Medicaid patients' access to new drugs

UPTAKE AND DIFFUSION OF PHARMACEUTICAL INNOVATIONS IN HEALTH SYSTEMS

Multiple interacting factors influence the uptake and diffusion of medicines which are critical to improving health. However, there is a gap in our knowledge on how regulatory policies and other national health systems attributes combine to impact on the utilisation of innovative drugs, and health system goals and objectives.

Our review demonstrates that strong regulation adversely affects, access to innovation, reduces incentives for research-based firms to develop innovative products and leads to short- and long-term welfare losses. Short-term efficiency gains from reducing pharmaceutical expenditures may actually increase total healthcare costs, reduce user choice, and in some cases, adversely affect health outcomes.

Decision makers need to adopt a holistic approach to policy making, and consider potential impact of regulations on the uptake and diffusion of innovations, innovation systems and health system goals.

Systemwide effects of Medicaid retrospective drug utilization review programs

Aggregate pooled cross-sectional and time-series annual state data for 1985 to 1992 were used to estimate the systemwide effects of retrospective drug utilization review programs (Retro-DUR) on Medicaid drug and nondrug outcomes. The results provide evidence that these programs produce significant cost savings in the drug budget without spillover effects (positive or negative) in other nondrug budgets within the Medicaid system. We also examine the influence of restricted formularies in this post-Retro-DUR era on drug and nondrug budgets in the Medicaid system; we find significant cost savings in the former but positive spillover effects in the latter.

What factors influence the prescribing of antidepressant pharmacotherapy? An assessment of national office-based encounters

OBJECTIVE

This study was designed to identify: 1) predictors of antidepressant pharmacotherapy among patients diagnosed with depression; and 2) predictors of prescription for either a selective-serotonin reuptake inhibitor (SSRI), or a serotonin-norepinephrine reuptake inhibitor (SNRI).

METHOD

Data from the 1995 National Ambulatory Medical Care Survey (NAMCS) were used to discern the number of office-based encounters documenting a diagnosis of depression (ICD-9-CM codes 296.2-296.36; 300.4; or 311) among patients eighteen years of age or older. Logistic regression-derived odds ratios (OR) and 95 percent confidence intervals (CI) were used to elucidate factors predictive of receipt of antidepressant pharmacotherapy, and, more specifically, factors predictive of receipt of an SSRI or an SNRI. Model variables included age (18-49 years as compared to > or = 50 years); race (white as compared to nonwhite, inclusive of Hispanics); gender; self-report of depression as a reason for the office-based encounter; and payer type (private insurance program as compared to public).

RESULTS

Among the estimated 18,046,293 office-based visits resulting in a diagnosis of depression, 56.2 percent of patients self-reported depression as a reason for the office-based encounter; 67.5 percent were prescribed or continued a regimen of antidepressant pharmacotherapy; and 48.3 percent were prescribed an SSRI or an SNRI. Factors predictive of receipt of antidepressant pharmacotherapy included age less than fifty years (OR = 1.30, CI = 1.01-1.67); female gender (OR = 1.45, CI = 1.13-1.85); and self-report of depression as a reason for the office-based encounter (OR = 1.98, CI = 1.57-2.51). Factors predictive of receipt of an SSRI or an SNRI included age less than fifty years (OR = 1.31, CI = 1.03-1.65); female gender (OR = 1.55, CI = 1.23-1.95); and self-report of depression as a reason for the office-based encounter (OR = 1.56, CI = 1.25-1.95). In addition, having private insurance increased the likelihood of having been prescribed an SSRI or SNRI by 46 percent (OR = 1.46, CI = 1.13-1.89).

CONCLUSIONS

Among patients with a diagnosis of depression, the pattern of prescribing antidepressant pharmacotherapy is influenced by a patient's age, gender, self-report of depression, and type of insurance coverage. Further research is required to discern the reasons for these observed effects and to advance clinically rational and equitable access to pharmacotherapeutic innovation.

Pharmacy benefit management, cost-effectiveness analysis and drug formulary decisions

Pharmacy benefit management companies (PBMs) have evolved over the past decade in response to the increased demand for health care cost containment. Their activities include the implementation of drug formularies and the negotiation of rebates from manufacturers. Our analysis of this industry is based on interviews and materials provided by the top five ranked PBM companies which account for over 80% of beneficiaries covered within formulary plans. The formularies of these companies are relatively inclusive, but they are becoming more restrictive over time. At present the use of cost-effectiveness (C-E) studies in the formulary decisions of PBMs has been limited. In this regard, the surveyed PBMs emphasized that most C-E studies have not compared therapeutic substitutes in populations with characteristics that are similar to those of their clients. Pharmacy benefit management companies also have had strong incentives to focus narrowly on drug costs because they typically manage drug benefits on a "carved-out" basis. However, PBMs anticipate a growing future role in the integrated management of patient care (disease management) for certain high cost chronic diseases and conditions. All of the leading firms we surveyed have disease management programs in development. The importance of C-E studies to PBM decisions is expected to increase significantly as disease management programs are implemented. The data infrastructure inherent to the PBM industry and the increasing number of employees with advanced training in pharmacoeconomics will permit firms to perform their own internal C-E studies. They are also establishing various alliances and joint ventures with drug manufacturers, health maintenance organizations, and academic institutions to perform these analyses. The leading PBMs tend to favor active participation in the development of methodological approaches to C-E studies over government regulations such as those proposed by the FDA in 1995.

Pharmacy-enforced outpatient drug treatment protocols: a case study of Medi-Cal restrictions for cefaclor

OBJECTIVE

To evaluate whether a pharmacy-enforced treatment protocol successfully limited the use of a high-cost medication to high-risk patients.

DESIGN

A case study cost-effectiveness analysis was conducted to evaluate a treatment protocol for cefaclor. Episodes of care were defined, healthcare expenditures for all services were aggregated, and demographic data were retrieved from a five percent random sample of California Medicaid (Medi-Cal) recipients. Data were available for episodes occurring before cefaclor was made available under Medi-Cal.

SETTING

Medi-Cal added cefaclor to its formulary, limiting its use to patients over 50 years of age with lower respiratory tract infections (LRTIs). The unit of analysis was an episode of outpatient antibiotic treatment.

PATIENTS

Confirmed LRTI episodes and unconfirmed LRTI cefaclor episodes were analyzed, including multiple episodes of treatment for individual patients. A total of 7855 non-cefaclor LRTI episodes and 2556 cefaclor episodes were analyzed.

MAIN OUTCOME MEASURES

The primary outcome measures were healthcare expenditures three months after the initiation of antibiotic therapy, differentiated by type of service.

RESULTS

Physicians directed cefaclor toward higher-risk patients over age 50 years, even in unconfirmed LRTI episodes. Cefaclor use was estimated to reduce posttreatment costs by $388 per patient (p < 0.001), primarily because of reduced hospital expenditures of $366 (p < 0.001).

CONCLUSIONS

Pharmacy-enforced outpatient drug treatment protocols may be a viable alternative to restrictive formularies and prior authorization. In the case of cefaclor, the Medi-Cal treatment protocol appeared to allow high-risk patients better access to a high-cost medication while reducing total posttreatment costs.

Pharmaceutical innovation in the United States. Factors affecting future performance

Fueled by high returns on its investments, the pharmaceutical industry in the United States has flourished for the past 50 years. The regulatory strategy of demanding stringent testing then allowing market-based pricing has allowed private companies to fund ambitious research and development activities with the assurance that these investments will be recovered. However, aggressive managed-care cost-containment strategies threaten the companies' ability to recoup research and development expenses and may affect their willingness to invest in future innovative research.

Utility of a transdermal delivery system for antihypertensive therapy. Part 1

A retrospective evaluation of patient-level Medicaid claims data from two states was undertaken to discern the fiscal utility of transdermally delivered clonidine versus both the oral formulation of clonidine and oral formulations of eight other antihypertensive agents. In the first phase of our two-part study, we compared paid claims data (n = 1,135) from Florida for transdermal and oral clonidine. Multivariate regression analysis was used to evaluate the incremental impact of six variables on health-care expenditures in the first year after patients were given a diagnosis of hypertension. These variables were: age, gender, prior utilization of medical services, regimen complexity, and dosage formulation. Patients prescribed transdermal clonidine experienced a significant (p less than or equal to 0.001) increase in prescription expenditures and significant reductions in the use of physician (p less than or equal to 0.05), laboratory (p less than or equal to 0.10), and hospital (p less than or equal to 0.05) services. Moreover, savings were maximized (p less than or equal to 0.001) where multi-drug regimens incorporated the transdermal delivery system. In the second phase of our study we compared paid claims data (n = 8,894) from South Carolina for transdermal clonidine and for nine oral antihypertensive agents: atenolol, captopril, clonidine, diltiazem, enalapril, metoprolol, prazosin, terazosin, and verapamil-SR. Once again, regression analysis was used, this time to evaluate the incremental impact of five variables on health-care expenditures in the first year post diagnosis: age, gender, prior utilization of medical services, regimen complexity, and Medication Possession Ratio (MPR), an index of compliance. The data from part 2 of our study revealed that patients assigned a b.i.d. oral antihypertensive agent experienced a significant reduction (p less than or equal to 0.05) in MPR and a significant (p less than 0.05) increase in health-care expenditures when compared to patients prescribed the transdermal delivery system and to patients prescribed once-daily oral medications. These data confirm previous findings concerning the impact of complicated dosing regimens on compliance in hypertensive patients. In this two-part paper we report the data from both phases of our study.