NCPA - National Center for Policy Analysis


June 11, 2004

Many health plans have increased patient cost sharing to discourage the use of more expensive drugs and to reduce drug spending. A new study suggests they are effective at reaching their goal.

The RAND Corporation conducted a study from 1997 to 2000 to assess how these changes affected the use of the most commonly used drug classes among the privately insured and the chronically ill. They found that doubling copayments was linked to the reduction in use of eight therapeutic classes:

  • The largest decrease was found in anti-inflammatory drugs and anti-histamines, where usage was almost cut in half (about 45 percent).
  • Use of pharmaceuticals designed to treat high cholesterol, ulcers and asthma fell by about one-third.
  • Meanwhile, drugs treating depression, hypertension and diabetes fell by about one-quarter.
  • Among patients diagnosed with a chronic illness and receiving ongoing care, drug use was less responsive to the increases in cost sharing.

Significant increases in copayments raise concern about adverse health consequences because of the large price effects, especially among diabetic patients, according to researchers.

Source: Dana P. Goldman, et al. "Pharmacy Benefits and the Use of Drugs by the Chronically Ill," Journal of the American Medical Association, May 19, 2004, Vol 291, No. 19.

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