A study published in the Journal of the American Medical Association (JAMA) found that that the Medicare Prescription Drug Program (Part D) was associated with a significant decline in non-drug expenditures among enrollees with previously inadequate drug coverage.  By increasing access to medication and adherence to drug regimens, the study found that Part D reduced hospital and nursing home spending on acute and post acute care.  Among the roughly 10 million beneficiaries with previously inadequate care, the authors found that spending on non-drug services declining by $1,200 per capita.

McWilliams, Michael J., Zaslavsky, Alan M., and Huskamp, Haiden A. (2011). Implementation of Medicare Part D and nondrug medical spending for elderly adults with limited prior drug coverage. The Journal of the American Medical Association, 306 (8): 402-409. doi: 10.1001/jama.2011.1026. http://jama.ama-assn.org/content/306/4/402.short 

Authors: Michael J. McWilliams, Alan M. Zaslavsky, and Haiden A. Huskamp.