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Co-payments and the demand for pharmaceuticals: Evidence from Italy

  • Fiorio, Carlo V.
  • Siciliani, Luigi

This study exploits a natural experiment in Italy to estimate how the demand for pharmaceuticals responds to variations in co-payment levels. After a period where co-payments were set to zero by a national law, the decision over co-payments was devolved to the Italian regions. While some regions re-introduced the co-payment, others did not. Using a difference-in-difference approach on regional monthly data for years 2001 and 2003, we find that an increase in the co-payment by one Euro reduces the per capita number of prescriptions by 4% and per capita public pharmaceutical expenditure by 3.4%. We also find evidence that when in 2006 some regions reduced (but not removed) the co-payment, a reduction in the co-payment by one Euro increased the per capita number of prescriptions by 3.4%, and per capita public pharmaceutical expenditure by 4.9%.

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Article provided by Elsevier in its journal Economic Modelling.

Volume (Year): 27 (2010)
Issue (Month): 4 (July)
Pages: 835-841

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Handle: RePEc:eee:ecmode:v:27:y:2010:i:4:p:835-841
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