Comparing pre-gap and gap behaviors for Medicare beneficiaries in a Medicare managed care plan

To examine the impact of the coverage gap on pharmacy use, expenditures, and out-of-pocket costs for Medicare managed care beneficiaries before and after reaching the gap.

A longitudinal comparison of behaviors for beneficiaries with non-gap coverage before and after reaching the gap.

Prescription drug use and expenditures were assessed for Medicare beneficiaries who reached the gap, including subsets with one of four chronic disorders (congestive heart failure (CHF), diabetes, dyslipidemia, or hypertension). Differences in pre- and post-prescription use were calculated using generalized estimating equations. Time until the end and start of the gap was estimated using a Cox proportional hazards model. Expenditure data were estimated using bootstrap methods.

Roughly a quarter (27.1 percent) of patients reached the gap in 2006, of whom 3.6 percent passed through the gap. The most prevalent disease state was hypertension (58.5 percent). Beneficiaries took an average of 8.1 months to reach the gap. Patients <65 years (HR = 1.42, 95% CI = 1.29 - 1.56) and those with diabetes (HR = 1.19, 95% CI = 1.12 - 1.27) were more likely to reach the gap sooner as compared to older beneficiaries (aged 65 to 74) and those without diabetes. These individuals were more likely to pass through the gap as well. Beneficiaries faced a 60.7 percent increase in out-of-pocket expenditures in the gap phase. Brand-name medication use decreased by 9.3 percent, while generic medication use increased by 7.4 percent. For chronic conditions, however, over 90 percent of individuals continued brand-name medication use in the gap.

Our findings suggest that, in general, beneficiaries take lower-cost generics while in the gap. However, taking brand-name medications is the predominant behavior for beneficiaries with chronic diseases. Health care reform provisions that close the gap over the next ten years may facilitate continuity of medication use while in the gap.