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Demand Side Cost-Sharing and Prescription Drugs Utilization: Evidence From a Quasi-Natural Experiment

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  • Eva Hromadkova
  • Michal Zdenek

Abstract

In this paper we investigate the effects of introduction of lump sum copayments on the utilization of prescription drugs by elderly patients. We make use of an unique dataset and analyze the policy change that implemented patient cost-sharing in the Czech Republic starting in 2008. After the introduction of copayments the number of prescriptions filled decreased by 29%. At the same time, however, total expenditures on prescription drugs dropped only in the first quarter of the postintroduction period and then returned to previous levels. This was partially due to behavioral responses of patients and physicians: strategic shift of prescription purchases to the time right before the introduction of reform, prescription of more packages on one prescription and an upward shift in the price composition of prescribed drugs. Moreover, patients in general decided to forego those types of drugs that did not cause immediate worsening of health status.

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Bibliographic Info

Paper provided by The Center for Economic Research and Graduate Education - Economic Institute, Prague in its series CERGE-EI Working Papers with number wp486.

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Date of creation: Apr 2013
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Handle: RePEc:cer:papers:wp486

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Related research

Keywords: health insurance; moral hazard; cost sharing; prescription drugs;

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References

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  1. Chandra, Amitabh & Gruber, Jonathan & McKnight, Robin, 2009. "Patient Cost-Sharing and Hospitalization Offsets in the Elderly," Scholarly Articles, Harvard Kennedy School of Government 8058412, Harvard Kennedy School of Government.
  2. Manning, Willard G, et al, 1987. "Health Insurance and the Demand for Medical Care: Evidence from a Randomized Experiment," American Economic Review, American Economic Association, American Economic Association, vol. 77(3), pages 251-77, June.
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Cited by:
  1. Martin Guzi & Monika Martišková & Michal Paleník & Filip Pertold & Zuzana Siebertová, 2013. "GINI Country Report: The Czech Republic and Slovakia," Research Reports, Central European Labour Studies Institute (CELSI) 7, Central European Labour Studies Institute (CELSI).
  2. Martin Kahanec & M. Guzi & M. Martišková & M. Paleník & F. Pertold & Z. Siebertová, 2012. "GINI Country Report: Growing Inequalities and their Impacts in the Czech Republic and Slovakia," GINI Country Reports, AIAS, Amsterdam Institute for Advanced Labour Studies czech_slovak, AIAS, Amsterdam Institute for Advanced Labour Studies.

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