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Impact of Medicare Part D Plan Features on Use of Generic Drugs

Background:Little is known about how Medicare Part D plan features influence choice of generic versus brand drugs. Objectives:To examine the association between Part D plan features and generic medication use. Methods:Data from a 2009 random sample of 1.6 million fee-for-service, Part D enrollees aged 65 years and above, who were not dually eligible or receiving low-income subsidies, were used to examine the association between plan features (generic cost-sharing, difference in brand and generic copay, prior authorization, step therapy) and choice of generic antidepressants, antidiabetics, and statins. Logistic regression models accounting for plan-level clustering were adjusted for sociodemographic and health status. Results:Generic cost-sharing ranged from $0 to $9 for antidepressants and statins, and from $0 to $8 for antidiabetics (across 5th–95th percentiles). Brand-generic cost-sharing differences were smallest for statins (5th–95th percentiles: $16–$37) and largest for antidepressants ($16–$64) across plans. Beneficiaries with higher generic cost-sharing had lower generic use [adjusted odds ratio (OR)=0.97, 95% confidence interval (CI), 0.95–0.98 for antidepressants; OR=0.97, 95% CI, 0.96–0.98 for antidiabetics; OR=0.94, 95% CI, 0.92–0.95 for statins]. Larger brand-generic cost-sharing differences and prior authorization were significantly associated with greater generic use in all categories. Plans could increase generic use by 5–12 percentage points by reducing generic cost-sharing from the 75th ($7) to 25th percentiles ($4–$5), increasing brand-generic cost-sharing differences from the 25th ($25–$26) to 75th ($32–$33) percentiles, and using prior authorization and step therapy. Conclusions:Cost-sharing features and utilization management tools were significantly associated with generic use in 3 commonly used medication categories.