State insurance mandates and off‐label use of chemotherapy

Access to cancer drugs used off‐label is important to cancer patients but may drive up healthcare costs with little evidence of clinical benefit. We hypothesized that state health insurance mandates for private insurers to provide coverage for off‐label use of cancer drugs cause higher rates of off‐label use. We used Truven MarketScan data from 1999 to 2007 on utilization of 35 infused chemotherapy drugs in private health plans in the United States, covering the period when eight states implemented off‐label coverage laws. We studied trends in off‐label use of drugs, distinguishing between appropriate and inappropriate off‐label use according to drug compendia, and estimated difference‐in‐difference regressions of the effect of state laws on off‐label use. We estimate 41% of utilization was off‐label, including 17% of use conservatively defined as inappropriate. Trends show gradual declines in off‐label use over time. We also find no discernable effect of state laws mandating coverage of off‐label use of cancer drugs on utilization patterns under multiple empirical specifications. Our conclusion is that policymakers should consider shifting away from mandating coverage as a way to ensure access to drugs off‐label and towards incentivizing adherence to clinical practice guidelines to improve the quality and value of off‐label use.