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Charging for health care: Evidence on the utilisation of NHS prescribed drugs


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  • Ryan, Mandy
  • Birch, Stephen
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    The effects of regular and frequent increases in charges for health care on patient utilisation are analysed using monthly data on National Health Service (NHS) prescribed drugs in England for the period 1979-1985. Using a partial adjustment model a utilisation equation of prescribed drugs is estimated for the adult non-elderly population that is subject to the NHS prescription charge. The maximum likelihood estimates of the coefficients of the equation imply that the charges policy followed in the U.K. has led to a significant reduction in utilisation among non-exempt patients. The short-run price elasticity of utilisation is --0.109 and the long-run elasticity is --0.09, while exempt utilisation is unaffected. Although the policy has generated a reduction in the central Government expenditure for prescribed drugs, on the basis of these estimates around 66% of these savings arise from the reduction in service use as opposed to the increased revenue per item of drugs.

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    Bibliographic Info

    Article provided by Elsevier in its journal Social Science & Medicine.

    Volume (Year): 33 (1991)
    Issue (Month): 6 (January)
    Pages: 681-687

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    Handle: RePEc:eee:socmed:v:33:y:1991:i:6:p:681-687

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    Keywords: charges health care utilisation;


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    Cited by:
    1. Fiorio, Carlo V. & Siciliani, Luigi, 2010. "Co-payments and the demand for pharmaceuticals: Evidence from Italy," Economic Modelling, Elsevier, vol. 27(4), pages 835-841, July.
    2. Mielck, Andreas, 1998. "Perception of health inequalities in different social classes, by health professionals and health policy makers in Germany and the United Kingdom," Discussion Papers, Research Group Public Health P98-202, Social Science Research Center Berlin (WZB).
    3. Vincenzo Atella & Karen Hassell & Ellen Schafheutle & Marjorie C. Weiss & Peter R. Noyce, 2003. "Cost to the Patient or Cost to the Healthcare System? Which one Matters the Most for GP Prescribing Decisions? A UK-Italy Comparison," CEIS Research Paper 1, Tor Vergata University, CEIS.
    4. Paul V. Grootendorst & Mitchell Levine, 2002. "Do Drug Plans Matter? Effects of Drug Plan Eligibility on Drug Use Among the Elderly, Social Assistance Recipients and the General Population," Social and Economic Dimensions of an Aging Population Research Papers 73, McMaster University.


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