Prescription Drugs and the Elderly
Issues and Options
Published In: Health Affairs, v. 13, no. 2, Spring (II), 1994, p. 157-174
Posted on RAND.org on December 31, 1993
Looks at insurance coverage for prescription drugs for the elderly. Medicare stands alone among the major insurers in not covering prescribed medications, and the risk of large, out-of-pocket drug costs among the elderly is considerable. In terms of dollar amount, the top 11 percent of the elderly who bought prescription drugs in 1991 spent $1,200 or more per person. Yet, 46 percent of the elderly had no insurance coverage for prescription drugs in 1991, and private coverage is not likely to expand or deepen. Moreover, adverse selection makes drug coverage less affordable for those with lower risks and less accessible to those with higher risks. Additional research could lead to a better understanding about how changing Medigap drug provisions might affect enrollment, behavior under prescription drug insurance, drug spending variation among the elderly in terms of chronic versus acute illness, and individual provider behavior under different insurance provisions.