Medicare Part D Rx drug coverage saved $1.5 billion a year in first 4 years

A new study by the Johns Hopkins Bloomberg School of Public Health and the University of Illinois at Chicago finds that the USA’s Medicare Part D prescription coverage significantly reduced hospital admissions and program expenditures totaling $1.5 billion annually, report EurekAlert.

In the largest and most rigorous impact analysis of Medicare Part D to date, researchers found that gaining prescription drug insurance through Medicare Part D reduced hospitalizations by 8%, decreased annual Medicare expenditures for hospitalization by 7% and reduced hospital charges associated with hospitalization by 12% during the program's first four years.

The study, published by the National Bureau of Economic Research, estimates that the aggregate savings from reduced hospital expenditures associated with expanded Medicare Part D prescription drug coverage totaled around $1.5 billion per year, or about 2.2% of the total $67.7 billion cost of Medicare Part D in 2011.