Medication adherence leads to lower health care use and costs despite increased drug spending.

Researchers have routinely found that improved medication adherence--getting people to take medicine prescribed for them--is associated with greatly reduced total health care use and costs. But previous studies do not provide strong evidence of a causal link. This article employs a more robust methodology to examine the relationship. Our results indicate that although improved medication adherence by people with four chronic vascular diseases increased pharmacy costs, it also produced substantial medical savings as a result of reductions in hospitalization and emergency department use. Our findings indicate that programs to improve medication adherence are worth consideration by insurers, government payers, and patients, as long as intervention costs do not exceed the estimated health care cost savings.

Does cost sharing really reduce inappropriate prescriptions among the elderly?

Improving prescription drug quality is an essential health policy goal in modern health systems, though evidence on the available instruments to attain such a goal are scarce. Cost sharing has an arguable role in improving the likelihood of an individual obtaining an appropriate prescription. This paper empirically examines the effect of cost sharing for prescription drugs in some dimensions of medication-related quality, namely the probability of inappropriate prescription drug use. Using data from United States seniors from 1996 to 2005, we explore various specifications of the probability of obtaining an inappropriate prescription that corrects for sample selection, endogeneity, and unobserved heterogeneity. Our results suggest a small, but measurable, negative price elasticity for inappropriate drug use to average out-of-pocket drug costs. That is, we find that user fees reduce the use of inappropriate medications, however the elasticity of cost sharing is found to be lower than that of drugs in general. A relatively close to zero price elasticity suggests that expected prescription quality improvements from co-payments are small in the light of our evidence.

Prescription drug coverage among elderly and disabled Americans: can Medicare-Part D reduce inequities in access?

This paper explores the determinants of demand for prescription drug coverage among the elderly population in the United States, using data from the Medical Expenditure Panel Survey (MEPS) and seeks to analyse the impact that the Medicare prescription drug coverage bill (Medicare-Part D) has on Medicare beneficiaries. The results indicate that individuals who are Hispanic, black, or of another race or ethnicity, over the age of 74, not married, in poor health, fall into the low- to middle-income brackets, and have less than a high school degree are more likely to be covered through a public program, more likely to be uninsured for prescription medicine outlays, and less likely to have private prescription drug coverage. The paper concludes that there is cause for considerable concern for low income citizens who have significant prescription drug outlays, and, therefore, the greatest need because their prescription drug costs may not be covered beyond a certain limit unless they reach catastrophic proportions. This continues to raise equity in access concerns among elderly patients.

Policies and incentives for promoting innovation in antibiotic research

High levels of pathogen resistance are rendering current antibiotics obsolete. Coupled with insufficient investment in discovering new treatments, multidrug-resistant infections are an increasingly urgent public health concern. To curb the growth of antibiotic resistance and prevent major morbidity and mortality from multidrug-resistant bacterial infections, the overuse of antibiotics must be addressed and research and development for antibiotics with novel mechanisms of action actively promoted. This requires appropriately designed incentives for health and regulatory systems, in addition to economic incentives to attract academic interest and industry investment. This book, commissioned by the Swedish Government from the European Observatory on Health Systems and Policies, analyses many proposed policies and incentive mechanisms and sheds light on the key issues that will help policy-makers reach informed, concrete decisions on how to avert this potential public health crisis.