Seniors Overspending on Prescription Drug Plans
Medicare Part D beneficiaries overspend by hundreds per year due to difficulty selecting plan
FRIDAY, Oct. 12 (HealthDay News) -- Recipients of Medicare Part D benefits have difficulty selecting the most cost-effective plan to cover their medication needs and, consequently, overpay by an average of $368 per year, with one-fifth overspending by $500 or more per year, according to research published in the October issue of Health Affairs.
Chao Zhou, Ph.D., and Yuting Zhang, Ph.D., of the University of Pittsburgh, conducted a study using 2009 Medicare Part D data to determine whether seniors were able to choose the most cost-effective plan for themselves from among the dozens of competing plans.
The researchers found that only 5.2 percent of beneficiaries chose the cheapest plan. On average, Medicare Part D beneficiaries spent $368 more per year than necessary, based on their medication needs. A substantial percentage (22 percent) spent $500 or more per year above what was necessary. Many overspent on plan premiums for unneeded features such as generic drug coverage.
"People need assistance in choosing the least expensive plan for their medical needs," Zhou said in a statement. "Educational programs that help people navigate the dozens of plans available would make it easier to select plans that best meet their health care needs without overspending."