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The Impact of the Medicare Part D Prescription Benefit on Generic Drug Use

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Abstract

Background

Little information exists regarding the impact of Medicare Part D on generic drug use.

Objective

To examine changes in the use of generic prescriptions attributable to Part D among a sample of Medicare beneficiaries.

Design, participants, and measurements

Difference-in-difference analysis of pharmacy claims of Part D enrollees and non-enrollees aged 67–79 years from 2005 to 2006. The final sample represented approximately 2.4 million unique subjects. Analyses were conducted separately for major therapeutic classes, limited to subjects filling at least one prescription within the class during 2005 and 2006, and adjusted for subject characteristics, prescription characteristics, socio-demographic characteristics measured through zipcode-linked Census data, baseline differences between Part D and non-Part D enrollees, and secular trends in generic use.

Results

Generic drugs accounted for 58% of total prescriptions. Among the entire group of beneficiaries, there was a trend of increased generic drug use in 13 out of 15 drug classes examined. However, after adjusting for potential confounders, the growth rate of generic drug use was lower among Part D enrollees than among non-enrollees; enrollees were slightly less likely to fill prescriptions for generic drugs vs. brand-name drugs in 2006 compared to 2005 (odds ratio 0.95, 95% confidence interval 0.94–0.95).

Conclusions

Despite secular trends of increased utilization of generic drugs among both Part D enrollees and non-enrollees, the net impact of Part D among these beneficiaries was a modest decrease in the use of generic drugs. This finding, which is consistent with economic theory but contrary to several recent reports, highlights the complexity of assessing the impact of Part D on overall consumer welfare.

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Acknowledgements

Dr. Zhang was supported in part by a grant from Merck, Dr. Yin is a Robert Wood Johnson Foundation Health Policy Scholar, and Dr. Alexander has career development awards from the Agency for Healthcare Research and Quality (K08 HS15699–01A1) and the Robert Wood Johnson Physician Faculty Scholars Program. The funding sources had no role in the design and conduct of the study, analysis or interpretation of the data, and preparation or final approval of the manuscript prior to publication.

Conflict of Interest

Dr. Zhang was supported in part by a pilot grant from the University of Chicago Center for Pharmaceutical Policy funded by the Merck Foundation. Dr. Sun previously worked at Walgreens Health Initiatives, is currently employed by Takeda Pharmaceuticals, and has been funded for other projects by grants from Merck, Novartis, BMS, and Sanofi-Aventis. Dr. Alexander has been funded for other projects by the University of Chicago Center for Pharmaceutical Policy funded by the Merck Foundation and by Pfizer.

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Authors and Affiliations

  1. Department of Pharmacy, School of Pharmacy, Virginia Commonwealth University, Richmond, VA, USA

    James X. Zhang PhD

  2. Center for Health and Social Sciences, University of Chicago, Chicago, IL, USA

    Wesley Yin PhD & G. Caleb Alexander MD, MS

  3. Harvard University, Robert Wood Johnson Scholars Program in Health Policy, Cambridge, MA, USA

    Wesley Yin PhD

  4. University of Chicago, Harris School of Public Policy, Chicago, IL, USA

    Wesley Yin PhD

  5. Health Outcomes Department, Walgreens Health Services, Deerfield, IL, USA

    Shawn X. Sun PhD

  6. Section of General Internal Medicine, Department of Medicine, University of Chicago, Chicago, IL, USA

    G. Caleb Alexander MD, MS

  7. MacLean Center for Clinical Medical Ethics, University of Chicago, Chicago, IL, USA

    G. Caleb Alexander MD, MS

  8. Department of Pharmacy Practice, University of Illinois at Chicago School of Pharmacy, Chicago, IL, USA

    G. Caleb Alexander MD, MS

Authors
  1. James X. Zhang PhD
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  2. Wesley Yin PhD
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  3. Shawn X. Sun PhD
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  4. G. Caleb Alexander MD, MS
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Corresponding author

Correspondence to G. Caleb Alexander MD, MS.

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Zhang, J.X., Yin, W., Sun, S.X. et al. The Impact of the Medicare Part D Prescription Benefit on Generic Drug Use. J GEN INTERN MED 23, 1673–1678 (2008). https://doi.org/10.1007/s11606-008-0742-6

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  • DOI: https://doi.org/10.1007/s11606-008-0742-6

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