Press Releases

Medicare Beneficiaries Remain Confused about the New Prescription Drug Benefit

EAST HANOVER, NJ, October 6, 2005 — Medicare patients remain confused about the new prescription drug benefit included in Part D of the Medicare Prescription Drug Improvement and Modernization Act (MMA), set to go into effect in January 2006. According to the results of GfK Market Measures’ new Impact of MMA on Patients Study, announced today, patients have little knowledge of the structure or specifics of the new benefit with most not even aware of when they need to register. As a result, interest in participating is limited, particularly among affluent seniors who are satisfied with their current coverage and see little incentive for moving to a new system.

Because they are less likely to have prescription coverage now, low-income patients are more apt to be interested in taking advantage of Part D. Even among this group, however, there is little understanding of the differences between the Prescription Drug Plan (PDP) and Medicare Advantage (MA-PD) options. If they are currently covered, most seniors consider staying with their current plan the most attractive choice.

“Clearly, patient education will be key in getting Medicare beneficiaries to enroll in Part D and to have realistic expectations of the benefits it will deliver,” says Larry Olson, Director of GfK Market Measures’ Consumer Health Practice. “In particular, pharmaceutical manufacturers need to let patients know which plans have given their branded drugs preferred formulary status before enrollment begins on November 15. Right now, most patients are unaware that the drugs offered will vary from one plan to another—and that they will need to review choices carefully to select a plan that covers the brands they want.”

The Media, Government and AARP Are Key Information Sources

Most seniors are turning to the news media, the government and AARP for information on Part D. Medicare beneficiaries indicate they expect to get further information from these sources about the Part D prescription drug benefit in the weeks to come. To date, family, friends and healthcare providers have played only a minor role in helping to educate patients on MMA.

When making specific decisions about coverage, Medicare patients expect to rely on Medicare itself. In addition, when they need to know about the specific drugs included in the plan options, patients will count first on their doctors, followed by the government, Medicare and Social Security. Pharmacists also will play a key part in advising patients about the drugs available in particular plans.

“Doctors are likely to be inundated with questions about the coverage of specific medications,” according to Olson. “Pharmaceutical manufacturers will benefit by providing doctors who see a heavy load of seniors—such as primary care physicians and cardiologists—with easy-to-use reference materials that show which plans have their brands on formulary and that detail that strengths of their products.”

Diabetes Patients Are Most Interested in Part D, though Least Knowledgeable

Medicare patients differ in their reactions to MMA, depending on their specific medical conditions, with diabetes patients most interested in participating. Taking an average of seven prescription medications, diabetics report the greatest difficulty in facing the burden of monthly drug expenses. Therefore, they are eager to obtain prescription coverage. At the same time, they classify themselves as the least knowledgeable “disease group” about the new benefit.

Medicare Population Shows Vast Discrepancies in Drug Coverage, Based on Household Income

Among the Medicare population, there are vast differences in prescription coverage, based on household income. Higher income Medicare patients tend to be covered by retirement plans, while lower-income beneficiaries are more likely to be covered by Medicaid, Medicare Risk and other programs. In addition, nearly half of the lower-income patients have no coverage of any type, making prescription drug costs a significant concern.

“Under MMA, lower-income Medicare beneficiaries now will gain access to prescription drug coverage, leading to increased usage of prescription products,” says Olson. “As a result, our MMA research with MCOs shows that the use of formularies and restrictions may increase to manage this growing pharmacy utilization—and that these more aggressive measures will be accompanied by more complex plan designs.”

Patients Share Their MMA Insights GfK Market Measures

The Impact of MMA on Patients is based on telephone interviews with a projectable sample of 1,000 Medicare patients taking prescription drugs. The research was conducted July 6 - 18 of 2005.

The current patient study is the first of two waves, with follow-up research planned for February 2006. In addition to the patient study, GfK Market Measures is executing research with the other key stakeholders affected by Part D—physicians and managed care organizations (MCOs). Wave 1 of the physician research will be available by the end of September 2005, with a second wave planned for February 2006. Wave 1 of the MCO study is available now, with second-wave findings available in November 2005.

About GfK Market Measures…

A leading supplier of primary research to the healthcare community, GfK Market Measures is a company of the GfK US Healthcare Companies, part of The GfK Group—one of the world’s top-three market research organizations. GfK Market Measures provides a unique mix of custom and multi-client solutions that illuminate the “whys” driving market results. Services cover a full range of applications, including sales force effectiveness, market and opportunity assessment, therapeutic class analysis and concept testing.