Growing differences between Medicare beneficiaries with and without drug coverage

Using data from the 1998 Medicare Current Beneficiary Survey (MCBS), we examine changes in beneficiaries' prescription drug coverage from 1997 to 1998 and compare drug use and spending data for beneficiaries with and without drug coverage. The data show that in 1998 the aggregate prescription drug coverage rate of Medicare beneficiaries may have reached a plateau. Also, prescription drug use declined for beneficiaries without drug coverage and increased for those with drug coverage. Covered beneficiaries also paid a larger percentage of their total drug costs out of pocket in 1998 than in 1997. The result was a widening of use and spending differences between beneficiaries with and without coverage.