Beneficiary Health Factors Related to Prescription Drug Costs in the Medicare Part D Program

Many older adults cannot afford the required regimen of prescription drugs even with the implementation of Medicare Part D in 2006. Little empirical research exists that looks at the relationship between out-of-pocket drug costs for Medicare Part D beneficiaries and health and socioeconomic factors. The purpose of this study was to examine the financial impact of Medicare Part D Prescription Drug Plans (PDPs) for beneficiaries with respect to certain health status designations, demographic, and socioeconomic variables. Olmstead's and Zeckhauser's conceptualization of the menu-setting problem (MSP) provided the theoretical model. The overarching research question focused on how the exogenous parameter, health status, is impacted by out-of-pocket prescription drug costs. Out-of-pocket prescription drug questionnaire data extracted from the 2006-2008 Medicare Current Beneficiary Survey (MCBS), N=564, 643, and 612, respectively, were analyzed using Spearman rho correlations. The relationships among out-of-pocket prescription drug costs and independent health, socioeconomic factors, and number of comorbidities were examined. Findings indicate that there is a positive linear relationship between out-of-pocket costs and each health status factor. An inverse relationship was reported as the number of comorbidities decreased, out-of-pocket drug costs increased. This study demonstrates positive social change by contributing to a better understanding of how Medicare Part D prescription drug programs impact overall health and morbidity among Medicare beneficiaries.