A Gap in Efficiency Related To Rising Cost of Pharmaceuticals for the Aging Population

Introduction

Description of the gap
The World Health Organization’s data indicates a significant rise in people’s life
expectancy worldwide in recent years (WHO, 2020). While aging presents an opportunity for
people to pursue new life goals, old age is associated with various health conditions, including
loss of hearing, eye problems, back pains, diabetes, and depression, among others (WHO, 2020).
Additionally, older adults experience several complex health states that cannot be categorized
into separate disease groups. For instance, urinary incontinence falls, frailty, and pressure ulcers
among older adults lead to geriatric syndromes (WHO, 2020). As a result of the health
challenges associated with aging, older adults need a particular healthcare routine to ensure a
higher health-related quality of life. However, the rising cost of pharmaceuticals for the aging
population poses a significant challenge to the efforts aimed at providing a higher quality of life
for older adults.
The cost of pharmaceuticals is significantly higher among individuals aged 65 years and
above than younger people (O’Neill, Hughes, Jamison & Schweizer, 2020). As the world
experiences an increase in the older adults’ population, the expenditure on pharmacological care
for this population is expected to increase. One of the factors contributing to the increasing cost
of pharmaceuticals for older adults is the increasing use of healthcare by this population (O’Neill,
Hughes, Jamison & Schweizer, 2020). Generally, older adults experience more health issues as
compared to younger people, requiring regular medication. An increase in health demands by the
more aging population results in the rising cost of pharmaceuticals to improve their health.
History of the gap

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Early philosophers concentrated on various aging theories while attempting to develop
ways of increasing the life expectancy of the human population, including incorrect diet and loss
of heat and moisture (Aging A.S., 2014). As such, it was believed that healthy eating and
exercise could lead to a healthy old age. However, the 20th Century medical researchers focused
their efforts on older adults’ medical and social care (Aging A.S., 2014). They incorporated the
new technology and improved medication for older adults in improving the health-related quality
of life for this population. The use of sophisticated technology and medicine, combined with an
increase in the number of older adults, is the main driving factor in the increasing cost of
pharmaceuticals for the aging population.
Impact of socioeconomic background of the population on healthcare access
Individuals with lower socioeconomic status experience worse overall health as
compared to those with higher socioeconomic status. Older adults with higher socioeconomic
status can afford the medicines necessary to improve their health-related quality of life. In
contrast, their counterparts with lower socioeconomic status experience struggle in purchasing
the medication (Zhang, Chung, Zhang & Schüz, 2019). As a result, older adults with more
downward socioeconomic status struggle with treatable health conditions without proper
medication, thus negatively affect their health-related quality of life. Additionally, the
cumulative advantage and disadvantage hypothesis argue that the health-related advantages and
disadvantages of socioeconomic status accumulate over time, leading to a higher inequality
range in old age (Zhang, Chung, Zhang, & Schüz, 2019). Generally, the challenges related to the
rising cost of pharmaceuticals for the aging population are more felt by elders with lower
socioeconomic status.
How healthcare delivery to the population is affected by the gap in access

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As a result of the rising cost of pharmaceuticals for the aging population, older adults
who cannot afford medication forego some prescriptions and, in some cases, skip dosages.
Failure to adhere to medical prescription leads to severe health problems, negatively affecting
their health-related quality of life, resulting from missing medication increase the healthcare
expenditure burden. Strict adherence to prescribed medication leads to a higher health-related
quality of life among older adults, reducing pressure on the healthcare system. It is thus
necessary to ensure that older adults receive the pharmaceuticals required to maintain a healthy
life.
Stakeholders in the health sector should come up with methods of ensuring that all older
adults receive medications as prescribed. For instance, physicians should consider medications
prescribed to older adults and their income status. This information could ensure that all
individuals in this population receive medicines as prescribed, despite the differences in
socioeconomic status. Additionally, reference pricing could be used to ensure that older adults
receive medication at the lowest price possible. Medication pricing requires cooperation between
the government and the pharmaceutical companies in healthcare. The government could
persuade pharmaceutical companies to develop the most optimal pricing to ensure that older
adults can afford medicines. Ensuring that all older adults receive prescribed medication could
improve their overall health-related quality of life (O’Neill, Hughes, Jamison & Schweizer,
2020). 
Implications of not addressing the gap
Failure to address the rising cost of pharmaceuticals for older adults could result in a case
where many older adults do not afford prescribed medications, worsening their health. As a
result, most individuals in this population may develop health complications, exerting pressure

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on the healthcare systems. Additionally, non-adherence to medication, due to the rising cost,
could reduce this population’s life expectancy. Therefore, the stakeholders in the healthcare
sector must address the increasing cost of pharmaceuticals for the aging population with urgency.

Existing Initiatives

Healthcare initiatives that were put to address the gap and their goals
Various initiatives have been made to address the gap in efficiency related to the rising
cost of pharmaceuticals for the aging population. The most significant of these initiatives are
Medicare, Medicaid, and the Department of Veterans Affairs (VA). All of these three are
government-run programs.
Specific goals of the initiatives
Medicare is health insurance program that is run by the federal government. The program
assists individuals who are 65 or older regardless of their level of income (HHS, 2015).
However, there are instances where the program also covers individuals who are below 65.
Individuals who have kidney disease or are disabled eligible for coverage under the program
even if they are below 65.
Like Medicare, Medicaid is a is a health insurance program. However, unlike Medicare,
it is run by both the federal and state governments. It also serves individuals who are over 65. Its
other difference with Medicare is that it is only open to individuals who are needy or are from
low-income backgrounds. Other individuals eligible for Medicaid are parents of minor children,
the blind, and the disabled.
The Department of Veterans Affairs (VA) is a healthcare program which caters for the
healthcare needs of veterans and active military service members.
Circumstances around the development of existing initiatives

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Medicare and Medicaid were established in 1965 after President Lyndon B. Johnson
signed the Social Security Act Amendments into law. The two programs were established to help
older people to access health insurance. Before the creation of the two programs, just three fifths
of individuals over 65 had health insurance. Health insurance for older people cost more than
three times that of younger people. The high health insurance costs made it difficult for older
people to access insurance.
The Department of Veterans Affairs (VA) is a successor of similar agencies that have
been running since the founding of the USA. The department was created to provide healthcare
and other support services to both active and retired military servicemen and women. Given the
kind of work that they do, military servicemen and women are at a higher risk of developing
multiple health problems compared to civilian population. It is, therefore, important to have an
agency that caters to their unique needs and pays for the cost of providing for such care.
Resources required to fund existing initiatives
Medicare, Medicaid, and VA are all government-sponsored. The federal government
funds Medicare through premiums paid by recipients and payroll taxes. VA, on the other hand, is
funded by the military through the federal government’s military budget. As for Medicaid, its
funding comes from both federal and state governments. As of 2018, the cost of Medicare was
$750.2 billion while that of Medicaid was $ 597.4 billion (Cussen, 2020). The VA spent $69
billion on provision of healthcare to military veterans in the same year (Congressional Budget
Office, 2018).
Weaknesses in exisiting initiatives

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In the recent past, patient dissatisfaction with care, medical errors, over-utilization of
prescribed drugs, frequent hospitalization, and poor patient outcomes steadily increased among
Medicare beneficiaries. Notably, aged people with several chronic diseases accounted for about
sixty-eight percent of Medicare budgets (Medicare, 2020). Over time, it came out that healthcare
centers failed to follow federal guidelines leading to the conditions mentioned above and implied
continued suffering of the low-income socioeconomic status aging populations. Consequently,
Medicare was mandated to best practices related to coordinated patient care across all
communities. In response to the circumstances as discussed above, Medicare proposed that: first,
health care plans must be evidence-based and show significant statistics on how the plan reduces
the final medical bill and repeated hospitalization; secondly, healthcare personnel must at least
have a bachelors nursing degree, thirdly, intervention plans for diseases should include
consensus-based policies, fourthly, all healthcare programs have to determine goals such as early
detection and intervention of healthcare problems and fifth, medical programs were mandated to
follow three phases – evaluation and planning, implementation and delivery, and re-evaluation
and re-adjustment, if need be, for registered patients (McDonald et al., 2007). It is significant to
note that the Centers for Medicare & Medicaid Services – CMS – facilitated funding for such
projects to improve health care coordination based on the five proposals mentioned above.
Other major weakness of Medicaid and Medicare is that their provider payments are
often lower than rates than those provided by private insurance (Cutler, 2018). Due to this fact,
many providers have not enrolled into the program. The lack of enrollment of many providers
limits the recipients of the program to a small number of providers. Apart from low rates,
Medicare and Medicaid also take longer to reimburse providers when compared to private
insurance providers. This fact also discourages many providers from enrolling into the program.

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As for VA, the main problem is delay in service provision (Cutler, 2018). Veterans often wait for
a long time before they can receive the care that they need. Thus, even though VA helps them to
access healthcare cheaply, the long wait time reduces the quality of care that they receive. Some
have even died while waiting to receive care from various VA facilities.
Proposed Improvements
There are many improvements that can be made to Medicare, Medicaid, and VA to make
them more responsive to the needs of individuals aged 65 and above. For Medicare and
Medicaid, it is important for the government to increase the speed at which it reimburses
healthcare providers. Such a move will attract more providers to the programs thus increasing the
options that the recipients of the programs have. Additionally, their rates should be increased to
make them more competitive. To solve the problems of delays, the VA can use technologies,
such as electronic health records and electronic medical records.
Regulations
Current Medicare and Medicaid regulation
Medicare and Medicaid are regulated by Centers for Medicare and Medicaid Services
(CMS). CMS is an agency within the Department of Health and Human Services. Its role is to
administer major healthcare programs in the nation, including Medicare and Medicaid. As part of
its role, the agency regularly collects and analyzes data regarding various aspects of the nation’s
major healthcare programs (Kagan, 2020). It also produces major research reports related with
the nation’s healthcare. Perhaps its most important work with regards to Medicare and Medicaid
is to reduce or eliminate abuse and fraud within the two programs.
CMS also plays an important role in informing individuals who are enrolled in Medicare
about their healthcare costs and how they can be managed in a more effective manner. For

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instance, healthcare costs often increase each year. As a result of this increase, Medicare
premiums also increase. Medicare’s Part B premiums are usually deducted from an individual’s
Social Security Benefits. Therefore, CMS ensures that all Medicare recipients understand how
their premiums work and the deductibles for different Medicare parts (Kagan, 2020). Having
such information helps older individuals who are enrolled in the program to know how to keep
their healthcare costs low.
CMS’s regulations are important in keeping Medicare and Medicaid costs low. By
eliminating fraud and abuse of the two programs, CMS ensures that the costs of the two
programs remain manageable. Additionally, by providing adequate information to programs’
recipients, CMS helps them to reduce premiums that they pay for the programs.
Regulation level
CMS is an agency under the Department of Health and Human Services. Therefore, it
performs its regulatory role at all levels of government. These levels include federal, state, and
local levels.
Conclusion
Medicare, Medicaid, and VA have been quite effective in addressing high healthcare
costs that were previously beyond the reach of many individuals over 65. These three align with
the Affordable Care Act which was passed in 2010 and which seeks to ensure that every
American has healthcare insurance and has access to quality health care. Since Medicare,
Medicaid, and VA are meant to ensure that all individuals over 65 have healthcare insurance, the
programs perfectly align with the goals of Affordable Care Act.

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Congressional Budget Office (2018, December 21). Possible Higher Spending Paths for
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