Researchers who analyzed Medicare claims before and after the addition of prescription drug coverage in 2006 found the benefit trimmed about $1,200 a year that would have been spent on care in nursing home and hospitals.
The savings on medical care was calculated by comparing people who had little or no drug coverage before Medicare Part D was offered with those who had pretty good benefits all along.
Add up the savings, and the results suggest that the prescription medicine benefit is trimming around $12 billion a year in spending on medical care, the Associated Press reports. Still, federal spending on the drug benefit is about five times that amount, so it's not as if the savings on care offset all the drug costs.
The study by researchers from Harvard looked at data for a sample of about 6,000 people age 65 and up from around the nation. The results appear in the latest issue of JAMA, the Journal of the American Medical Association.
The study wasn't able to figure out which drugs gave the most bang for the buck because of statistical limitations.
Even so, there are hints from previous research, which suggest better drug coverage makes it more likely people with chronic conditions, such as diabetes and high blood pressure, will get prescriptions for medicines that reduce or prevent complications that require additional treatment.