Brand-name prescription drug use among Veterans Affairs and Medicare Part D patients with diabetes: a national cohort comparison

Abstract

Background: Medicare Part D and the U.S. Department of Veterans Affairs (VA) use different approaches to manage prescription drug benefits, with implications for spending. Medicare relies on private plans with distinct formularies, whereas the VA administers its own benefit using a national formulary.

Objective: To compare overall and regional rates of brand-name drug use among older adults with diabetes in Medicare and the VA.

Design: Retrospective cohort.

Setting: Medicare and the VA, 2008.

Patients: 1,061,095 Medicare Part D beneficiaries and 510,485 veterans aged 65 years or older with diabetes.

Measurements: Percentage of patients taking oral hypoglycemics, statins, and angiotensin-converting enzyme (ACE) inhibitors or angiotensin-receptor blockers (ARBs) who filled brand-name drug prescriptions and percentage of patients taking long-acting insulins who filled analogue prescriptions. Sociodemographic- and health status-adjusted hospital referral region (HRR) brand-name drug use was compared, and changes in spending were calculated if use of brand-name drugs in 1 system mirrored the other.

Results: Brand-name drug use in Medicare was 2 to 3 times that in the VA: 35.3% versus 12.7% for oral hypoglycemics, 50.7% versus 18.2% for statins, 42.5% versus 20.8% for ACE inhibitors or ARBs, and 75.1% versus 27.0% for insulin analogues. Adjusted HRR-level brand-name statin use ranged (from the 5th to 95th percentiles) from 41.0% to 58.3% in Medicare and 6.2% to 38.2% in the VA. For each drug group, the 95th-percentile HRR in the VA had lower brand-name drug use than the 5th-percentile HRR in Medicare. Medicare spending in this population would have been $1.4 billion less if brand-name drug use matched that of the VA.

Limitation: This analysis cannot fully describe the factors underlying differences in brand-name drug use.

Conclusion: Medicare beneficiaries with diabetes use 2 to 3 times more brand-name drugs than a comparable group within the VA, at substantial excess cost.

Figure 1

Distribution of adjusted HRR-level percent of patients with diabetes in Medicare Part D and the VA using brand-name drugs (and insulin analogues), among users of four groups of medications, 2008. Notes Each dot is one HRR (hospital referral region), and all HRR percents are adjusted for sociodemographic and health status variables. Abbreviations: Statins, HMG-CoA reductase inhibitors; ACE/ARB, angiotensin-converting enzyme inhibitor/angiotensin receptor blocker.

Figure 2

Absolute difference, within each HRR, in adjusted percent of diabetes patients age 65+ in Medicare Part D and the VA using brand-name drugs, among users of four groups of medications, 2008. Notes Each dot is one HRR (hospital referral region), and all HRR percents are adjusted for sociodemographic and health status variables. More positive differences indicate higher rates of brand-name use in Medicare compared to VA in a given HRR. Abbreviations: Statins, HMG-CoA reductase inhibitors; ACE/ARB, angiotensin-converting enzyme inhibitor/angiotensin receptor blocker.

Figure 3

Prescription spending and projected spending if use of brand-name drugs would change, in each of four drug groups among diabetes patients age 65+ in Medicare Part D (top) and the VA (bottom), 2008. Notes Medicare refers to patients enrolled in fee-for-service Parts A, B and stand-alone Part D. Abbreviations: Statins, HMG-CoA reductase inhibitors; ACE/ARB, angiotensin-converting enzyme inhibitor/angiotensin receptor blocker.