Impact of reference-based pricing of nitrates on the use and costs of anti-anginal drugs.

BACKGROUND: Reference-based pricing limits reimbursement for a group of drugs that are deemed therapeutically equivalent to the cost of the lowest-priced product within that group. We estimated the effect of reference-based pricing of nitrate drugs used for long-term prophylaxis on prescribing of and expenditures on nitrates and other anti-anginal drugs dispensed to senior citizens in British Columbia. METHODS: We assessed trends in the monthly volume of prescriptions of anti-anginal drugs and the associated drug ingredient cost paid by the province's publicly funded drug subsidy program, Pharmacare, and by the patients themselves for the period April 1994 to May 1999. Trends in monthly rates of nitrate expenditures per 100,000 senior citizens before the introduction of reference-based pricing were extrapolated to infer what expenditures would have been without the policy. RESULTS: During the 3 1/2 years after reference-based pricing was introduced, Pharmacare expenditures on nitrates prescribed to senior citizens declined by $14.9 million (95% confidence interval $10.7 to $19.1 million). Most of these savings were due to the lower prices that Pharmacare paid for sustained-release nitroglycerin tablets and the nitroglycerin patch, which were the 2 most frequently prescribed nitrates before the introduction of reference-based pricing; $1.2 million (8%) of the savings represented expenditures by senior citizens who purchased drugs that were only partially reimbursed. There were no compensatory increases in expenditures for other anti-anginal drugs. Use of sublingual nitroglycerin--a marker for deteriorating health in patients with angina--did not increase after the introduction of reference-based pricing. The nitroglycerin patch is now the most frequently prescribed nitrate, owing to the fact that Pharmacare resumed the provision of full subsidies for the drug after its manufacturers voluntarily reduced retail prices. INTERPRETATION: Evidence to date suggests that reference-based pricing of nitrates has achieved its primary goal of reducing drug expenditures. The effects of this policy on patient health, associated health care costs and administrative costs remain to be investigated.

Health care policy evaluation using longitudinal insurance claims data: an application of the panel Tobit estimator.

The British Columbia Ministry of Health provides enhanced prescription drug insurance coverage to residents aged 65 and older. This exogenous change in the effective price of prescription drugs is used to investigate aspects of the drug use by seniors. Three sets of issues are of interest. First, what is the effect of enhanced insurance coverage on drug use and programme costs once drugs are provided free of charge? Second, is this effect permanent, or transitory? Third, are any increases in use observed concentrated among those with lower incomes? Longitudinal administrative claims payment data on 18,000 seniors over the period 1985-92 are used. All individuals in the sample turned 65 at some point and therefore became eligible for subsidized prescription drugs. Health status information is not collected; instead, health status is treated as an individual-specific fixed endowment, subject to a common rate of decay. Estimation is complicated by censoring of real drug expenditures for those under 65, rendering 'first differencing' methods invalid. A semi-parametric fixed effects Tobit estimator is used instead. For most individuals, the extension of insurance does not permanently increase drug use. Males with lower income were the exception. Little evidence of transitory effects to insurance coverage was found. Finally, the extension of insurance has made only a minor contribution to growth in seniors' drug use, relative to secular growth in drug use over time.

On becoming 65 in Ontario. Effects of drug plan eligibility on use of prescription medicines.

OBJECTIVES: The authors assess (1) the effects of first-dollar prescription drug insurance coverage provided by the Ontario Drug Benefit plan at age 65 on prescription drug use by seniors, and (2) the differential effects of this coverage on prescription drug use by seniors with varying levels of health status. METHODS: The authors modeled self-reported prescription drug use contained in the 1990 Ontario Health Survey as a function of eligibility for coverage, controlling for health status and other factors. The two-part model was used and was estimated by maximum likelihood. RESULTS: The provision of first-dollar prescription drug insurance coverage at age 65 is associated with an increase in drug use. Increases in drug use are, however, concentrated primarily among individuals with lower levels of health status. Most of the increased use occurs among individuals already under physician supervision, ie, an increase in the level of use among drug users rather than an increase in the probability of use. CONCLUSIONS: As Ontarians turn age 65 and become eligible for publicly subsidized prescription drugs, their use increases but the effect appears to be restricted mainly to persons with lower levels of health status. Given a growing trend toward reduction of public subsidy and increased reliance on patient cost sharing, more research is needed to quantify the use and health effects of such initiatives.

Does it matter whom and how you ask? inter- and intra-rater agreement in the Ontario Health Survey.

A large amount of information in the 1990 Ontario Health Survey (OHS) was collected from proxy respondents using questions administered in face-to-face interviews. Can this type of information represent candid self-reported measures of health status? Inter-rater agreement was assessed using Cohen's kappa statistic for responses to questions that were answered both by individuals about themselves and by proxies on their behalf. Intra-rater agreement, assessing the effect of mode of survey administration (in-person interviews versus self-completed written questionnaires) on the responses, was also investigated using the kappa statistic. We conclude that: (1) proxy responses in the OHS for impairments of emotion and pain are not reliable indicators of self-response (kappa < 0.32) because proxy respondents consistently under-report the burden of morbidity; (2) levels of morbidity reported by subjects to interviewer-administered questionnaires may underestimate morbidity, relative to morbidity reported by subjects using self-administered questionnaires completed in privacy. We also hypothesize that the relative magnitudes of inaccuracy introduced by interviewer administration relative to proxy reporting depends on the phenomenon being measured. When assessing pain, mode of administration is quantitatively a more important source of disagreement than type of respondent.

A comparison of alternative models of prescription drug utilization.

The two-part estimation technique has been advocated for estimating models using individual level health care utilization data characterised by a large proportion of non-consumption and small proportions of heavy users. This paper compares the two-part model to several other estimators, including the Poisson, negative binomial and 'zero altered' negative binomial models on the basis of within-sample forecasting accuracy and non-nested model selection tests. The empirical model estimates the differential effect of the removal of copayments for prescription medicines on the prescription drug utilization by older adults with differing levels of health status. The two-part estimator of this model is found to dominate the competitors. Results from this model indicate that utilization increases appear to be higher among individuals with lower levels of health status.