Understanding the outpatient medication use and spending of cognitively impaired older adults under changing Medicare Part D policy

Abstract

BackgroundBetween 2011 and 2020, the Affordable Care Act progressively closed the Medicare Part D coverage gap, reducing coinsurance from 100% to 25% to alleviate financial burdens and improve prescription drug access. Individuals with cognitive impairment face particularly high drug costs and are at greater risk for medication discontinuation. Furthermore, adherence is essential in this population for managing their disease and comorbidities to reduce their healthcare use and expenditures. We evaluated the effect of reduced coinsurance on out-of-pocket (OOP) costs and medication use for beneficiaries with cognitive impairment, as well as the association between medication adherence and inpatient (IP) and emergency department (ED) related healthcare costs and visits. MethodsThe study sample was Health and Retirement Study respondents with cognitive impairment, linked to Medicare claims (2006-2018). Aim 1 evaluated the causal effect of coverage gap closure on Part D OOP spending using a difference-in-differences (DID) event study approach. Aim 2 assessed the causal effect of coverage gap closure on medication use with a DID analysis. For these two aims, we estimated the change in the outcome for non-low-income subsidy (LIS) respondents, as compared to LIS respondents, who were not subject to the coverage gap. Aim 3 examined the association between adherence to AD medication and IP and ED utilization and costs using two-part models. ResultsClosure of the coverage gap resulted in a significant reduction in annual OOP spending (2011 vs. 2010: -$134; 95% CI: -174 to -94; p<0.001) in beneficiaries with cognitive impairment and in an increase in the probability of AD medication use in those with ADRD (4.3 percentage points [ppts]; 95% CI: 1.2-7.4; p=0.017). In terms of healthcare resource utilization and cost, adherence to AD drugs was associated with significant reductions in the probability of incurring IP (-2.4 ppts; 95% CI: -4.3 to -0.55 ppts; p=0.011) and ED healthcare costs (-6.4 ppts; 95% CI: -9.8 to -2.9 ppts; p<0.001), and of having an IP hospitalization (-2.3 ppts; 95% CI: -4.26 to -0.40 ppts; p=0.018) or ED visit (-6.4 ppts; 95% CI: -10.1 to -2.8 ppts; p<0.001). However, adherence was not significantly associated with the amount of IP costs incurred conditioning on incurring any costs or the number of hospitalizations conditioning on having any hospitalizations. In contrast, adherence resulted in a 19.3 ppt reduction in total non-zero ED costs (95% CI: -30.2 to -6.7 ppts; p<0.01) and a 15.9 ppt reduction in the number of ED visits (95% CI: -22.7 to -8.2 ppts; p<0.01). ConclusionIn this sample of cognitively impaired Medicare beneficiaries, we found that closure of the Medicare Part D coverage gap successfully reduced OOP spending and increased medication use. Furthermore, medication adherence was associated with a significant reduction in the probability of healthcare resource utilization and cost. This research lays a foundation for the study of other chronic conditions and of the effects of the OOP spending caps that will be implemented by the Inflation Reduction Act.