HCP Professor of Health Care Policy Joseph P. Newhouse, PhD, and colleagues studied the consequences of limits on prescription-drug benefits for certain Medicare beneficiaries enrolled in the Kaiser Permanente health plan. The researchers compared the clinical and economic outcomes in 2003 of Medicare+Choice beneficiaries whose annual drug benefits were capped with those whose drug benefits were unlimited because their prior employers supplemented the Kaiser benefits.

Dr. Newhouse and colleagues found important consequences: the cap on drug benefits was associated with lower drug consumption and unfavorable clinical outcomes; the cap was associated with poorer adherence to drug therapy and poorer control of blood pressure, lipid levels, and glucose levels in patients with chronic disease; and the unintended consequence that the savings in drug costs from the cap were offset by increases in the costs of hospitalization and emergency department care. The full article is available on the New England Journal of Medicine website.

The study’s authors and the article will be honored at the Annual Research Meeting of AcademyHealth in June 2007.