Why Does the Utilization of Pharmaceuticals Vary So Much Across Europe? Evidence from Micro Data on Older Europeans
AbstractWe analyze the relative importance of population versus institutional factors in explaining cross-country variation in the utilization of pharmaceuticals among older Europeans. Use of medication is examined among all individuals aged 50+ in eleven European countries and, to better control for need, among those diagnosed with medical conditions for which there exist effective drug therapies. Organizational factors include the density of pharmacies and of physicians, retail prices, reimbursement rates, restrictions on retailing of pharmaceuticals and incentives designed to influence prescribing behaviour. Differences in population health and demographics account for almost 75% of the cross-country variation in the propensity to use pharmaceuticals among all older Europeans but this fraction falls to only 12% among those with a diagnosed condition, while, for this group, differences in the organization of the pharmaceutical and health sectors explain 32-54% of the cross-European variation in utilization of medicines. Organizational differences are more important in explaining variation in receipt of medication for serious conditions, such as asthma, arthritis, diabetes, heart attack and stroke, for which 60-80% of the crosscountry variation can be explained by population and organizational factors, and less important for asymptomatic conditions, such as high cholesterol and hypertension, for which less than 35% of the variation is explained.
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Bibliographic InfoPaper provided by HEDG, c/o Department of Economics, University of York in its series Health, Econometrics and Data Group (HEDG) Working Papers with number 09/06.
Date of creation: Apr 2009
Date of revision:
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Pharmaceuticals; heath care; elderly; Europe;
Find related papers by JEL classification:
- I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
This paper has been announced in the following NEP Reports:
- NEP-AGE-2009-04-25 (Economics of Ageing)
- NEP-ALL-2009-04-25 (All new papers)
- NEP-EEC-2009-04-25 (European Economics)
- NEP-HEA-2009-04-25 (Health Economics)
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