Cost Sharing and the Initiation of Drug Therapy for the Chronically Ill

Published In: Archives of Internal Medicine, v. 169, no. 8, Apr. 27, 2009, p. 740-748

Posted on RAND.org on April 27, 2009

by Matthew D. Solomon, Dana P. Goldman, Geoffrey F. Joyce, Jose J. Escarce

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BACKGROUND: Increased cost sharing reduces utilization of prescription drugs, but little evidence demonstrates how this reduction occurs or the factors associated with price sensitivity. METHODS: The authors conducted a retrospective cohort study of older adults with employer-provided drug coverage from 1997 to 2002 from 31 different health plans. The authors measured the time until initiation of medical therapy for 17 183 patients with newly diagnosed hypertension, diabetes, or hypercholesterolemia. RESULTS: For all study conditions, higher copayments were associated with delayed initiation of therapy. In survival models, doubling copayments resulted in large reductions in the predicted proportion of patients initiating pharmacotherapy at 1 and 5 years after diagnosis: for hypertension, 54.8% vs 39.9% at 1 year and 81.6% vs 66.2% at 5 years (P < .001); for hypercholesterolemia, 40.2% vs 31.1% at 1 year and 64.3% vs 53.8% at 5 years (P < .002); and for diabetes, 45.8% vs 40.0% at 1 year and 69.3% vs 62.9% at 5 years (P < .04). However, patients' rate of initiation and sensitivity to copayments strongly depended on their prior experience with prescription drugs. Those without prior drug use (26.1%, 10.4%, and 12.9%) initiated later (833, >1170, and >1402 days later in median time until initiation) and were far more price sensitive (increase of 34.5%, 20.1%, and 27.2% remaining untreated after 5 years when copayments doubled) than those with a history of drug use among patients with newly diagnosed hypertension, hypercholesterolemia, and diabetes, respectively. These results were robust to a wide range of sensitivity analyses. CONCLUSIONS: High cost sharing delays the initiation of drug therapy for patients newly diagnosed with chronic disease. This effect is greater among patients who lack experience with prescription drugs. Policy makers and physicians should consider the effects of benefits design on patient behavior to encourage the adoption of necessary care.

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