Unbiased Analysis of Today's Healthcare Issues
Copay cards are somewhat controversial. These cards or coupons are used to help patients afford copayments and deductible payments patients owe when using pharmaceuticals. On the one hand, these programs are highly beneficial for patients. Patient out-of-pocket costs have risen dramatically in recent years, even among the insured. For instance, whereas only 7% of workers…
ASPE has a report out on the potential impact of the Inflation Reduction Act on Medicare Part D beneficiary out-of-pocket spending. This is a particularly relevant topic as the share of patients who have fallen into the catastrophic coverage has increased over time. Some of the medical conditions with the top out-of-pocket payments for Medicare…
This is the paraphrased title of a paper by Fusco et al. (2023). The authors conduct a systematic literature review of studies published between 2010 and 2020 and find that among the 79 articles screened: The majority of publications found that, regardless of disease area, increased cost-sharing was associated with worse adherence, persistence, or discontinuation.…
In the past, seniors in Medicare had to pay for all their prescription drugs out-of-pocket. For elderly individuals with multiple medical conditions, this lack of coverage was highly burdensome. To address this issue, in 2006, Medicare Part D began which provided some coverage for prescription drugs. To keep the cost of Part D down, however,…
This is a few years old, but still very relevant. It’s from a speech by former FDA Commissioner Scott Gottlieb on March 7, 2018 titled “Capturing the Benefits of Competition for Patients“ Patients shouldn’t be penalized by their biology if they need a drug that isn’t on formulary. Patients shouldn’t face exorbitant out of pocket…
Cost sharing is just that, sharing in the cost of providing a health care service. While health insurers often pay for a large share of health care cost (for those covered), individuals also contribute through deductibles, copayments and coinsurance. The goal of cost sharing is to reduce moral hazard. Moral hazard occurs when the price…
Not a surprising finding but an important one nonetheless. Using data from the 2013–17 National Health Interview Survey (NHIS) a paper by Gaffney et al. (2020) finds: Although people with VHA [Veterans Health Administration] coverage were older and in worse health and had lower incomes than those with other coverage, VHA patients had lower rates…
Treatments for the hepatitis C virus (HCV) are expensive. At one point they cost over $80,000 per year, although costs have decreased since then. To prevent moral hazard, should insurance companies rely on cost sharing to decrease utilization? An article by Lakdawalla, Linthicum, and Vanderpuye-Orgle (2016) argues that they shouldn’t. Cost sharing appears even less efficient when…
Any economist knows that if you raise the price of a good, demand goes down. Thus, one should not be surprised to find numerous studies that show that increased cost sharing decreases drug utilization. But how does drug utilzation decrease? Is it along the extensive margin (i.e., the decision to initiate the drug) or along the intensive margin…
Is the Affordable Care Act making health insurance more affordable? Generally, the answer is yes. More individuals are insured due to Medicaid coverage expansions in some but not all states and the implementation of health insurance exchanges. However, there is one worrying trend in affordability: increasing patient cost sharing. A paper by Hempstead et al. (2015),…