Medication use characteristics in the elderly: the Iowa 65+ Rural Health Study.

Medication use was studied in a rural, elderly population. Household interviews were conducted of 3,467 individuals aged 65 years or older. A total of 9,955 prescription or nonprescription drugs were reported by the respondents. The overall mean number of drugs per respondent was 2.87, while 12% of all respondents were not taking any drugs. Mean prescription and overall drug use increased significantly with increasing age (P less than .001), while mean nonprescription drug use was relatively constant across age groups. Significantly more women were prescription and nonprescription drug users. Directions for scheduled daily dosing accounted for 75% of all directions. The majority of prescription and nonprescription drugs had been taken on the previous day. General practitioners accounted for more prescription drugs (39.7%) than any other medical specialty. The most frequently stated purpose was cardiovascular for prescription drugs and musculoskeletal for nonprescription drugs. The three most frequent prescription drug therapeutic categories were cardiovascular (54.7%), central nervous system (CNS) agents (11.4%), and analgesics (9.4%). For nonprescription drugs, the three most frequent therapeutic categories were analgesics (39.6%), vitamins and minerals (32.9%), and laxatives (14.1%). Implications of these findings are discussed.

Use and costs under the Iowa capitation drug program.

This article evaluates changes in the use of drug services and the corresponding costs when the conventional fee-for-service system for reimbursement of pharmacists under medicaid is replaced by a capitation system. The fee-for-service system usually covers ingredient costs plus a fixed professional dispensing fee. The capitation system provided a cash payment (which varied by aid category and season of the year) per Medicaid eligible the first of each month. We examined drug use and costs in two experimental rural counties during a 1-year preperiod in which the fee-for-service form of reimbursement was employed, as well as a 2-year postperiod in which the capitation system was used. We compared the results with use and cost patients in two other rural counties which remained on the fee-for-service system during the same 3-year period. Drug use was similar among control and experimental counties with the exception of nursing home patients; use in this category decreased under capitation and increased under fee-for-service. Using three measures of drug cost: 1) average cost of a day's drug therapy; 2) average drug costs per recipient; and 3) average Medicaid expenditures for drug services per recipient, we observed significant savings under the capitation reimbursement system as compared to the fee-for-service system. We attributed savings under capitation to shifts in prescribing and dispensing behavior, as well as changes in use by nursing home patients. Based upon these findings, the total savings resulting from implementing capitation would be approximately 16 percent compared to fee-for-service reimbursement.

The effect of Medicaid on the quantity of drugs dispensed per prescription.

Several studies have been conducted in order to determine the effect of the Medicaid program on drug utilization. This paper describes a research project that attempted to determine whether the Medicaid program has any effect on the quantity of drugs dispensed per prescription. A sample of privately paid prescriptions was compared to all Medicaid prescriptions in Iowa during the fiscal year 1972-73. A randomized block design for analysis of variance was used. The results showed that, overall, the quantity prescribed per patient was greater in the Medicaid population than for the privately paying sample. However, when broken down by therapeutic category, 4 of the 15 drug classes examined displayed higher quantities in the privately paying sample. These four categories were classified as maintenance drugs.

Capitation payment for medicaid pharmacy services: impact on non-medicaid prescriptions.

Although pharmacy organizations have been instrumental in the movement to repeal antisubstitution laws, there is evidence that under the current fee-for-service system pharmacists have not exercised their newly obtained prerogatives freely. A previous study has demonstrated that paying pharmacists on a capitation basis for their Medicaid patients effects a highly significant increase in the rate of generic substitution. The present study was conducted to determine whether the pharmacists' newly acquired generic substitution habits "spill over" from Medicaid prescriptions as a result of capitation reimbursement. The results indicate that pharmacists who participated in the capitation experiment for the Medicaid drug program significantly increased their rate of generic substitution on non-Medicaid prescriptions. It was concluded that the same pharmacies that increased their substitution rate in the Medicaid program under capitation also increased their substitution rate on non-Medicaid prescriptions. Finally, generic substitutions in both the Medicaid and non-Medicaid studies generally involved the same labelers as well as drugs in the same therapeutic categories and with the same generic classifications.

Capitation payment for pharmacy services: impact on generic substitution.

This article evaluates changes in the rate of generic substitution as well as the appropriateness of such changes in dispensing behavior when the conventional fee-for-service system for reimbursement of pharmacists is replaced by a capitation system. The fee-for-service system under Medicaid usually covers ingredient costs plus a fixed professional dispensing fee. The capitation system provides a cash payment per Medicaid eligible at the first of each month, which varies by aid category and season of the year. The dispensing behavior of pharmacists in two experimental rural counties is examined during a 1-year preperiod in which the fee-for-service form of reimbursement was employed, as well as a 2-year postperiod in which capitation was used in lieu of fee-for-service payments. The results are compared with pharmacist behavior patterns in two other rural counties which remained on the fee-for-service system over the same 3-year period. The data indicate highly significant increases in both the rate of generic substitution as well as the dollar savings per substitution in the experimental counties after the institution of capitation reimbursement. Using explicit criteria, no substantial differences in the appropriateness of generic substitution were noted between the two financing schemes.

Capitation payment for pharmacy services. I. Impact on drug use and pharmacist dispensing behavior.

Results of a two-county pilot study in Iowa revealed that capitation may have significant advantages over fee-for-service (FFS) reimbursement in the Medicaid drug program. Consequently, the capitation program was expanded to 32 counties on April 1, 1981 and continued through December 31, 1981. Another 32 counties were used as part of a before:after/experimental:control design. Pharmacists were paid 80% of projected drug expenditures in advance based on the types of Medicaid eligibles who chose them as their providers. The remaining 20% was withheld in an escrow account to be used for supplemental, emergency, and bonus payments. Pharmacists who participated in this experiment were guaranteed that their gross profits on Medicaid prescriptions would remain at least equal to what they would have been if they had remained under the current FFS payment system. Major differences in drug use levels and pharmacist dispensing behavior under capitation financing were observed in the pilot study. However, no such changes associated with payment type were noted in the expanded program. Relative to these findings, a discussion of pharmacist attitudes is presented.

Capitation payment for pharmacy services. II. Impact on costs.

Four areas of cost were analyzed in the expanded capitation drug program: total program costs; drug costs, escrow account distribution, and administrative costs. Total program costs were, on average, 9% higher under capitation. Drug costs, however, were 3% lower than under fee-for-service (FFS) reimbursement. This discrepancy is probably because pharmacists were not at financial risk under the program, the capitation rates were higher than intended, there were many emergency claims, and other aspects of the research environment. Although administrative costs were large, almost two thirds of the development cost was for one-time work, which could be transferred to another state at little or no expense. One third of the total administrative costs can be attributed to complying with regulations of the Health Care Financing Administration. Significant refinement of the present capitation model may be necessary before this financing innovation is used elsewhere. Modifications might include limiting the system to nursing home patients, placing pharmacists at partial financial risk, restricting participation to pharmacies that service a large number of Medicaid eligibles, and basing capitation rates in part on the drug use behavior of cash-paying patients.

Effects of capitation payment for pharmacy services on pharmacist-dispensing and physician-prescribing behavior: I. Prescription quantity and dose analysis.

This paper evaluates changes in quantities and appropriateness of dosages and quantities of prescription in capitation and control pharmacies. The data indicate that, under capitation, changes were made in the quantities of ingredients so that the quantities dispensed were significantly different from those prescribed. However, the number of such modifications to prescriptions was small, and the reader is cautioned against drawing broad conclusions. The analysis, then, considers changes in days' supply of prescription ingredients during the study period. There were significantly increases in the average day's supply of prescription ingredients for maintenance drugs dispensed under the capitation reimbursement scheme; however, no such differences were observed for non-maintenance drugs. Appropriateness of the dosages and quantities of prescriptions were then compared for capitation and fee-for-service pharmacies for the study period, and no significant differences were found. Thus, it is concluded that although capitation was associated with increases in the average days' supply of ingredients dispensed for maintenance prescriptions, such changes did not adversely affect the quality of drug therapy as measured by two sets of criteria.