Prescription drug copays and deductibles may increase treatment costs for some diseases
Research Activities, October 2009
It is now commonplace for patients to share the cost of prescription drugs with their health insurance plans. Such cost sharing is designed as a financial incentive for patients to use less expensive therapies. However, a new study finds that such prescription copays may actually increase net health plan spending in some instances.
Researchers looked at 75,628 elderly residents living in British Columbia, Canada, who had received inhaler medications for asthma or other conditions. These individuals had full coverage for prescription drugs until the end of 2001. After that, they had a fixed copay of $25 per prescription for seniors. Later, an income-based deductible plus coinsurance plan was implemented. The researchers estimated overall health care costs, costs for excess physician visits, and costs for emergency hospitalizations.
Net health plan spending increased by $1.98 million (Canadian dollars) per year during the use of the copay policy. It then increased to $5.76 million per year during the first 10 months after the income-based deductible plus coinsurance plan was in place. Older patients had their out-of-pocket spending increase 30 percent during the copay policy. In contrast, spending increased by 59 percent after the income-based program was implemented. The authors conclude that such forms of cost sharing do not lower health plan spending related to full treatment coverage for some diseases. The study was supported in part by the Agency for Healthcare Research and Quality (HS10881).
See "Effects of prescription coinsurance and income-based deductibles on net health plan spending for older users of inhaled medications," by Colin R. Dormuth, Sc.D., Peter Neumann, Sc.D., Malcolm Maclure, Sc.D., and others, in the May 2009 Medical Care 47(5), pp. 508-516.