Effects of prescription coinsurance and income-based deductibles on net health plan spending for older users of inhaled medications

Abstract

Background: Health plans that increase prescription cost-sharing for their patients may increase overall plan costs. We analyzed the impact on health plan spending of a switch in public drug insurance from full coverage to a prescription copayment (copay), and then to income-based deductibles plus coinsurance (IBD).

Methods: We studied British Columbia residents 65 years of age or older who were dispensed inhaled steroids, beta2 agonists or anticholinergics on or after January 1996. Multivariable linear regression was used to estimate health plan costs for the population using inhalers by the Ministry of Health (MOH) during the copay and IBD policies. We estimated costs for excess physician visits and emergency hospitalizations based on data from a previously published cohort study and cost data from the MOH. We estimated the net change in MOH spending as the sum of changes in spending for inhalers, physician visits, hospitalizations, and policy administration costs.

Results: Net health plan spending increased by C$1.98 million per year during the copay policy [95% confidence interval (CI): 0.10-4.34], and C$5.76 million per year during the first 10 months of the IBD policy (95% CI: 1.75-10.58). Out-of-pocket spending by older patients increased 30% during the copay policy (95% CI: 24-36) and 59% during the IBD policy (95% CI: 56-63).

Conclusions: British Columbia's experience indicates that cost containment focused on cost-shifting to patients may increase net expenditures for the treatment of some diseases. Health plans should consult experts to anticipate the potential cross-program impacts of policy changes.

FIGURE 1

Trend in MOH expenditure on inhalers (steroids + β2 agonists + anticholinergics) before and after the copay and IBD policies, for patients 65 years of age and older (2003 Canadian dollars).