Many Medicare beneficiaries enroll in managed care health plans to obtain
outpatient drug benefits. Increasing pharmaceutical utilization and costs
and decreasing drug benefits increase the likelihood that medication use by
such enrollees will exceed drug benefits, which may lead to health plan disenrollment.
To test the hypothesis that exhaustion of managed care drug benefits
by Medicare beneficiaries is associated with disenrollment from the health
Retrospective cohort study followed up for 1 year (1998) using an enrollment/claims
Four geographically diverse network-model health plans that had annual
drug benefits of $300, $500, $600, or $1000.
A total of 61,412 elderly Medicare beneficiaries.
Main Outcome Measure
Voluntary disenrollment from health plans by members who did or did
not exhaust their drug benefits.
The likelihood of exhausting 1998 drug benefits ranged from 17% to 25%
across health plans (P<.001). The relative hazards
of disenrollment from the 4 plans when drug benefits had been exhausted were
2.5 (95% confidence interval [CI], 2.3-2.8), 1.9 (95% CI, 1.7-2.1), 2.7 (95%
CI, 2.0-3.6), and 2.1 (95% CI, 1.9-2.4). Statistical adjustments for age,
sex, prior enrollment, hospital admissions, physician visits, and county of
residence did not alter these estimates.
Exhaustion of drug benefits was associated with a significant increase
in the likelihood of disenrollment of Medicare beneficiaries. This finding
arouses concern that Medicare beneficiaries must change plans to have financial
access to medications, which can lead to discontinuity in care and diversion
of resources from care to administrative matters. Policymakers should strive
to avoid fragmented systems of providing drug benefits.