market. Logit models of supplemental insurance choices provided modest but mixed evidence of self-selection on the basis of observable health status. Wealth had a strong influence on coverage. Two part models of Medicare utilization and expenditures showed that beneficiaries with individually purchased policies had higher total, part B and physician expenditures than those with employer-provided policies, even after controlling for observable differences, suggesting adverse selection. Results were similar for basic and more comprehensive policies.     

Incentive and selection effects of Medigap insurance on inpatient care

The Medicare program, which provides insurance coverage to the elderly in the United States, does not protect them fully against high out-of-pocket costs. For this reason private supplementary insurance, named Medigap, has been available to cover Medicare gaps. This paper studies how Medigap affects the utilization of inpatient care, separating the incentive and selection effects of supplementary insurance. For this purpose, we use two alternative estimation methods: a standard recursive bivariate probit and a discrete multivariate finite mixture model. We find that estimated incentive effects are modest and quite similar across models. There seems to be very significant selection, with the presence of both adversely and advantageously selected individuals, stemming from the multidimensional nature of residual heterogeneity.     

Does supplemental private insurance affect care of Medicare recipients hospitalized for myocardial infarction?

OBJECTIVES: We sought to determine whether supplemental private insurance coverage among Medicare recipients alters patterns of health care or outcomes associated with acute myocardial infarction. METHODS: Medicare patients hospitalized after a myocardial infarction were identified from New York City hospitalization records. Patients who had only Medicare coverage were compared with those who had supplemental private or public insurance coverage. RESULTS: Patients with supplemental private insurance exhibited increased rates of revascularization and decreased rates of in-hospital mortality relative to patients with either Medicare only or Medicare and public insurance. Moreover, Blacks and women were less likely to undergo revascularization and exhibited higher in-hospital mortality rates. CONCLUSIONS: Despite Medicare, private insurance coverage appears to influence the likelihood of coronary revascularization among older patients hospitalized for acute myocardial infarction.     

Sensitivity of Medication Use to Formulary Controls in Medicare Beneficiaries: A Review of the Literature

Background

Several studies have examined the impact of formulary management strategies on medication use in the elderly, but little has been done to synthesize the findings to determine whether the results show consistent trends.

Objective

To summarize the effects of formulary controls (ie, tiered copays, step edits, prior authorization, and generic substitution) on medication use in the Medicare population to inform future Medicare Part D and other coverage decisions.

Methods

This systematic review included research articles (found via PubMed, Google Scholar, and specific scientific journals) that evaluated the impact of drug coverage or cost-sharing on medication use in elderly (aged ≥65 years) Medicare beneficiaries. The impact of drug coverage was assessed by comparing patients with some drug coverage to those with no drug coverage or by comparing varying levels of drug coverage (eg, full coverage vs $1000 coverage or capped benefits vs noncapped benefits). Articles that were published before 1995, were not original empirical research, were published in languages other than English, or focused on populations other than Medicare beneficiaries were excluded. All studies selected were classified as positive, negative, or neutral based on the significance of the relationship (P <.05 or as otherwise specified) between the formulary control mechanism and the medication use, and on the direction of that relationship.

Results

Included were a total of 47 research articles (published between 1995 and 2009) that evaluated the impact of drug coverage or cost-sharing on medication use in Medicare beneficiaries. Overall, 24 studies examined the impact of the level of drug coverage on medication use; of these, 96% (N = 23) supported the association between better drug coverage (ie, branded and generic vs generic-only coverage, capped benefit vs noncapped benefit, supplemental drug insurance vs no supplemental drug insurance) or having some drug coverage and enhanced medication use. Furthermore, 84% (N = 16) of the 19 studies that examined the effect of cost-sharing on medication use demonstrated that decreased cost-sharing was significantly associated with improved medication use.

Conclusion

Current evidence from the literature suggests that restricting drug coverage or increasing out-of-pocket expenses for Medicare beneficiaries may lead to decreased medication use in the elderly, with all its potential implications.Patient access to healthcare resources is an important topic of healthcare discussion, research, and reform in the United States.1,2 Access issues are usually framed in the context of patients having health insurance, as the quality of health insurance facilitates patient access to necessary medical and pharmaceutical therapies.2 Although patient access to medications is essential, formulary management strategies may introduce barriers aimed at restricting utilization, including curbing patient demand by increasing the cost borne by the patient or providing incentives to select lower-cost alternatives. Examples of these strategies include tiered copays, coinsurance, and benefit caps.3,4

KEY POINTS

• ▸ Many studies have investigated the impact of formulary management (eg, tiered copays, step edits, prior authorization) on medication use (eg, adherence, change in days supply, medication fills) patterns in Medicare beneficiaries, but none has synthesized the findings to arrive at some common trends in this patient population.
• ▸ The present study reviewed 47 studies that had met the study criteria involving medication use by Medicare beneficiaries between 1995 and 2009.
• ▸ Among the 24 studies that investigated the impact of drug coverage on medication use, 23 showed that elderly patients with greater drug coverage are more likely to use their medications as prescribed than those with greater coverage restrictions.
• ▸ Of the 19 studies that examined the effect of cost-sharing on medication use, 16 demonstrated that decreased patient cost-sharing improved medication use.
• ▸ Overall, the evidence shows that more restrictive drug coverage is associated with reduced medication use among Medicare beneficiaries, and fewer restrictions encourage enhanced medication use.
• ▸ Health plans are facing increasing pressures to implement strategies to control costs, including drug costs; nevertheless, restricting access to necessary medications in the elderly may lead to suboptimal clinical outcomes and potentially greater medical expenditures.

The advent of Medicare Part D in 2006 made the federal government the single largest payer of medications in the country, providing coverage to Medicare beneficiaries and the disabled. Although Part D is sponsored by the Centers for Medicare & Medicaid Services (CMS), it is administered by health plans that have the ability to implement restrictions on medication use in the form of drug benefit. Evidence generated from previous studies demonstrate that formulary controls can impact patients'' medication-taking behavior and, ultimately, patient outcomes.4 However, conclusions drawn from these studies were largely based on populations that included nonelderly, commercial, or non-US populations.4 Elderly people could behave differently from younger people in response to formulary controls, given their increased likelihood of comorbidities and greater need for medications to maintain good health.No study to date has collated existing data to assess the consistency in the findings regarding the impact of formulary controls on medication use—defined in this current study as adherence, change in days supply, medication fills, and number of tablets—in the elderly. Synthesizing evidence from previous studies involving elderly populations may help in assisting Medicare and other health plan benefit design guidelines in the future.Therefore, the objective of this study was to summarize the effects of formulary controls on the US elderly (ie, Medicare) population based on previously published studies to generate evidence using earlier research that could be used to make future coverage decisions. Formulary controls included all formulary strategies that use mechanisms such as formulary restrictions and benefit design, including tiered copayments, step edits, prior authorization, and generic substitution.     

Service use and costs for Medicare beneficiaries in risk-based HMOs and CMPs: some interim results from the National Medicare Competition Evaluation.

The Health Care Financing Administration (HCFA) initiated the Medicare Competition Demonstration in 1982 in anticipation of congressional intent to establish a national program. Interim results on the 1984 service use and cost experience of the health maintenance organizations (HMOs) and competitive medical plans (CMPs) participating in the demonstrations indicate that Medicare enrollees in the demonstration experienced a median of 1,951 hospital days per 1,000 person years, 57 per cent of the median of 3,432 days per 1,000 in the local markets from which the plans drew enrollment. Independent practice association (IPA) HMOs experienced higher hospital use rates than staff and group model HMOs. These comparisons are not adjusted for various risk factors, the absence of which were likely to favor the demonstration plans. Plans with lower hospital service use were federally qualified and had been operating for more than five years. The median total annual revenue per enrollee across all plans was $2,312, compared to median annual expenses per enrollee of $2,250. The distribution of median annual expenses per enrollee by major category of expense was: institutional expenses ($1,038/enrollee), medical expenses ($720/enrollee), supplemental services expenses ($154/enrollee), and administrative and other expenses ($295/enrollee). Future analysis, using beneficiary-level data, will examine the impact of the demonstration and the nature and extent of evident biased selection and will compare the quality of care in the demonstrations to that in the fee-for-service sector.     

A survey of mental health service coverage within health maintenance organizations.

This 1978 national survey of all operating Health Maintenance Organizations (HMOs) provided information on the current status of mental health services utilization and service coverage within HMOs. It achieved a 68 per cent response rate. Approximately 90 per cent (108) of the HMOs offered mental health services through basic or supplemental coverage plans; HMO organization characteristics reflected relative heterogeneity; the mean monthly costs for basic health plan coverage (physical and mental health services) were $33.85 (for individuals) and $95.15 (for families); HMOs reported lower physical and mental health hospital utilization and higher ambulatory utilization when compared to more traditional forms of health insurance coverage. The present coverage and uitlization of mental health services within HMOs reflect greater variability of benefits and utilization within HMOs. There is need for further studies of mental health utilization in relation to organizational structure and delivery pattern relationships within HMOs.