High Co-Payments Save Employers Money

High Co-Payments Save Employers Money

Jun 20, 2007 6:00 PM

Changes in benefits led some employees to switch, stop taking medications

SALT LAKE CITY - Shifting the cost of prescription drugs, in the form of higher co-payments for health-plan members, saved employers up to $305 a year per worker without affecting short-term total health-care costs for any of five diseases, new research from the University of Utah Pharmacotherapy Outcomes Research Center and Intermountain Healthcare shows.

The study, published in the June issue of The American Journal of Managed Care , found, depending on which disease they had, some workers continued with their same medication, while others changed to less expensive ones, and others stopped taking them altogether when their co-payments increased.

Researchers at the University's Pharmacy Outcomes Research Center, part of the College of Pharmacy, tracked the effect of higher prescription co-payments on the costs of employer-sponsored health plans and total health-care costs from January 2001 through December 2002. The study followed employees taking medication for osteoarthritis, asthma, allergic rhinitis, high blood pressure, and diabetes.

The researchers studied companies and workers whose health insurance is provided through SelectHealth, a subsidiary of Intermountain Healthcare in Salt Lake City. Changes in the benefit designs were made at the employers' request.

Lead author Diana I. Brixner, Ph.D., R.Ph., chair of the Department of Pharmacotherapy at the University's College of Pharmacy, called the study's findings mixed. "Co-payment increases can appropriately decrease costs for a health-care system without showing negative effects on costs in other areas," she said. "But discontinuing their medication may affect individual patients."

Brixner cautioned the study looked at medical outcomes for only a year following the co-payment increases, so longer-term effects on the overall costs weren't studied. The effect of the higher co-payments was compared with workers in a control group whose prescription costs did not increase.

Those with diabetes, a disease that needs constant monitoring and can be subject to sudden changes, were least likely to switch or discontinue medications. Nearly 54 percent of these diabetes patients continued with their current prescriptions, while 22 percent switched to cheaper ones, and 20 percent stopped taking medication altogether. The percentage of employees who stopped their medication did not differ from that of the control group.

Patients with osteoarthritis, allergic rhinitis, and asthma were more likely to discontinue their prescriptions, with more than 60 percent stopping their drug therapy when the co-payment went up. But 50 percent of patients in the control group stopped their medication as well, indicating the discontinuation rate among patients for these three diseases is higher regardless of the co-payment. Only 5 percent to 10 percent of patients whose co-payments increased switched to cheaper drugs, while 25 percent to 30 percent stayed on the same medication. Patients' decisions may have been affected by the acute or seasonal nature of these diseases and the availability of over-the-counter medications for osteoarthritis pain and allergic rhinitis, Brixner said.

The group with high blood pressure was more evenly distributed between continuing with the same prescriptions (43 percent) and stopping medication altogether (39 percent).

The yearlong prescription cost savings for employers ranged from $92 for each employee with diabetes, $95 for those with allergic rhinitis, $180 for high blood pressure, $269 for asthma, and $305 for workers taking drugs for osteoarthritis.

Co-authors on the study include Gary M. Oderda, Pharm.D., MPH, professor of pharmacotherapy; and H. Eric Cannon, Pharm.D., SelectHealth, and adjunct instructor of pharmacotherapy in the College of Pharmacy; Vijay N. Joish, Ph.D., of Sanofi Aventis, Bridgewater, N.J., and Steven G. Avery, R.Ph., of PartnersRX, Scottsdale, Ariz.

The study was funded in part by the Foundation of Managed Care Pharmacy.

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