Prescription Drug Copayments Research Articles

HPR22 Copayment for Prescription Drugs Under Taiwan's National Health Insurance: A Cross-Sectional Study, 2008-2017

Studies on the impacts of copayments for outpatient prescription drugs under Taiwan’s National Health Insurance are very limited. The aim of this study is to characterize those who received copayments for prescriptions at outpatient visits and compared them with their counterparts (the copayment-waving group) between 2008 and 2017 in Taiwan. Specifically, patients’ or physicians’ characteristics associated with copayments for prescriptions at outpatient visits were examined.

Correlation Between Changes in Brand-Name Drug Prices and Patient Out-of-Pocket Costs

List prices set by manufacturers for brand-name prescription drugs in the US have been increasing faster than inflation, although confidential manufacturer rebates offset some of these increases. Most commercially insured patients pay at least some out-of-pocket costs for prescription drugs, and higher patient spending is associated with lower adherence and worse health outcomes. To examine whether price changes for brand-name drugs are correlated with changes in patient out-of-pocket spending and whether this association varies by insurance benefit design. A cohort study of 79 brand-name drugs with available pricing data from January 2015 to December 2017 was conducted, with data obtained from a national commercial insurance claims database. Change in the list prices set by manufacturers and estimated net prices after rebates among non-Medicaid payers. Change in median out-of-pocket spending among all patients and stratified by insurance pharmacy benefit design, including high-deductible insurance plans and plans with any amount of deductibles or coinsurance. Among 79 drugs, median increases were 16.7% (interquartile range [IQR], 13.6%-21.1%) for list prices, 5.4% (IQR, -3.9% to 11.7%) for net prices, and 3.5% (IQR, 1.4%-9.1%) for out-of-pocket spending from 2015 to 2017. Changes in list prices were correlated with changes in net prices (r = 0.34; P = .002). Overall, changes in out-of-pocket spending were not correlated with changes in list prices (r = 0.14; P = .22) or net prices (r = 0.04; P = .71). Among 53.7% of patients who paid any drug deductible or coinsurance, median out-of-pocket spending increased by 15.0%, and changes were moderately correlated with changes in list prices (r = 0.38; P = .001) but not net prices (r = 0.06; P = .62). Some commercially insured patients who pay only prescription drug copayments appear to be insulated from increases in drug prices. However, more than half of patients pay deductibles or coinsurance and may experience substantial increases in out-of-pocket spending when drug prices increase. Among these patients, there was no evidence that manufacturer rebates to insurers are associated with patients' out-of-pocket spending. Policies to rein in unregulated annual increases in list prices for brand-name drugs may have important consequences for patient out-of-pocket spending.

The impact of prescription drug co-payments for publicly insured families.

Co-payments for prescription drugs are a common feature of many healthcare systems, although often with exemptions for vulnerable population groups. International evidence demonstrates that cost-sharing for medicines may delay necessary care, increase use of other forms of healthcare and result in poorer health outcomes. Existing studies concentrate on adults and older people, particularly in the US, with relatively less attention afforded to paediatric and European populations. In Ireland, prescription drug co-payments were introduced for the first time for medical cardholders (i.e. those with public health insurance) in October 2010, initially at a cost of €0.50 per item, rising to €1.50 in January 2013, and further increasing to €2.50 in December 2013. Using data from the Growing Up in Ireland longitudinal study of children, and a difference-in-difference research design, we estimate the impact of the introduction (and increase) of these co-payments on health, healthcare utilisation and household financial wellbeing. The introduction of modest co-payments on prescription items was not estimated to impinge on the health of children and parents from low-income families. For the younger Infant Cohort, difference-in-difference estimates indicated that the introduction (and increase) in co-payments was associated with a decrease in GP visits and hospital nights, and a decrease in the proportion of households reporting 'difficulties with making ends meet'. In contrast, for the older cohort of children (the Child Cohort), co-payments were associated with an increase in GP visiting, and an increase in household deprivation. While the parallel trends assumption for difference-in-difference analysis appeared to be satisfied, further investigation revealed that there were other time-varying observable factors (such as exposure to the economic recession over the period) that affected the treatment and control groups, as well as the two cohorts of children differentially, that may partly explain these divergent results. For example, while the analysis suggests that the introduction of the €0.50 co-payment in 2010 was associated with an increase in the probability of treated families in the Child Cohort being deprived by 9.4 percentage points, the proportion of treated families experiencing unemployment and reductions in household income also increased significantly around the time of the co-payment introduction. This highlights the difficulty in identifying the effect of the co-payment policy in an environment in which assignment to the treatment (i.e. medical cardholder status) was not randomly assigned.

Chronic Health Outcomes and Prescription Drug Copayments in Medicaid.

Prescription drug copayments and cost-sharing have been linked to reductions in prescription drug use and expenditures. However, little is known about their effect on specific health outcomes. To evaluate the association between prescription drug copayments and uncontrolled hypertension, uncontrolled hypercholesterolemia, and prescription drug utilization among Medicaid beneficiaries with these conditions. Select adults aged 20-64 from NHANES 1999-2012 in 18 states. Uncontrolled hypertension, uncontrolled hypercholesterolemia, and taking medication for each of these conditions. A differencing regression model was used to evaluate health outcomes among Medicaid beneficiaries in 4 states that introduced copayments during the study period, relative to 2 comparison groups-Medicaid beneficiaries in 14 states unaffected by shifts in copayment policy, and a within-state counterfactual group of low-income adults not on Medicaid, while controlling for individual demographic factors and unobserved state-level characteristics. Although uncontrolled hypertension and hypercholesterolemia declined among all low-income persons during the study period, the trend was less pronounced in Medicaid beneficiaries affected by copayments. After netting out concurrent trends in health outcomes of low-income persons unaffected by Medicaid copayment changes, we estimated that introduction of drug copayments in Medicaid was associated with an average rise in uncontrolled hypertension and uncontrolled hypercholesterolemia of 7.7 and 13.2 percentage points, respectively, and with reduced drug utilization for hypercholesterolemia. As Medicaid programs change in the years following the Affordable Care Act, prescription drug copayments may play a role as a lever for controlling hypertension and hypercholesterolemia at the population level.

The financial burden from prescription drugs has declined recently for the nonelderly, although it is still high for many.

Prescription drug spending and pharmacy benefit design have changed greatly over the past decade. However, little is known about the financial impact these changes have had on consumers. We examined ten years of nationally representative data from the Medical Expenditure Panel Survey and describe trends in two measures of financial burden for prescription drugs: out-of-pocket drug costs as a function of family income and the proportion of all out-of-pocket health care expenses accounted for by drugs. We found that although the percentage of people with high financial burden for prescription drugs increased from 1999 to 2003, it decreased from 2003 to 2007, with a slight increase in 2008. The decline is evidence of the success of strategies to lower drug costs for consumers, including the increased use of generic drugs. However, the financial burden is still high among some groups, notably those with public insurance and those with low incomes. For example, one in four nonelderly people devote more than half of their total out-of-pocket health care spending to prescription drugs. These trends suggest that the affordability of prescription drugs under the future insurance exchanges will need to be monitored, as will efforts by states to increase prescription drug copayments under Medicaid or otherwise restrict drug use to reduce public spending.

Increasing Time Costs and Copayments for Prescription Drugs: An Analysis of Policy Changes in a Complex Environment

To estimate the effect of two separate policy changes in the North Carolina Medicaid program: (1) reduced prescription lengths from 100 to 34 days' supply, and (2) increased copayments for brand name medications. Medicaid claims data were obtained from the Centers for Medicare and Medicaid Services for January 1, 2000-December 31, 2002. We used a pre-post controlled partial difference-in-difference-in-differences design to examine the effect of the policy change on adults in North Carolina; adult Medicaid recipients from Georgia served as controls. Outcomes examined include medication adherence and Medicaid expenditures. Data were aggregated to the person-quarter level. Individuals in HMOs, nursing homes, pregnant, or deceased in the quarter were excluded. Both policies decreased medication adherence. The days' supply policy had a much larger effect on adherence than did the copayment increase. Total Medicaid spending declined from the days' supply policy, but the copayment policy resulted in a net increase in Medicaid expenditures. Although Medicaid costs decreased with the change in days supply policy, these savings were due to reduced adherence to these chronic medications. Additional research should examine the effect of these policy changes from the perspective of Medicaid enrollees.

Increasing Time Costs and Copayments for Prescription Drugs: An Analysis of Policy Changes in a Complex Environment: Increasing Time Costs and Copayments for Prescription Drugs

Increasing Time Costs and Copayments for Prescription Drugs: An Analysis of Policy Changes in a Complex Environment: Increasing Time Costs and Copayments for Prescription Drugs

Co-Pay and Feel Okay: Evidence of Illusory Health Gains from a Health Insurance Reform

The reliability of general self-rated health status is examined using the reform of the public health insurance system of Germany in 2004 as a source of exogenous variation. Among others, the reform introduced a co-payment for ambulatory doctor visits and increased the co-payments for prescription drugs. This natural experiment allows identification of the causal impact of the program on self-assessed health and hence reveals the sensitivity of this subjective measure to a perturbation in the insurance system. Using data from the German Socio-Economic Panel, the results indicate that after the policy intervention, the respondents in the treated group perceived their own health status as better than their hypothetical untreated state even when there is no discernible impact on actual health.

Sustained Hyperglycemia Among Patients With Diabetes

OBJECTIVETo estimate prevalence of, and factors associated with, sustained periods of hyperglycemia among patients with diabetes and factors associated with receipt of appropriate care once A1C values are persistently elevated.RESEARCH DESIGN AND METHODSAmong patients initiating oral monotherapy (n = 5,070), Kaplan-Meier and Cox proportional hazards methods were used to estimate time to, and factors associated with, sustained hyperglycemia (defined by two A1cs >8% and no recent medication intensification), and among those experiencing sustained hyperglycemia, time to, and factors associated with, appropriate receipt of care (i.e., medication intensification or achieving A1C ≤7%).RESULTSWithin 1 year, 8% experienced sustained hyperglycemia, with the proportion rising to 38% within 5 years. Patients using sulfonylurea had greater risk of hyperglycemia (hazard ratio [HR] 1.47 [95% CI 1.30–1.66]) compared with those initiating metformin. Risk increased with age (1.89 [1.27–2.83]), was greater for African Americans (1.19 [1.05–1.36]), and increased with A1C levels >7%. Among individuals with sustained hyperglycemia (n = 1,386), mean time to appropriate care was 9.7 months, with 25% not receiving appropriate care within 1 year. Shorter delays to appropriate care receipt were associated with increasing income (1.03 [1.00–1.07]), A1C >9% (1.38 [1.06–1.79]) and >11% (1.65 [1.25–2.18]), increasing medication adherence (1.03 [1.01–1.04]), and visits to primary care (4.22 [3.65–4.88]) or endocrinology (3.89 [2.26–6.70]). Longer delays were associated with increasing drug copayments (0.96 [0.93–0.98]).CONCLUSIONSPatients incurring sustained hyperglycemia are at risk of further delays in appropriate management. Barriers to appropriate care include prescription drug copayments, few physician contacts, and other factors that are likely amenable to intervention.

Copayments for doctor visits in Germany and the probability of visiting a physician - Evidence from a natural experiment

SUMMARY The German health care reform of 2004 imposes a charge of e 10 for the first visit to a doctor in each quarter of the year. At first glance, there is no inhibiting effect of this fee on utilization in the German Socio-Economic Panel. However, this study reveals that the true effect is diluted by a special characteristic of the fee. Exploiting random variation in the interview date, this study finds a substantial effect of the new fee on the probability of visiting a physician. In addition, the identification strategy makes it possible to disentangle this effect from the influence of the contemporaneous increase of copayments for prescription drugs.

Health Care Reform and Economic Recovery

Health Care Reform and Economic Recovery

Effects of Increased Patient Cost Sharing on Socioeconomic Disparities in Health Care

Increasing patient cost sharing is a commonly employed mechanism to contain health care expenditures. To explore whether the impact of increases in prescription drug copayments differs between high- and low-income areas. Using a database of 6 million enrollees with employer-sponsored health insurance, econometric models were used to examine the relationship between changes in drug copayments and adherence with medications for the treatment of diabetes mellitus (DM) and congestive heart failure (CHF). Individuals 18 years of age and older meeting prespecified diagnostic criteria for DM or CHF were included. Median household income in the patient's ZIP code of residence from the 2000 Census was used as the measure of income. Adherence was measured by medication possession ratio: the proportion of days on which a patient had a medication available. Patients in low-income areas were more sensitive to copayment changes than patients in high- or middle-income areas. The relationship between income and price sensitivity was particularly strong for CHF patients. Above the lowest income category, price responsiveness to copayment rates was not consistently related to income. The relationship between medication adherence and income may account for a portion of the observed disparities in health across socioeconomic groups. Rising copayments may worsen disparities and adversely affect health, particularly among patients living in low-income areas.

Modeling the Potential Impact of a Prescription Drug Copayment Increase on the Adult Asthmatic Medicaid Population

Objectives The Commonwealth of Massachusetts increased the copayment for prescription drugs by $1.50 for Medicaid (MassHealth) beneficiaries in 2003. We sought to determine the likely health outcomes and cost shifts attributable to this copayment increase using the example of inhaled corticosteroids (ICS) use among adult asthmatic Medicaid beneficiaries. Method We compared the predicted costs and health outcomes projected over a 1-year time horizon with and without the increase in copayment from the perspective of MassHealth, providers, pharmacies, and MassHealth beneficiaries by employing decision analysis simulation model. Results In a target population of 17,500 adult asthmatics, increased copayments from 50¢ to $2.00 would result in an additional 646 acute events per year, caused by increased drug nonadherence. Annual combined net savings for the state and federal governments would be $2.10 million. Projected MassHealth savings are attributable to both decreased drug utilization and lower pharmacy reimbursement rates; these more than offset the additional costs of more frequent acute exacerbations. Pharmacies would lose $1.98 million in net revenues, MassHealth beneficiaries would pay an additional $0.28 million, and providers would receive additional $0.16 million. Conclusion Over its first year of implementation, increase in the prescription drug copayment is expected to produce more frequent acute exacerbations among asthmatic MassHealth beneficiaries who use ICS and to shift the financial burden from government to other stakeholders.

Prescription drug co-payments and cost-related medication underuse

Co-payments have been linked to the slowing growth in pharmaceutical spending over the last five years. However, patients with health problems frequently have difficulty affording their pharmacotherapy and fail to take their medication as prescribed. We examine the relationship between co-payment amounts and four types of cost-related underuse: taking fewer doses, postponing taking a medication, failing to fill a prescription at all, and taking medication less frequently than prescribed. We conducted a nationwide survey of US adults age 50 and over who take medication for a chronic condition. Participants provided information on 17 chronic conditions, medication they take for those conditions, and whether they underused any medication due to cost. We analyzed those who reported paying co-payments for their prescriptions (n = 2,869). Analysis involved multivariate logistic regression, with adjustments for survey weights and clustering. Our data show a strong positive association between co-payments and cost-related medication underuse. Although people differ in how they underuse medications, these behaviours are strongly associated with co-payment amount. Realigning the co-payments with cost-effectiveness data, also known as value-based insurance design, warrants further investigation.

Impact of a Medicaid Copayment Policy on Prescription Drug and Health Services Utilization in a Fee-for-Service Medicaid Population

Copayments (copays) for prescription drugs are a common policy among state Medicaid programs. Research exploring the effects of copays on pharmacy and health care utilization in Medicaid patients is limited, especially among patients with chronic disease. The goal of this research was to quantify the impact of a copay policy for prescription drugs on medication and health services utilization overall and among subjects with several common chronic diseases enrolled in a state Medicaid program. Using aggregated pharmacy claims, segmented linear regression models were used to evaluate changes in overall and disease-specific pharmacy utilization after implementation of a copay policy. Trends in emergency department encounters, office visits, and hospitalizations were used to evaluate the impact of this policy on unintended consequences. Utilization among cohorts of patients with several chronic conditions were analyzed to determine if a differential response existed by drug indication. After copay implementation, utilization of prescription drugs declined significantly by 17.2% (P < 0.0001). This pattern was observed at varying degrees for all drug classes investigated. Rates of emergency department encounters, office visits, or hospitalizations did not increase after the policy was introduced. Subjects with diabetes, respiratory disease, and schizophrenia immediately reduced their use of nonindicated drugs significantly more than drugs indicated for their condition. Among Medicaid recipients, nominal copays are associated with significant reductions in use of clinically important drug classes. However, patients with chronic disease exhibited a differential response depending on the disease indication of the drug class.

Integrated Insurance Design in the Presence of Multiple Medical Technologies.

The classic theory of moral hazard concerns the insurance of a single good and predicts that co-insurance is larger when the elasticity of demand is higher and when small risks are insured. We extend this analysis to the insurance of multiple goods; for example, the simultaneous insurance of medical services and prescription drugs. We show that when multiple goods are either complements or substitutes--so that a change in co-insurance for one service affects the demand of others--the classic moral hazard results do not hold. For example, the single good model would predict high co-payments for prescription drugs since drug demand is elastic and of modest financial risk. However, a model of multi-good insurance suggests such drug coverage may optimally involve zero or even negative co-insurance when it is a substitute to other services insured such as hospital care or physician services. We summarize some of the empirical evidence in support of markets adopting optimal integrated pricing structures rather than individually optimal pricing structures.

Is Drug Coverage a Free Lunch? Cross-Price Elasticities and the Design of Prescription Drug Benefits

Recently, many U.S. employers have adopted less generous prescription drug benefits. In addition, the U.S. began to offer prescription drug insurance to approximately 42 million Medicare beneficiaries in 2006. We use data on individual health insurance claims and benefit data from 1997-2003 to study the effects of changing consumers' co-payments for prescription drugs on the quantity demanded and expenditure on prescription drugs, inpatient care and outpatient care. We allow for effects both in the year of the co-payment change and in the year following the change. Our results show that increases in prescription drug prices reduce both the use of and spending on prescription drugs. However, consumers substitute the use of outpatient care and inpatient care for prescription drug use, and about 35% of the expenditure reductions on prescription drugs are offset by the increases in other spending.

Effect of the Medicare Prescription Drug Improvement and Modernization Act on the bottom line

An historical perspective on the impact of the Medicare Prescription Drug Improvement and Modernization Act (MMA) on pharmaceutical reimbursement, and the financial bottom line at health systems and various strategies to use in the inpatient and outpatient setting to improve the bottom line are described. Implementation of MMA has affected the entire healthcare continuum by reducing pharmaceutical reimbursement rates and health system revenues and increasing prescription drug copayments, emergency department visits, and hospital admissions. Physician-owned clinics are less profitable than in the past because of MMA, which may prompt clinic closures and shift the patient care burden to clinics at public hospitals. Negotiating carve-outs for costly drugs and evaluating the feasibility of obtaining outlier payments can improve the bottom line in the hospital inpatient setting. Ensuring that billing codes are accurate and verifying that reimbursement was received can help minimize the impact of MMA on the financial bottom line in the outpatient setting. Negotiating favorable purchasing contracts and ensuring that drugs are used appropriately by following evidence-based guidelines can improve the financial bottom line in both the inpatient and outpatient settings. Strategies to decrease drug acquisition costs and increase reimbursement rates can help minimize the adverse impact of MMA on the financial bottom line at health systems.

Health Care Advocates Worry About Proposed '07 Budget

Back to table of contents Previous article Next article Government NewsFull AccessHealth Care Advocates Worry About Proposed '07 BudgetRich DalyRich DalySearch for more papers by this authorPublished Online:18 Aug 2006https://doi.org/10.1176/pn.41.16.0014The Senate Appropriations Committee approved a draft Fiscal 2007 Labor-HHS-Education spending bill in late July that raised the possibility that Congress may approve the primary mental health spending measure before the next fiscal year begins.The bill (S 3708) would provide $142.8 billion in health-related discretionary spending, which is $5 billion more than President Bush requested and $1.3 billion more than the Fiscal 2006 amount. The House version (HR 5647) would provide $141.9 billion for discretionary programs. The rest of the funding in both health budget bills is allocated for Medicare, Medicaid, and other entitlement programs.“While [the Senate's funding level] amounts to a modest dollar increase in health spending, it is still higher than the House's version,” said Nicholas Meyers, director of APA's Department of Government Relations.The Senate bill would provide $28.5 billion for the National Institutes of Health (NIH), an increase of $220 million over Fiscal 2006 and $200 million over the president's budget request.The House version, which also provides $28.5 billion for NIH, has been approved by that chamber's Appropriations Committee.Congressional negotiators will reconcile differences in the two versions after both chambers pass their versions of the bill.Rep. David obey (D-Wis.) criticized the proposed budget for NIH as insufficient, given a “substantial” inflation in research costs. Sen. Arlen Specter (R-Pa.) said that even in the more-generous Senate version, NIH funding is $3.78 billion below the inflation-adjusted Fiscal 2006 level.For the three mental health institutes within NIH, the Senate measure would provide $1.4 billion to the National Institute of Mental Health (NIMH), $1 billion to the National Institute on Drug Abuse, and $436 million to the National Institute on Alcohol Abuse and alcoholism. These amounts are similar to the current year's funding levels for the three institutes.The Senate bill would provide $3.34 billion for the Substance Abuse and Mental Health Services Administration (SAMHSA), an increase of $77 million over the president's budget request. SAMHSA is responsible for supporting mental health programs and alcohol and other drug abuse prevention and treatment services.The Senate bill would restore the $630 million for SAMHSA's Community Services Block Grant, which was proposed for elimination in the president's budget.Proposed Budgets for VAThe Senate Appropriations Subcommittee on Military Construction, Veterans Affairs, and Related Agencies approved a $94.3 billion Fiscal 2007 Military Construction-VA appropriations bill (HR 5385). Of that amount, $77.9 billion is earmarked for the Department of Veterans Affairs, which includes health care spending for veterans. The bill, however, does not include a proposal from the president to increase TRICARE fees for some veterans. President Bush had requested an increase in premiums for some veterans and their families in TRICARE, the program that funds health care for this population, as well as higher enrollment fees, deductibles, and prescription drug copayments for some military retirees. The House bill, which would allocate $36.5 billion for VA discretionary programs, also does not include the proposal.Both the House and Senate bills would provide $32.7 billion for the Veterans Health Administration and $3.6 billion for VA medical facilities.The House's allocation for the overall VA spending bill is $136.1 billion. It is dramatically higher than the Senate's $94.3 billion total because the House bill would fund some defense accounts that the Senate bill would not, including the Defense Health Program. Following Senate passage, negotiators will have to hammer out differences between the House and Senate versions of the bill.Family Treatment AddressedIn addition to its work on a health care funding bill, the Senate passed legislation concerning children who are placed in the child welfare system because they are affected by methamphetamine use. The Improving Outcomes for Children Affected by Methamphetamine Act of 2006 (S 3525) amends the Promoting Safe and Stable Families program to reserve $40 million for grants to create regional partnerships to improve outcomes for children affected by methamphetamine abuse or addiction. This bill was sponsored by Sen. Charles Grassley (R-Iowa), and the president is expected to sign the measure.“By emphasizing comprehensive family treatment, we are promoting a promising strategy for families to recover from meth addiction together,” Grassley said at a hearing on the bill.Information about the Labor-HHS bill is posted at<http://thomas.loc.gov/cgi-bin/bdquery/z?d109:h.r.05647:>; the Senate version of the VA spending bills is posted at<http://thomas.loc.gov/cgi-bin/bdquery/z?d109:h.r.05385:>.▪ ISSUES NewArchived

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