The National Bureau of Economic Research (NBER) published a study this year demonstrating how even small increases in cost cause patients to reduce their use of drugs with major benefits, ultimately causing their death. Other recent studies show that drug prices are rising at nearly double the inflation rate, and drug prices are rising faster than nearly any other household expenses. U.S. drug prices are expected to rise again in July.
Doctors, Amitabh Chandra, Evan Flack, and Ziad Obermeyer, funded by a grant from the National Institute on Aging, used the design of Medicare’s prescription drug benefit program to demonstrate three facts about the health consequences of cost-sharing. The researchers used data on prescription drug cost-sharing and utilization among Medicare Part D beneficiaries who enroll in the year they turn 65 to estimate the impact of cost-sharing on mortality.
The authors estimate that a mere $10.40 increase in coinsurance led to a 32.7 percent increase in monthly mortality (measured in December).
A large share of this increase in mortality was explained by lower fills of inhalers and prescriptions that lower cholesterol, blood sugar, and blood pressure, which are typically classified as “high-value,” life-saving, drugs. Moreover, the authors used machine-learning tools to predict patients’ risk for health events like heart attacks or strokes, and found that the top one-third of patients at risk of a heart attack were over 280 percent more likely to stop filling cardiovascular prescriptions than the bottom two-thirds were.
More people chose to fill no prescriptions when faced with higher out-of-pocket costs, including 18 percent of enrollees overall (regardless of how many drugs they were on initially) and 72.6 percent of enrollees who were on four or more drugs at baseline.
Why This Matters:
The rationale behind higher cost-sharing is to discourage individuals from over-consuming health care items and services including unnecessary, low-value care. However, consistent with a wide body of research, this analysis finds that enrollees who cut back on care in response to higher out-of-pocket costs also reduce use of needed, high value care like prescription drugs (and increase the likelihood of death). Increases in cost-sharing or coinsurance rates forces patients to perform complex cost-benefit analyses that can have deadly consequences if, as these results suggest, patients stop filling life-saving prescriptions.
Dually-eligible Medicare-Medicaid enrollees are deemed eligible for the Medicare Part D Low-Income Subsidy (LIS) program, which provides Part D premium and cost-sharing assistance. LIS enrollees only had to pay nominal co-payments, even within the coverage gap when it was in effect.
The doctors concluded, “that small increases in cost cause patients to cut back on drugs with large benefits, ultimately causing their death. Cutbacks are widespread, but most striking are those seen in patients with the greatest treatable health risks, in whom they are likely to be particularly destructive.”
“Access to affordable prescription drugs has been a solvable problem for decades, as the same drugs are available from licensed online pharmacies in neighboring Canada. No American should be forced to forgo their medication due to cost at their own peril. Clear congressional action to expand support for personal prescription importation is long overdue,” says Jack Pfeiffer, executive director of the Campaign for Personal Prescription Importation.