What happens to drug use and expenditure when cost sharing is completely removed? Evidence from a Canadian provincial public drug plan.

OBJECTIVES: The role of cost-sharing for medicines is under active policy discussion, including in proposals for value-based insurance design. To inform this debate, we estimated the impact of completely removing cost-sharing on medication use and expenditure using a quasi-experimental approach. METHODS: Fair PharmaCare, British Columbia's income-based public drug plan, includes a household out-of-pocket limit. Therefore, when one household member starts a long-term high-cost drug surpassing this maximum, cost-sharing is completely removed for other family members. We used an interrupted time series design to estimate monthly prescriptions and expenditures of other household members, 24 months before and after cost-sharing removal. RESULTS: We studied 2191 household members newly free of cost-sharing requirements, most of whom had lower incomes. R emoving cost-sharing increased the level of drug expenditure and prescription numbers by 16 and 19%, respectively (i.e. $2659.43 (95%$1507.27-$3811.59, p < 0.001); 50.0 (95%CI 25.1-74.9, p < 0.001)) relative to prior expenditures and utilization without changing pre-existing trends. Much of this change was driven by 533 individuals initiating medication for the first time after cost-sharing removal. This initiation substantially increased average expenditure, especially for antiviral agents. CONCLUSIONS: Completely removing cost-sharing, independent of health status, significantly increased medication use and expenditure particularly due to medicine initiation by new users. While costs may be preventing use, the appropriateness of additional use, especially among new users, is unclear.

Impact of brand drug discount cards on private insurer, government and patient expenditures.

BACKGROUND: Brand discount cards have become a popular way for patients to reduce out-of-pocket spending on drugs; however, controversy exists over their potential to increase insurers' costs. We estimated the impact of brand discount cards on Canadian drug expenditures. METHODS: Using national claims-level pharmacy adjudication data, we performed a retrospective comparison of prescriptions filled using a brand discount card matched to equivalent generic prescriptions between September 2014 and September 2017. We investigated the impact on expenditures for 3 groups of prescriptions: those paid only through private insurance, those paid only through public insurance and those paid only out of pocket. RESULTS: We studied 2.82 million prescriptions for 89 different medications for which brand discount cards were used. Use of discount cards resulted in 46% higher private insurance expenditures than comparable generic prescriptions (+$23.09 per prescription, 95% confidence interval [CI] $22.97 to $23.21). Public insurance expenditures were only slightly higher with cards: an increase of 1.3% or $0.37 per prescription (95% CI $0.33 to $0.41). Finally, out-of-pocket transactions using a card resulted in mean patient savings of 7% or $3.49 per prescription (95% CI -$3.55 to -$3.43). The impact varied widely among medicines across all 3 analyses. INTERPRETATION: The use of brand discount cards increased costs to private insurers, had little impact on public insurers and resulted in mixed impacts for patients. These effects likely resulted from private insurers reimbursing brand drug prices even when generics were available and from discount cards being adjudicated after claims were sent to other insurers in most cases. Patients and their clinicians should recognize that discount cards have mixed impacts on out-of-pocket costs.