Trends in Common Ownership among Insurers in Medicare Part D.

BACKGROUND: Recent studies document the rising prevalence of common ownership by institutional investors in specific industries. Those investors offer products, such as mutual and index funds, to trade securities on behalf of others and often own shares of multiple firms in the same industry to diversify portfolios. However, at present, few studies focus on common ownership trends in health care. OBJECTIVES: This paper examines institutional investors' common ownership in the major insurers offering plans in the Medicare Part D stand-alone prescription drug plan (PDP) market between 2013 and 2020. RESEARCH DESIGN: Using data from the Securities and Exchange Commission (SEC) database and the Center for Research in Securities Prices, we compute the percentages of outstanding shares of each insurer owned by institutional investors. Data visualization and network analysis are employed to assess the trends in common ownership among major insurers. RESULTS: We document a high prevalence of and substantial increase in shared institutional investors in the PDP market. From 2013 to 2020, the degree of common ownership increased by 7% on average, and the common ownership network became more connected. Common ownership also varies across the 34 PDP regions depending on their reliance on listed insurers, that are traded in the stock exchange, offering stand-alone PDPs. CONCLUSIONS: High and rising common ownership in the Medicare Part D PDP market raises policy questions about potential effects on plan offerings, premiums, and quality for consumers.

Prescription Drug Spending in Fee-for-Service Medicare, 2008-2019.

Importance: Prescription drug spending is a topic of increased interest to the public and policymakers. However, prior assessments have been limited by focusing on retail spending (Part D-covered drugs), omitting clinician-administered (Part B-covered) drug spending, or focusing on all fee-for-service Medicare beneficiaries, regardless of their enrollment into prescription drug coverage. Objective: To estimate the proportion of health care spending contributed by prescription drugs and to assess spending for retail and clinician-administered prescriptions. Design, Setting, and Participants: Descriptive, serial, cross-sectional analysis of a 20% random sample of fee-for-service Medicare beneficiaries in the United States from 2008 to 2019 who were continuously enrolled in Parts A (hospital), B (medical), and D (prescription drug) benefits, and not in Medicare Advantage. Exposure: Calendar year. Main Outcomes and Measures: Net spending on retail (Part D-covered) and clinician-administered (Part B-covered) prescription drugs; prescription drug spending (spending on Part B-covered and Part D-covered drugs) as a percentage of total per-capita health care spending. Measures were adjusted for inflation and for postsale rebates (for Part D-covered drugs). Results: There were 3 201 284 beneficiaries enrolled in Parts A, B, and D in 2008 and 4 502 718 in 2019. In 2019, beneficiaries had a mean (SD) age of 71.7 (12.0) years, documented sex was female for 57.7%, and 69.5% had no low-income subsidies. Total per-capita spending was $16 345 in 2008 and $20 117 in 2019. Comparing 2008 with 2019, per-capita Part A spending was $7106 (95% CI, $7084-$7128) vs $7120 (95% CI, $7098-$7141), Part B drug spending was $720 (95% CI, $713-$728) vs $1641 (95% CI, $1629-$1653), Part B nondrug spending was $5113 (95% CI, $5105-$5122) vs $6702 (95% CI, $6692-$6712), and Part D net spending was $3122 (95% CI, $3117-$3127) vs $3477 (95% CI, $3466-$3489). The proportion of total annual spending attributed to prescription drugs increased from 24.0% in 2008 to 27.2% in 2019, net of estimated rebates and discounts. Conclusions and Relevance: In 2019, spending on prescription drugs represented approximately 27% of total spending among fee-for-service Medicare beneficiaries enrolled in Part D, even after accounting for postsale rebates.

Opioid Prescriptions by Pain Medicine Physicians in the Medicare Part D Program: A Cross-Sectional Study.

BACKGROUND: Pain medicine physicians (PMP) are a group of physicians with background training in various primary specialties with interest and expertise in managing chronic pain disorders. Our objective is to analyze prescription drug (PD) claims from the Medicare Part D program associated with PMP to gain insights into patterns, associated costs, and potential cost savings areas. METHODS: The primary data source for Part D claims data is the Centers for Medicare and Medicaid Services (CMS) Chronic Conditions Data Warehouse, which contains Medicare Part D prescription drug events (PDE) records received through the claims submission cutoff date. Only providers with taxonomies of pain management (PM) and interventional pain management (IPM) were included in the study. The analysis of PDE was restricted to drugs with >250 claims. The distribution of claims and costs were analyzed based on drug class and provider specialty. Subsequently, we explored claims and expenses for opioid drug prescriptions in detail. Prescribing characteristics of the top 5% of providers by costs and claims were examined to gain additional insights. The costs and claims were explored for the top 10 drugs prescribed by PMP in 2017. RESULTS: There were a total of unique 3280 PMP-prescribed drugs with an associated expense of 652 million dollars in the 2017 Medicare Part D program. Prescriptions related to PMP account for a tiny fraction of the program's drug expenditure (0.4%). Opioids, anticonvulsants, and gabapentinoids were associated with the largest number of claims and the largest expenses within this fraction. Among opioid drug prescriptions, brand-named drugs account for a small fraction of claims (8%) compared to generic drugs. However, the expenses associated with brand name drugs were higher than generic drugs. Prescribers in the top 5% by PD costs had a higher number of claims, prescribed a higher proportion of branded medications, and had prescriptions associated with longer day supply compared to an average PMP. There were several opioid medications in the top 10 PD list by cost associated with PMP. CONCLUSIONS: Opioids were the most common medications among Medicare part D claims prescribed by PMP. Only 12% of the total opioid PD claims were by PMP. The top 5% of PMP prescribers had 10 times more claims than the average PMP.

Impact of medication synchronization programs on proportion of days covered (PDC) scores and Medicare Part D medication-related adherence metrics.

OBJECTIVES: This study aimed to determine if patients enrolled in a medication synchronization program have improvements in proportion of days covered (PDC) score for 3 of the Centers for Medicare and Medicaid Services adherence metrics medication classes: statins, renin-angiotensin-aldosterone system antagonists, and noninsulin diabetes medications. METHODS: This retrospective cohort study used data from members of a Medicare Advantage Prescription Drug plan, who took at least 1 of the key metric medications and had sufficient data to calculate a PDC score. The exposed cohort ("sync") consisted of patients who enrolled in the medication synchronization program within the plan's preferred pharmacy network, and the control group consisted of those who did not enroll in the program but met all other criteria. The primary end point was the change in PDC score from 2015 (baseline) to 2017 for each medication class. Secondary end points included the proportion of members with PDC scores of at least 85% and the association of adherence with annual medical and pharmacy costs. RESULTS: The largest PDC score increases for the entire study population were seen in all 3 sync groups (RASA, diabetes, and statin) with corresponding statistically significant PDC score increases of 1.6%, 4.8%, and 2.9%, compared with -0.4%, 0.5%, and 1.3% changes in the control groups. In the multiple linear regression analysis, there were significant PDC score differences in the changes from baseline between the sync and control RASA, diabetes, and statin groups (P = 0.005, P = 0.01, and P < 0.001, respectively). The proportion of members achieving the acceptable PDC score threshold increased by 1.1% in the control group and by 4.1% in the sync group. CONCLUSION: In a population of patients with high baseline adherence, this medication synchronization program was associated with a statistically significant increase in adherence scores for statin, RASA, and noninsulin diabetes medications. There was no significant change in medical or pharmacy costs from the health plan perspective.

Association between Higher Generic Drug Use and Medicare Part D Star Ratings: An Observational Analysis.

BACKGROUND: Increasing generic drug use, due to potential for cost savings and drug access, is a viable consideration for Medicare prescription drug plans to achieve high star ratings and improve quality of plan offerings for Medicare beneficiaries. OBJECTIVE: To examine the association between contract-level proportion of generic drugs dispensed (pGDD) and Medicare Part D star ratings. METHODS: This was a retrospective study of linked 2011 Medicare Part D star rating data with contract-level pGDD data. A total of 477 individual Medicare prescription contracts were included, representing 75% of total Prescription Drug Plans and more than 65% of total Medicare Advantage Prescription Drug Plans available by the end of 2010. Primary outcomes were Medicare Part D summary and domain star ratings (1-5 indicating lowest to highest performance), incorporating a range of quality measures for access, cost, beneficiary satisfaction, and health services outcomes and processes. Ordinal logistic regression models were used to examine associations between pGDD and Medicare Part D summary and domain star ratings, controlling for contract type and number of beneficiary enrollment. RESULTS: Higher pGDD was associated with higher summary star ratings (adjusted odds ratio 1.08 with 95% confidence interval 1.04-1.12) and higher "member experience with drug plan" domain ratings (adjusted odds ratio 1.07 with 95% confidence interval 1.03-1.11). CONCLUSIONS: Prescription formulary benefit design targeting increasing generic drug use appears to be associated with improved member experience and higher plan star ratings. Consideration may be given to incorporating pGDD into Medicare Part D star rating measures to improve quality of prescription plans.

Utilization Management Trends in Medicare Part D Oncology Drugs, 2010-2020.

This study examines the exposure of Medicare Part D beneficiaries to utilization management, such as prior authorization, for oral oncology drugs.

Adherence to antiepileptic drugs among diverse older Americans on Part D Medicare.

INTRODUCTION: Older minority groups are more likely to have poor AED adherence. We describe adherence to antiepileptic drugs (AEDs) among older Americans with epilepsy. METHODS: In retrospective analyses of 2008-2010 Medicare claims for a 5% random sample of beneficiaries augmented by minority representation, epilepsy cases in 2009 were those with ≥1 claim with ICD-9345.x or ≥2 with 780.3x, and ≥1 AED. New-onset cases had no such claims or AEDs in the year before the 2009 index event. We calculated the Proportion of Days Covered (PDC) (days with ≥1 AED over total follow-up days) and used logistic regression to estimate associations of non-adherence (PDC <0.8) with minority group adjusting for covariates. RESULTS: Of 36,912 epilepsy cases (19.2% White, 62.5% African American (AA), 11.3% Hispanic, 5.0% Asian and 2% American Indian/Alaskan Native), 31.8% were non-adherent (range: 24.1% Whites to 34.3% AAs). Of 3706 new-onset cases, 37% were non-adherent (range: 28.7% Whites to 40.5% AAs). In adjusted analyses, associations with minority group were significant among prevalent cases, and for AA and Asians vs. Whites among new cases. Among other findings, beneficiaries from high-poverty ZIP codes were more likely to be non-adherent than their counterparts, and those in cost-sharing drug benefit phases were less likely to be non-adherent than those in deductible phases. CONCLUSION: About a third of older adults with epilepsy have poor AED adherence; minorities are more likely than Whites. Investigations of reasons for non-adherence, and interventions to promote adherence, are needed with particular attention to the effect of cost-sharing and poverty.

Choice Inconsistencies among the Elderly: Evidence from Plan Choice in the Medicare Part D Program: Comment.

Consumers' enrollment decisions in Medicare Part D can be explained by Abaluck and Gruber's (2011) model of utility maximization with psychological biases or by a neoclassical version of their model that precludes such biases. We evaluate these competing hypotheses by applying nonparametric tests of utility maximization and model validation tests to administrative data. We find that 79 percent of enrollment decisions from 2006 to 2010 satisfied basic axioms of consumer theory under the assumption of full information. The validation tests provide evidence against widespread psychological biases. In particular, we find that precluding psychological biases improves the structural model's out-of-sample predictions for consumer behavior.

Choice Inconsistencies among the Elderly: Evidence from Plan Choice in the Medicare Part D Program: Reply.

We explore the in- and out-of-sample robustness of tests for choice inconsistencies based on parameter restrictions in parametric models, focusing on tests proposed by Ketcham, Kuminoff, and Powers (2016). We argue that their nonparametric alternatives are inherently conservative with respect to detecting mistakes. We then show that our parametric model is robust to KKP's suggested specification checks, and that comprehensive goodness of fit measures perform better with our model than the expected utility model.Finally, we explore the robustness of our 2011 results to alternative normative assumptions highlighting the role of brand fixed effects and unobservable characteristics.

Paying Attention or Paying Too Much in Medicare Part D.

We study whether people became less likely to switch Medicare prescription drug plans (PDPs) due to more options and more time in Part D. Panel data for a random 20 percent sample of enrollees from 2006--2010 show that 50 percent were not in their original PDPs by 2010. Individuals switched PDPs in response to higher costs of their status quo plans, saving them money. Contrary to choice overload, larger choice sets increased switching unless the additional plans were relatively expensive. Neither switching overall nor responsiveness to costs declined over time, and above-minimum spending in 2010 remained below the 2006 and 2007 levels.

Recent trends in cost-related medication nonadherence among stroke survivors in the United States.

OBJECTIVE: Recent economic and health policy changes may have affected the ability of chronically ill patients to afford their medications. We assessed changes in cost-related nonadherence to medication (CRN) before and after the implementation of Medicare Part D in 2006. METHODS: We used data from the National Health Interview Survey, an annual, population-based survey of community-dwelling, noninstitutionalized US adults, to estimate CRN in 8,673 stroke survivors aged 45 years or older, representing 4.8 million survivors, for the years 1999 to 2010. The main outcome measure was CRN, defined as self-reported inability to afford prescribed medication within the past 12 months. RESULTS: During the period 1999 to 2010, 11.4% of stroke survivors, approximately 543,000 individuals, reported CRN. From 1999 to 2010, CRN more than doubled among stroke survivors aged 45 to 64 years (from 12.7 to 26.5%; ptrend = 0.01). CRN remained stable among those aged 65 years or older (from 3.8 to 7.0%; ptrend = 0.21). From 1999-2005 to 2006-2010, CRN among uninsured stroke survivors aged 45 to 64 years increased from 43.1 to 57.1% (p = 0.03). Among stroke survivors aged 65 years or older with Medicare coverage, CRN was higher among Medicare Part D participants than those without the drug benefit (7.9 vs 4.8%; p = 0.02). After adjustment for sociodemographic and clinical factors, CRN was similar among Medicare Part D enrollees and nonenrollees. INTERPRETATION: From 1999 to 2010, CRN increased significantly among stroke survivors younger than 65 years, particularly among those without health insurance. There was no evidence that Medicare Part D decreased CRN among stroke survivors with Medicare.

Race/Ethnicity, disability, and medication adherence among medicare beneficiaries with heart failure.

BACKGROUND: Recent and national data on adherence to heart failure drugs are limited, particularly among the disabled and some small minority groups, such as Native Americans and Hispanics. OBJECTIVE: We compare medication adherence among Medicare patients with heart failure, by disability status, race/ethnicity, and income. DESIGN: Observational study. SETTING: US Medicare Parts A, B, and D data, 5% random sample, 2007-2009. PARTICIPANTS: 149,893 elderly Medicare beneficiaries and 21,204 disabled non-elderly beneficiaries. MAIN MEASURES: We examined 5% of Medicare fee-for-service beneficiaries with heart failure in 2007-2009. The main outcome was 1-year adherence to one of three therapeutic classes: ß-blockers, diuretics, and angiotensin-converting enzyme inhibitors (ACEIs)/angiotensin II receptor blockers (ARBs). Adherence was defined as having prescriptions in possession for ≥ 75% of days. KEY RESULTS: Among aged beneficiaries, 1-year adherences to at least one heart failure drug were 63%, 57%, 53%, 50%, and 52% for Whites, Asians, Hispanics, Native Americans and Blacks, respectively; among the disabled, 1-year adherence was worse for each group: 57%, 53%, 48%, 44% and 43% respectively. The racial/ethnic difference persisted after adjustment for age, gender, income, drug coverage, location and health status. Patterns of adherence were similar among beneficiaries on all three therapeutic classes. Among beneficiaries with close-to-full drug coverage, minorities were still less likely to adhere relative to Whites, OR = 0.61 (95% CI 0.58-0.64) for Hispanics, OR = 0.59 (95% CI 0.57-0.62) for Blacks and OR = 0.57 (95% CI 0.47-0.68) for Native Americans. CONCLUSION: After the implementation of Medicare Part D, adherence to heart failure drugs remains problematic, especially among disabled and minority beneficiaries, including Native Americans, Blacks, and Hispanics. Even among those with close-to-full drug coverage, racial differences remain, suggesting that policies simply relying on cost reduction cannot eliminate racial differences.

Role of Specialty Drugs in Rising Drug Prices for Medicare Part D.

Importance: Prices for brand-name drugs affect both federal spending and out-of-pocket liability for Medicare Part D enrollees. Objective: To examine how prices for brand-name drugs, net of rebates and discounts, have changed from 2010 to 2019 and to examine the role of specialty drugs in those changes. Design, Setting, and Participants: This study involved a descriptive analysis of prescription drug spending and prices between 2010 and 2019. The universe of prescription drug event data from those years were combined with confidential data from the Centers for Medicare & Medicaid Services on rebates and discounts that manufacturers and pharmacies pay to Medicare Part D plans to calculate rebate percentages, net spending, and net prices at the drug level. Specialty drugs were identified using information from IQVIA, allowing for a stratified analysis by specialty status. Data were analyzed from March 2019 to March 2024. Main Outcomes and Measures: Average prices (net of rebates and discounts in 2019 US dollars) and average annual price growth for brand-name prescription drugs, overall and separately for specialty and nonspecialty drugs. Results: Average net prices for brand-name drugs doubled from 2010 to 2019 (from $167 to $370). Growth in specialty drug prices was an underlying factor in those increases: average annual price growth was 13.2% for specialty drugs compared with 2.6% for nonspecialty drugs. Price growth for specialty drugs over the decade was smaller than what the Congressional Budget Office reported for the 2010 to 2015 period (increase of 22.3% per year vs 4.5% per year for nonspecialty drug prices), suggesting that price growth slowed after 2015. Drugs that treat hepatitis C contributed to that difference because prices for those drugs were initially high and then subsequently fell. Absent those drugs, price growth for specialty drugs averaged 18.1% in the first half of the decade and 6.9% in the second half. Conclusions and Relevance: Results of this study show that prices for specialty drugs have continued to increase over time in the Medicare Part D program, which contributes to high out-of-pocket liability for users of those drugs in addition to US federal budgetary expenditures.

Confronting "confounding by health system use" in Medicare Part D: comparative effectiveness of propensity score approaches to confounding adjustment.

PURPOSE: Under Medicare Part D, patient characteristics influence plan choice, which in turn influences Part D coverage gap entry. We compared predefined propensity score (PS) and high-dimensional propensity score (hdPS) approaches to address such "confounding by health system use" in assessing whether coverage gap entry is associated with cardiovascular events or death. METHODS: We followed 243,079 Medicare patients aged 65+ years with linked prescription, medical, and plan-specific data in 2005-2007. Patients reached the coverage gap and were followed until an event or year's end. Exposed patients were responsible for drug costs in the gap; unexposed patients (patients with non-Part D drug insurance and Part D patients receiving a low-income subsidy) received financial assistance. Exposed patients were 1:1 PS-matched or hdPS-matched to unexposed patients. The PS model included 52 predefined covariates; the hdPS model added 400 empirically identified covariates. Hazard ratios for death and any of five cardiovascular outcomes were compared. In sensitivity analyses, we explored residual confounding using only low-income subsidy patients in the unexposed group. RESULTS: In unadjusted analyses, exposed patients had no greater hazard of death (HR = 1.00; 95%CI, 0.84-1.20) or other outcomes. PS-matched (HR = 1.29; 0.99-1.66) and hdPS-matched (HR = 1.11; 0.86-1.42) analyses showed elevated but non-significant hazards of death. In sensitivity analyses, the PS analysis showed a protective effect (HR = 0.78; 0.61-0.98), whereas the hdPS analysis (HR = 1.06; 0.82-1.37) confirmed the main hdPS findings. CONCLUSION: Although the PS-matched analysis suggested elevated but non-significant hazards of death among patients with no financial assistance during the gap, the hdPS analysis produced lower estimates that were stable across sensitivity analyses.

Drug benefit changes under Medicare Advantage Part D: heterogeneous effects on pharmaceutical use and expenditures.

BACKGROUND: Although Medicare Part D improved drug benefits for many beneficiaries, its impact on the coverage of Medicare Advantage Part D (MAPD) enrollees depended on their pre-existing benefits and whether they had gap coverage under Part D. OBJECTIVE: To examine changes in prescription drug utilization and expenditures associated with drug benefit changes resulting from the implementation of Part D. PATIENTS: We studied 248,773 continuously enrolled MAPD patients in eight states. Patients whose insurance product or Census block could not be identified or who had atypical benefits, low-income subsidies or Medicaid coverage were excluded. MAIN MEASURES: The main outcomes were changes in prescription drug days supply and expenditures from 2005 to 2006 and 2005 to 2007. DESIGN: We linked Census data with 2005-7 MAPD claims, encounter, enrollment, and benefits data and estimated associations of the outcomes with changes in drug benefits, controlling for 2005 comorbidities, demographics, and Census population characteristics. KEY RESULTS: MAPD enrollees whose drug benefits became potentially less generous after Part D had the smallest increases in drug utilization and expenditures (e.g., drug expenditures increased by $130 between 2005 and 2006), while those who potentially gained the most from Part D experienced the largest increases ($302). The differences in benefit design changes had a stronger association with drug utilization and outcomes among patients at high risk of gap entry than among the entire sample. CONCLUSIONS: Although Medicare Part D unambiguously improved drug coverage for many elderly, it led to heterogeneous changes in drug benefits among MAPD enrollees, who already had generic and sometimes branded drug benefits. After 2006, benefits were worse for individuals who had branded drug coverage in 2005 but now had a coverage gap, but benefits may have improved for individuals who acquired branded drug coverage. Commensurate with these differential changes in benefits following Part D, changes in drug utilization and expenditures varied substantially as well.