How Do Prescription Drugs Affect the Use of Other Health Services?

IB#18-3

The brief’s key findings are:

  • Medicare Part D, introduced in 2006, has increased spending on prescription drugs for the elderly, but its impact on other health spending is unclear.
  • The analysis addresses this issue by examining the use of other health care before and after Part D was introduced.
  • The results show that the impact of Part D varied by the type of service:
    • It significantly increased spending on office visits, for purposes such as monitoring the effects of the drugs.
    • But it may have decreased spending on hospital visits by reducing the need for more intensive care, such as surgery.
  • Further research is needed to detect any changes in health spending that may only show up in the longer term.