Part 'D' for 'Defective': The Medicare Drug-Benefit Chaos

From the New England Journal of Medicine

By Jerry Avorn, MD

SUMMARY: In this NEJM Perspective written shortly after the January 2006 launch of Medicare Part D, Dr. Avorn characterizes the new benefit's implementation as chaotic and harmful to vulnerable patients. Drawing on Kaiser Family Foundation survey data, he documents widespread problems with the benefit's rollout, including pharmacy errors, coverage gaps, formulary confusion, and particular hardship for elderly patients with medical or cognitive disabilities. The piece is an early and sharply critical real-time assessment of a major health policy initiative, arguing that the benefit's structural design — based on private insurance competition rather than a unified government plan — created unnecessary complexity and left the most vulnerable beneficiaries underserved.

BACKGROUND: Medicare Part D — the prescription drug benefit for Medicare beneficiaries — launched in January 2006, implementing coverage through a network of competing private insurance plans.

KEY FINDINGS: A Kaiser Family Foundation survey documented major problems with Part D's implementation, including pharmacy errors, coverage gaps, and formulary confusion, with particular harm to elderly patients with medical or cognitive disabilities.

IMPLICATIONS: The troubled launch of Medicare Part D illustrates the risks of using complex private insurance competition structures to deliver a public benefit, particularly for vulnerable populations who lack the cognitive or informational resources to navigate complicated plan choices.