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Pharmacy Benefits and the Use of Drugs by the Chronically Ill
ORIGINAL CONTRIBUTION
Pharmacy Benefits and the Use
of Drugs by the Chronically Ill
Dana P. Goldman, PhD
Geoffrey F. Joyce, PhD
Jose J. Escarce, MD, PhD
Jennifer E. Pace, BS
Matthew D. Solomon, MA
Marianne Laouri, PhD
Pamela B. Landsman, MPH, DrPH
Steven M. Teutsch, MD, MPH
IN RECENT YEARS, MANY HEALTHplans have implemented policies tocontain drugs costs, including rais-ing beneficiary co-payments, man-
dating use of generics, requiring mail-
order services, and expanding use of
formularies, all of which have large ef-
fects on total drug spending. For ex-
ample, doubling co-payments re-
duced total drug spending by 19% to
33% in one multiyear study of 25 com-
panies.1 Such large responses often raise
concerns about adverse health conse-
quences, particularly for chronically ill
individuals. Indeed, large changes in
drug benefits are sometimes associ-
ated with substantial morbidity and
mortality in certain high-risk popula-
tions.2-4
In the privately insured nonelderly
population, the patterns may differ. Al-
though there is also evidence that this
population changes its patterns of drug
use when benefits change, there is less
evidence of adverse health conse-
quences. One plausible explanation is
that the health consequences manifest
over many years, and relevant longitu-
dinal databases are scarce. In addi-
tion, there may be different responses,
depending on the diseases the drugs
treat. Several studies suggest that con-
sumer sensitivity to cost sharing de-
pends on a drug’s therapeutic class4-7
and that increased cost sharing may de-
crease “nonessential” drug use more
than “essential” drug use.8,9 This makes
identifying the therapeutic classes most
sensitive to benefit changes critically
important.
We examined how changes in ben-
efit design among privately insured
populations affect use of the most com-
monly used drug classes. In addition,
we identified populations more likely
to be at risk for adverse health effects
and isolated their responsiveness to cos
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