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Patient Outcomes and Cost Effects of Medicaid Formulary Restrictions on Antidepressants

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  • Seabury Seth A.

    (Associate Professor of Research, Department of Emergency Medicine and the Leonard D. Schaeffer Center for Health Policy and Economics, University of Southern California, USC Schaeffer Center, 635 Downey Way, VPD Suite 210, Los Angeles, CA 90089-3333, USA)

  • Lakdawalla Darius N.

    (University of Southern California, Los Angeles, CA, USA)

  • Walter Deborah

    (Takeda Pharmaceuticals America, Inc., Washington, DC, USA)

  • Hayes John

    (National Network of Depression Centers, Ann Arbor, MI, USA)

  • Gustafson Thomas

    (Arnold and Porter, LLP, Washington, DC, USA)

  • Shrestha Anshu

    (Precision Health Economics, Los Angeles, CA, USA)

  • Goldman Dana P.

    (University of Southern California, Los Angeles, CA, USA)

Abstract

Many state Medicaid programs have implemented policies designed to reduce spending on prescription drugs by restricting access to branded products. For patients with major depressive disorder, formulary restrictions could severely limit access to antidepressant therapies and disrupt care. We linked data on patient outcomes and spending from 24 state Medicaid programs to information on formulary restrictions from 2001 to 2008. Outcomes included frequency of MDD-related hospitalizations and ER visits per patient and total healthcare spending. We estimated the effect of the policies on patient outcomes and spending using a difference-and-difference approach. We found that restricting access to antidepressants increased the probability of an MDD-related hospitalization by 1.7 percentage points (16.6%). Furthermore, we found no evidence that these restrictions resulted in any net savings for Medicaid.

Suggested Citation

  • Seabury Seth A. & Lakdawalla Darius N. & Walter Deborah & Hayes John & Gustafson Thomas & Shrestha Anshu & Goldman Dana P., 2014. "Patient Outcomes and Cost Effects of Medicaid Formulary Restrictions on Antidepressants," Forum for Health Economics & Policy, De Gruyter, vol. 17(2), pages 153-168, September.
    • Handle: RePEc:bpj:fhecpo:v:17:y:2014:i:2:p:16:n:4
    DOI: 10.1515/fhep-2014-0016
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    References listed on IDEAS

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    1. Angrist, Joshua D. & Krueger, Alan B., 1999. "Empirical strategies in labor economics," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 23, pages 1277-1366, Elsevier.
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    Cited by:

    1. Dillender, Marcus, 2018. "What happens when the insurer can say no? Assessing prior authorization as a tool to prevent high-risk prescriptions and to lower costs," Journal of Public Economics, Elsevier, vol. 165(C), pages 170-200.

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