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Effect of Medicare Pharmacy Benefit Coverage on VA Healthcare Users


The prescription co-payment for Veterans is $7 for each 30-day supply, making it a cost-effective alternative for Veterans with limited pharmaceutical coverage outside VA. Therefore, it is not surprising that VA is the largest single purchaser of pharmaceuticals in the US. This study examined the influence of Medicare pharmacy benefit coverage on VA pharmacy use among Veterans using the VA healthcare system during 2002, who had diabetes mellitus (n=142,528), ischemic heart disease (n=210,931), or chronic heart failure (n=16,238). Using VA and Medicare data, investigators examined patterns of pharmacotherapy among VA healthcare users also enrolled in fee-for-service (FFS) or managed-care (HMO) plans, specifically assessing 10 condition-related drug classes (e.g., statins, insulin, ß-blockers).

Overall, results showed that Veterans dually enrolled in VA and Medicare FFS were less likely to receive condition-related medications from VA compared with Veterans enrolled in HMOs with lower levels of prescription drug coverage. Among Veterans enrolled in HMO plans, there were few systematic differences among levels of pharmacy coverage; however there were some exceptions. For example, among Veterans with ischemic heart disease, receipt of ß-blockers and anti-anginals from VA was less in HMO patients with higher levels of pharmacy coverage. Veterans in HMOs with some pharmacy coverage were more likely to use VA for insulin and statins, while those in HMOs with higher levels of coverage were much less likely to receive oral hypoglycemics from VA than were patients in HMOs without pharmacy benefits. One implication of the overall study findings is that VA will become less the healthcare system of choice for Veteran beneficiaries if Medicare pharmacy services become more affordable. Moreover, Veterans with chronic conditions that require many medications and who hit a coverage gap in Medicare Part D or have difficulty making the Medicare co-payments may turn to VA as a safety net at intermittent times rather than using VA pharmacy services more steadily.

PubMed Logo Johnson M, Petersen L, Sundaravaradan R, et al. The association of Medicare drug coverage with use of evidence-based medications in the Veterans Health Administration. The Annals of Pharmacotherapy October 2009;43(10):1565-1575.

This study was partly supported by HSR&D. Drs. Johnson, Petersen, and Sundaravaradan are part of HSR&D’s Houston Center for Quality of Care and Utilization Studies.

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HSR&D requires notification by HSR&D-funded investigators about all articles accepted for publication. These journal articles are reviewed by HSR&D and publication briefs or summaries are written for a select number of articles that are then forwarded to VHA Central Office leadership to keep them informed about important findings or information. Articles to be summarized are selected by HSR&D based on timeliness of the findings, interest of leadership, or potential impact on the organization. Publication briefs are written for only a small number of HSR&D published articles. Visit the HSR&D citations database for a complete listing of HSR&D articles and presentations.