The Impact of Reference Pricing of Nonsteroidal Anti-Inflammatory Agents on the Use and Costs of Analgesic Drugs

Objective. To estimate the effect of reference pricing (RP) of nonsteroidal anti-inflammatory drugs (NSAIDs) on drug subsidy program and beneficiary expenditures on analgesic drugs.
Data Sources/Study Setting. Monthly claims data from Pharmacare, the public drug subsidy program for seniors in British Columbia, Canada, over the period of February 1993 to June 2001.
Study Design. RP limits drug plan reimbursement of interchangeable medicines to a reference price, which is typically equal to the price of the lowest cost interchangeable drug; any cost above that is borne by the patient. Pharmacare introduced two different forms of RP to the NSAIDs, Type 1 in April 1994 and Type 2 in November 1995. Under Type 1 RP, generic and brand versions of the same NSAID are considered interchangeable, whereas under Type 2 RP different NSAIDs are considered interchangeable. We extrapolated average reimbursement per day of NSAID therapy over the months before RP to estimate what expenditures would have been without the policies. These counterfactual predictions were compared with actual values to estimate the impact of the policies; the estimated impacts on reimbursement rates were multiplied by the postpolicy volume of NSAIDS dispensed, which appeared unaffected by the policies, to estimate expenditure changes.
Principal Findings. After Type 2 RP, program expenditures declined by $22.7 million (CAN), or $4 million (CAN), annually cutting expenditure by about half. Most savings accrued from the substitution of low-cost NSAIDs for more costly alternatives. About 20 percent of savings represented expenditures by seniors who elected to pay for partially reimbursed drugs. Type 1 RP produced one-quarter the savings of type 2 RP.
Conclusions. Type 2 RP of NSAIDs achieved its goal of reducing drug expenditures and was more effective than Type 1 RP. The effects of RP on patient health and associated health care costs remain to be investigated.     

More cost-sharing,less cost? Evidence on reference price drugs

This paper evaluates the causal effects of changes in reference prices (RP) on prices, copayments, and overall expenditures for off-patent pharmaceuticals. With reference pricing, firms set prices freely and the health plan covers the expenses only up to a certain threshold. We use quarterly data of the German market for anti-epileptics at the package level and at the active substance level and exploit that the RP has been adjusted in some of the active substances but not in others in a difference-in-differences framework. At the product level, we find that a lower RP reduces prices for both brand-name drugs and generics, but leads to higher copayments, especially for brand-name drugs. At the aggregate level, we find that a lower RP leads to savings for the public health insurer since revenues decrease substantially for brand-name firms and, to a lesser extent, also for generic firms. Overall expenditures (payments by the health insurer and the patients) for brand-name drugs decrease in proportion to the decrease in the RP, while the adjustment does not significantly influence overall expenditures for generics.     

The impact of China's retail drug price control policy on hospital expenditures: a case study in two Shandong hospitals

In China, 44.4% of total health expenditures in 2001 were for pharmaceuticals. Containment of pharmaceutical expenditures is a top priority for policy intervention. Control of drug retail prices was adopted by the Chinese government for this purpose. This study aims to examine the impact of this policy on the containment of hospital drug expenditures, and to analyze contributing factors. This is a retrospective pre/post-reform case study in two public hospitals. Financial records were reviewed to analyze changes in drug expenditures for all patients. A tracer condition, cerebral infarction, was selected for in-depth examination of changes in prices, utilization, expenditures and rationality of drugs. In the two hospitals, a total of 104 and 109 cerebral infarction cases, hospitalized respectively before and after the reform, were selected. Prescribed daily dose (PDD) was used for measuring drug utilization, and the contribution of price and utilization to changes in drug expenditures were decomposed. Rationality of drug use post-reform was reviewed based on published literature. Drug expenditures for all patients still increased rapidly in the two hospitals after implementation of the pricing policy. In the provincial hospital, drug expenditures per patient for cerebral infarction cases declined, but not significantly. This was mainly attributable to reduced utilization. In the municipal hospital, drug expenditure per patient increased by 50.1% after the reform, mainly due to greater drug utilization. Three to five fold higher drug expenditure per inpatient day in the provincial hospital was due to use of more expensive drugs. Of the top 15 drugs for treating cerebral infarction cases after the reform, 19.5% and 46.5% of the expenditures, in the provincial and municipal hospitals, respectively, were spent on drugs with prices set by the government. A large proportion of expenditures for the top 15 drugs, at least 65% and 41% in the provincial and municipal hospitals, respectively, was spent on allopathic drugs without an adequate evidence base of safety and efficacy supporting use for cerebral infarction. Control of retail prices, implemented in isolation, was not effective in containing hospital drug expenditures in these two Chinese hospitals. Utilization, more than price, determined drug expenditures. Improvement of rational use of drugs and correcting the present incentive structure for hospitals and drug prescribers may be important additional strategies for achieving containment of drug expenditures.     

Economic impact of regulating the use of amalgam restorations

OBJECTIVE: This article estimates the financial impact of a ban on amalgam restorations for selected population groups: the entire population, children, and children and women of childbearing age. METHODS: Using claim and enrollment data from Delta Dental of Michigan, Ohio, and Indiana and the American Dental Association Survey of Dental Services Rendered, we estimated the per capita use and annual rate of change in amalgam restorations for each age, gender, and socioeconomic subgroup. We used population projections to obtain national estimates of amalgam use, and the dental component of the Consumer Price Index to estimate the annual rate of change in fees. We then calculated the number of dental amalgams affected by the regulation, and the fees for each of the years 2005 to 2020. RESULTS: If amalgam restorations are banned for the entire population, the average price of restorations before 2005 and after the ban would increase $52 from $278 to $330, and total expenditures for restorations would increase from $46.2 billion to $49.7 billion. As the price of restorations increases, there would be 15,444,021 fewer restorations inserted per year. The estimated first-year impact of banning dental amalgams in the entire population is an increase in expenditures of $8.2 billion. CONCLUSIONS: An amalgam ban would have a substantial short- and long-term impact on increasing expenditures for dental care, decreasing utilization, and increasing untreated disease. Based on the available evidence, we believe that state legislatures should seriously consider these effects when contemplating possible restrictions on the use of amalgam restorations.     

Price cuts and drug spending in South Korea: The case of antihyperlipidemic agents

Objective

To identify the effect of price control policies on drug expenditure in South Korea.

Methods

We retrospectively examined the effects of price-reduction policies on drug expenditures, in particular regarding anti-hyperlipidemic drugs. The National Health Insurance claims data for a 60-month period between 2006 and 2010 were analysed. A segmented regression analysis was conducted with three intervention variables: July 2008, April 2009, and January 2010.

Results

Despite three rounds of price cuts, monthly drug expenditures increased by KRW 599.67 million (USD 523,726) after the third intervention (p = 0.0781). The trend in volume increased consistently, but not significantly. The unit prices showed a steady downward trend over time, but rebounded after the third price cut. The number of patients with hyperlipidemia more than doubled to 3729 (p = 0.0801) per month after the entry of generics for atorvastatin in July 2008.

Conclusion

Extensive price controls did not effectively suppress the growth of pharmaceutical expenditures. The increased number of patients, attributable to the newly launched generic drug atorvastatin, and the increased use of expensive drugs were major factors affecting the increase in drug spending. Policies that regulate both drug prices and utilisation, and that reduce financial burdens via enhanced use of generics need to be introduced.     

The effect of the implementation of low price medicine policy on medicine price in China: A retrospective study

In an effort to relieve the pressure of drug shortages, the Chinese government implemented Low‐price Medicines (LPM) policy to raise the price cap in July 2014. The purpose of this study is to examine the effect of the implementation of this policy on drug price in China. Price data of 491 LPM, including 218 low‐price chemical medicines (LPCM) and 273 low‐price traditional Chinese medicines (LPTCM), were collected from 699 hospitals. We used interrupted time series design to identify the variation of monthly Laspeyres Indexes (LI) and Paasche Indexes (PI) for LPM, LPCM, and LPTCM. The result demonstrated that although LPM expenditures increased, the proportion of LPM expenditures accounting for all medicine expenditures fell from 3.6% to 3.2%. After the implementation of LPM policy, there was a significant increasing trend in LPM‐PI, LPCM‐PI, and LPTCM‐PI. The trend in LPM‐LI and LPCM‐LI was found from descending to rising. However, for LPTCM, the trend in the LI remained to decrease after the policy implementation. Despite the LPM policy had an increasing impact on the LPM drug price, the proportion of LPM expenditures accounting for all medicine expenditures did not increase. More efforts are needed in the future to promote the rational drug use in China.     

State-level estimates of annual medical expenditures attributable to obesity

OBJECTIVE: To provide state-level estimates of total, Medicare, and Medicaid obesity-attributable medical expenditures. RESEARCH METHODS AND PROCEDURES: We developed an econometric model that predicts medical expenditures. We used this model and state-representative data to quantify obesity-attributable medical expenditures. RESULTS: Annual U.S. obesity-attributable medical expenditures are estimated at $75 billion in 2003 dollars, and approximately one-half of these expenditures are financed by Medicare and Medicaid. State-level estimates range from $87 million (Wyoming) to $7.7 billion (California). Obesity-attributable Medicare estimates range from $15 million (Wyoming) to $1.7 billion (California), and Medicaid estimates range from $23 million (Wyoming) to $3.5 billion (New York). DISCUSSION: These estimates of obesity-attributable medical expenditures present the best available information concerning the economic impact of obesity at the state level. Policy makers should consider these estimates, along with other factors, in determining how best to allocate scarce public health resources. However, because they are associated with large SE, these estimates should not be used to make comparisons across states or among payers within states.     

基层医疗机构实行药品零差价后对居民医疗费用变化的影响因素分析

国家新的医药卫生制度改革方案已经出台,基本药物零差价销售即是贯彻落实国家卫生制度改革方案的具体措施。通过分析辖区内镇街卫生院实行药品零差价后对居民医疗费用变化的影响因素,进而讨论如何降低居民医疗费用和推进国家基本药物制度的顺利实施。     

从医生激励机制分析公立医院改革要点

从医疗服务的经济学属性角度分析了医生激励机制是公立医院改革的核心，并以取消药品加成为分界，对改革前后医生激励的成本收益进行分析，建立医生效用最大化模型。提出了基于医生激励机制的公立医院改革要点，以实现公立医院的可持续发展。     

北京医药分开试点成效及启示——以北京朝阳医院为例

目的:以北京市朝阳医院为例,分析北京市医药分开改革试点三年来所取得的成效,为公立医院改革提出建议。方法:收集医药分开试点前后门诊和住院的相关数据,对药占比、次均药费、业务量、医疗质量、收入及结构进行比较分析。结果:改革第三年与改革前一年相比,门诊、住院药占比分别下降16.98个百分点和13.3个百分点,年均降幅分别为25.57%和36%;门诊、住院患者次均/例均药费分别下降21.39%和34.8%。医疗收入较改革前增加68.1%;药品收入较改革前下降14.29%。医事服务费收入达到24 350万元。检查、化验收入增加52.60%。讨论:试点医院医药分开对于控制药品费用效果良好。建议:公立医院改革下一步应朝着"医检分开"、调整医疗服务价格等方向推进。     

Reference pricing with endogenous generic entry

Reference pricing intends to reduce pharmaceutical expenditures by increasing demand elasticity and stimulating generic competition. We develop a novel model where a brand-name producer competes in prices with several generics producers in a market with brand-biased and brand-neutral consumers. Comparing with coinsurance, we show that reference pricing, contrary to policy makers’ intentions, discourages generic entry, as it induces the brand-name producer to price more aggressively. Thus, the net effect of reference pricing on drug prices is ambiguous, implying that reference pricing can be counterproductive in reducing expenditures. However, under price regulation, we show that reference pricing may stimulate generic entry, since a binding price cap weakens the aggressive price response by the brand-name producer. This may explain mixed empirical results on the competitive effects of reference pricing. Finally, we show that reference pricing may be welfare improving when accounting for brand preferences despite its adverse effects on entry and prices.     

药品价格调整及集中招标采购对患者药品费用负担的影响

中国医科大学附属第一医院2002年7月－9月间药品实际销售金额为3780．4万元，按2001年6月1日时政策允许的最高零售价格计算可销售4167．2万元，药品实际销售金额降低了9．3％（386．8万元／6167．2万元），其中政府调价因素致药品零售总额下浮4．0％（1671万元／4167．2万元），统一招标采购因素致药品零售总额下浮4．3％（179．8万元／4167．2万元），其他因素致药品零售总额下浮0．95％（39．9万元／4167．2万元。这一结果证实了政府调价及集中招标采购政策的实施已在一定程度上减轻了社会的药品费用负担，但评估降低药品零售价格的措施对降低社会总药品费用的影响程度是一个复杂的过程，参与因素较多，单纯以某类或某品牌药品价格降低的幅度并不能准确反映社总药品费用减轻的程度。     

医药价格改革对医疗费用和医保支出的影响——基于江苏省南京市区级公立医院的分析

目的：评价南京区级公立医院医药价格改革方案的合理性和可行性。方法：通过对南京市区级公立医院医药价格改革前后医疗费用数据的测算调研,模拟分析医保基金支出等重点指标的变化。结果：已试点的江宁区医院门诊和住院次均费用均下降,个人负担率住院持平、门诊有升有降。经模拟测算,即将推进改革的其它4个区级医院门诊和住院药占比、次均门诊费用均有所下降,次均住院费用上升,住院费用个人负担下降3.21个百分点,住院费用医保统筹基金增加支出占实际基金支出的7.74％。结论：医药价格改革减轻了患者个人负担;医保基金支出增加,风险有待防范;医药价格结构调整趋向合理,医疗技术和医护服务价值得到体现,补偿率偏高地区个人和医保统筹基金支出均增加。建议：破除“以药补医”机制,引导参保人员合理分流,推进医保支付方式改革,医保基金市级统筹、城乡统筹相结合,促进县级公立医院改革良性发展。     

Marginal benefit incidence of public health spending: evidence from Indonesian sub-national data

We examine the marginal effects of decentralized public health spending by incorporating estimates of behavioural responses to changes in health spending in benefit incidence analysis. The analysis is based on a panel dataset of 207 Indonesian districts over the period from 2001 to 2004. We show that district public health spending is largely driven by central government transfers, with an elasticity of around 0.9. We find a positive effect of public health spending on utilization of outpatient care in the public sector for the poorest two quartiles. We find no evidence that public expenditures crowd out utilization of private services or household health spending. Our analysis suggests that increased public health spending improves targeting to the poor, as behavioural changes in public health care utilization are pro-poor. Nonetheless, most of the benefits of the additional spending accrued to existing users of services, as initial utilization shares outweigh the behavioural responses.     

Negotiating antiretroviral drug prices: the experience of the Andean countries

OBJECTIVES: This study analyses the effect of the Andean countries' June 2003 negotiation of antiretroviral drug (ARV) prices. The objectives were to assess the problems faced during the negotiation process, to evaluate the impact of the negotiation on ARV prices, and to identify factors that could make it difficult for countries to implement the results of the negotiation. METHODS: Price information of ARVs purchased by public programmes during 2004 was collected from the ministries of health. A survey of the ministries of health was conducted using a questionnaire with information related to the countries' health care and drug regulations and policies. Interviews with a convenient sample of key Andean health authorities and other stakeholders were also conducted. RESULTS: Study results show that the negotiation did achieve lower prices and higher quality and bioequivalence standards for ARVs. However, in general, the public health care programmes of the six countries analysed did not purchase ARVs from the companies that participated in the negotiation, nor did they base purchases on the prices or quality and bioequivalence criteria established in the negotiation. Prices paid by the Andean countries' public programmes in 2004 were a weighted average of 65% higher than the negotiated prices; and this difference in negotiated prices vs. actual prices represented 39.5% of the programmes' ARV expenditures in 2004, or US$18 million in ARV expenditures. CONCLUSION: The successful development and implementation of multinational price negotiations requires that participant countries coordinate pharmaceutical regulations and policies, and pool procurement processes.