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Impact on Recipients

Evaluating the Impact of Medicare Part D on the Virginia Preferred Drug List Program Justin Lester, PharmD, MBA First Health Services Corporation August 31, 2005. Impact on Recipients. Dual Eligible – Individual entitled to Medicare and also eligible for some level of Medicaid benefits

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Impact on Recipients

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  1. Evaluating the Impact of Medicare Part D on the Virginia Preferred Drug List ProgramJustin Lester, PharmD, MBAFirst Health Services CorporationAugust 31, 2005

  2. Impact on Recipients • Dual Eligible – Individual entitled to Medicare and also eligible for some level of Medicaid benefits • 7.5 million (13.6%) of Medicaid’s 55 million recipients nationwide are “duals” (FFY 2003 data) • This population accounts for approximately 51% of Medicaid prescription drug expenditures and 40% of total Medicaid costs • Source: Dual Eligibles:Medicaid Enrollment and Spending for Medicare Beneficiaries in 2003. Kaiser Commission on Medicaid and the Uninsured. July 2005.

  3. Impact on Recipients • Virginia Medicaid: • Dual eligibles are estimated to represent approximately 18% of the state’s total Medicaid population • Within the fee-for-service population dual eligibles are estimated to account for 57% of all drug expenditures

  4. Impact on Utilization • PDL classes treating disease states dominated by the elderly will see a decline in drug utilization • Cardiovascular Disease • Diabetes • Osteoporosis • Glaucoma • COPD • These therapeutic categories are responsible for a significant portion of the state’s FFS drug utilization

  5. Impact on Utilization • Disease states effecting a younger population will assume a larger proportion of Medicaid drug spend • CNS medications • Antidepressants • Antipsychotics • CNS stimulants (ADHD) • Remaining PDL classes will see much of their reduction in utilization, varying widely by therapeutic category

  6. PDL Strategy • Encourage addition of new PDL classes for comprehensiveness and to continue to add year-over-year program savings • Topical Immunomodulators • Electrolyte Depletors • Urinary Tract Antispasmodics • Lipotropics Non-Statins: Fibric Acid • Lipotropics Non-Statins: Niacin Derivatives • Phosphodiesterase 5 Inhibitors for Erectile Dysfunction • Phosphodiesterase 5 Inhibitor for Pulmonary Arterial Hypertension

  7. PDL Strategy • Encourage addition of PDL classes that will retain a high proportion of utilization in Medicaid and/or will have significant future cost implications • Specialty pharmacy products • Multiple Sclerosis • Immunomodulators

  8. Conclusion • Virginia’s fee-for-service Medicaid program will lose a significant percentage of its drug spend to Medicare effective January 1, 2006 • Classes predominantly used in the elderly and disabled will see the largest reduction in utilization • FHSC will continue to assist the state in maximizing PDL savings through the addition of new drug classes coupled with the continued optimization of the current program

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