Medicare Rx cards save money but prices vary

August 23, 2004

Medicare Rx discount cards save beneficiaries money but the prices offered by the cards vary widely, according to an analysis conducted for the Kaiser Family Foundation.

 

COMMUNITY PRACTICE

Medicare Rx cards save money but prices vary

Discount prescription cards do save Medicare beneficiaries money, but the savings can vary significantly from card to card, according to an independent analysis released by the Kaiser Family Foundation.

The prices offered by seven discount cards ranged from 19% to 24% lower than cash retail pharmacy prices in Baltimore, and 17% to 22% lower than cash retail pharmacy prices in a rural Maryland community, according to an analysis conducted for the foundation by Health Policy Alternatives. Medications that were purchased through mail order were lower by 27%-32% than retail costs in Baltimore. Cards sponsored by the National Community Pharmacists Association and the National Association of Chain Drug Stores were not included in the study.

The card in which a beneficiary enrolls greatly impacts potential savings, according to the analysis. For example a hypothetical patient filling 30-day scripts for four drugs could save $123 by choosing the card with the lowest retail prices. And a patient on eight medications could pay $142 more by choosing the card with the highest prices.

After some initial price instability and unreliability, card prices have not moved downward, the researchers found. The price stability suggests that competition between cards for enrollees "has not resulted in widespread efforts by sponsors to meet or beat the prices of other cards," the authors concluded.

About 3.9 million eligible Medicare beneficiaries have signed up for discount Rx drug cards, but less than one million have enrolled on their own initiative, according to the researchers. The vast majority of the cardholders have been automatically enrolled in the cards offered by their Medicare Advantage health plans or through state pharmacy assistance programs. About one million of the seven million low-income beneficiaries eligible for $600 in assistance have enrolled.

Despite a slow start, beneficiaries are now signing up at the rate of 100,000 per week, said Mark McClellan, M.D., administrator of the Centers for Medicare & Medicaid Services. Speaking at the foundation's press briefing in Washington, D.C., he said the program is a "work in progress," and "we're going to keep working on what we're learning here." He added that the agency would soon take steps to make enrollment easier by allowing beneficiaries to sign up electronically for a card.

The study is on the Web at http://www.kff.org/medicare/med072804pkg.cfm.

Carol Ukens



Carol Ukens. Medicare Rx cards save money but prices vary.

Drug Topics

Aug. 23, 2004;148:30.