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Medicaid Prescription Drug Use and Expenditures by State, 1999 to 2009

Medicaid expenditures for prescription drugs grew rapidly between 1999 and 2005, leading states to implement a wide variety of measures to constrain use and costs, while still retaining access to needed medications for vulnerable Medicaid beneficiaries. As shown in the chart below, the implementation of the Medicare Part D drug benefit in 2006 shifted responsibility for drug coverage for over 7 million Medicare-Medicaid dual eligibles from Medicaid to Medicare, reducing Medicaid drug expenditures for prescription drugs by more than half and sharply increasing projected Medicare expenditures.

Sources: CMS National Health Expenditure Projections 2006-2021
National Health Expenditures by Type of Service and Source of Funds, CY 1970-2005

Working with the Centers for Medicare & Medicaid Services (CMS) since 2002, Mathematica has used Medicaid Analytic eXtract (MAX) files to track and analyze these trends on a state-by-state basis for the years 1999 and 2001-2009. The MAX files are prepared from claims and eligibility data that have been submitted electronically by all states to CMS for each year since 1999.

In annual state-by-state and national tables (“Statistical Compendiums”) and accompanying chartbooks, Mathematica has shown drug use and expenditures by beneficiary characteristics (age, sex, and race), basis of eligibility (children, adults, disabled, aged), and type of drug (brand vs. generic, top 10 drug groups, 17 therapeutic categories, and drugs excluded by statute from Medicare Part D). There are separate tables and graphs for dual eligibles and for non-dual beneficiaries.

The tables and chartbook for 2005 show prescription drug use and expenditures for dual eligibles for the last year in which Medicaid provided their drug coverage. These Medicaid data can be compared to Medicare Part D data for dual eligibles for 2006 and subsequent years to assess changes that may have resulted from the 2006 shift in coverage for dual eligibles to Medicare. The Medicaid tables and chartbooks for 2006 through 2009 continue to show Medicaid prescription drug use and expenditures for dual eligibles in separate tables, but Medicaid utilization is quite low in those years.

The tables and chartbooks for 2006 through 2009 also continue to show detailed state-by-state and national information on drug use and expenditures by non-dual Medicaid-only beneficiaries. The September 2011 issue brief and the March 2013 policy brief listed under "Publications" below describe many of the highlights of the utilization by Medicaid-only beneficiaries.

Publications

Statistical Compendiums
Statistical Compendiums (“Medicaid Pharmacy Benefit Use and Reimbursement”) for 1999 and 2001-2009 are all available on the CMS website.

Chartbooks
"Chartbook: Medicaid Pharmacy Benefit Use and Reimbursement in 2009" (December 2012)
"Chartbook: Medicaid Pharmacy Benefit Use and Reimbursement in 2008" (March 2012)
"Chartbook: Medicaid Pharmacy Benefit Use and Reimbursement in 2007" (May 2011)
"Chartbook: Medicaid Pharmacy Benefit Use and Reimbursement in 2006" (May 2010)
“Chartbook: Medicaid Pharmacy Benefit Use and Reimbursement in 2005” (June 2009)
“Chartbook: Medicaid Pharmacy Benefit Use and Reimbursement in 2004” (October 2008)
“Chartbook: Medicaid Pharmacy Benefit Use and Reimbursement in 2003” (April 2008)
“Chartbook: Medicaid Pharmacy Benefit Use and Reimbursement in 2002” (May 2007)
“Chartbook: Medicaid Pharmacy Benefit Use and Reimbursement in 2001” ( December 2006)
“Chartbook: Medicaid Pharmacy Benefit Use and Reimbursement in 1999” (March 2005)

Issue Briefs
"Trends and Patterns in the Use of Prescription Drugs Among Medicaid Beneficiaries: 1999 to 2009." MAX Medicaid Policy Brief #17 (March 2013)
"Prescription Drug Use and Cost Among Medicaid Beneficiaries with Disabilities and Chronic Illnesses." Issue Brief (September 2011)
"Medicaid Prescription Drug Use by Dual Eligibles: Issues for Medicare Part D." Trends in Health Care Financing, Issue Brief #8 (August 2008)
"New Medicaid Drug Use and Cost Data Highlight Issues for States After Medicare Part D." Trends in Health Care Financing, Issue Brief #7 (June 2007)
"Medicaid Drug Use Data Show High Costs and Wide Variation for Dual Eligibles." Trends in Health Care Financing, Issue Brief #5 (August 2005)
"New State Data on Medicaid Drug Use and Cost Can Help States Solve Problems.” Trends in Health Care Financing, Issue Brief #4 (March 2005)

Journal Articles
"Medicaid Beneficiaries with Congestive Heart Failure: Association of Medication Adherence with Healthcare Use and Costs." American Journal of Managed Care (2009)
“Utilization of, and Adherence to, Drug Therapy Among Medicaid Beneficiaries with Congestive Heart Failure.” Clinical Therapeutics (August 2007)
"Prescription Drug Use and Expenditures Among Dually Eligible Beneficiaries."Health Care Financing Review (Summer 2007)