Can income-based co-payment rates improve disparity? the case of the choice between brand-name and generic drugs

Yuki Ito, Konan Hara, Byung Kwang Yoo, Jun Tomio, Yasuki Kobayashi

Research output: Contribution to journalArticle

Abstract

Background: Higher income population tend to prefer brand-name to generic drugs, which may cause disparity in access to brand-name drugs among income groups. A potential policy that can resolve such disparity is imposing a greater co-payment rate on high-income enrollees. However, the effects of such policy are unknown. We examined how patients' choice between brand-name and generic drugs are affected by the unique income-based co-payment rates in Japan; 10% for general enrollees and 30% for those with high income among the elderly aged 75 and over. Methods: We drew on cross-sectional price variation among commonly prescribed 311 drugs using health insurance claims data from a large prefecture in Japan between October 2013 and September 2014 to identify between-income-group differences in responses to differentiated payments. Results: Running 311 multivariate logistic regression models controlling individual demographics, the median estimate indicated that high-income group was 3% (odds ratio = 0.97) less likely to choose a generic drug than the general-income group and the interquartile estimates ranged 0.92-1.02. The multivariate feasible generalized least squares model indicated high-income group's higher likelihood to choose brand-name drugs than the general-income group without co-payment rate differentiation (p < 0.001). Such gap in the likelihood was attenuated by 0.4% (p = 0.027) with an USincrease in the difference in additional payment/month for brand-name drugs between income groups - no gap with US$10 additional payment/month. This attenuation was observed in drugs for chronic diseases only, not for acute diseases. Conclusions: Income-based co-payment rates appeared to reduce disparity in access to brand-name drugs across income groups, in addition to reducing total medical expenditure among high-income group who shifted from brand-name drugs to generic ones due to larger drug price differences.

Original languageEnglish (US)
Article number780
JournalBMC Health Services Research
Volume19
Issue number1
DOIs
StatePublished - Jan 1 2019

Fingerprint

Generic Drugs
Names
Pharmaceutical Preparations
Japan
Logistic Models
Acute Disease
Health Insurance
Health Expenditures
Least-Squares Analysis

Keywords

  • Co-payment rate
  • Disparity
  • Generic drugs
  • Pharmaceuticals

ASJC Scopus subject areas

  • Health Policy

Cite this

Can income-based co-payment rates improve disparity? the case of the choice between brand-name and generic drugs. / Ito, Yuki; Hara, Konan; Yoo, Byung Kwang; Tomio, Jun; Kobayashi, Yasuki.

In: BMC Health Services Research, Vol. 19, No. 1, 780, 01.01.2019.

Research output: Contribution to journalArticle

@article{0d81afbd5f114be2835b7e44663917d5,
title = "Can income-based co-payment rates improve disparity? the case of the choice between brand-name and generic drugs",
abstract = "Background: Higher income population tend to prefer brand-name to generic drugs, which may cause disparity in access to brand-name drugs among income groups. A potential policy that can resolve such disparity is imposing a greater co-payment rate on high-income enrollees. However, the effects of such policy are unknown. We examined how patients' choice between brand-name and generic drugs are affected by the unique income-based co-payment rates in Japan; 10{\%} for general enrollees and 30{\%} for those with high income among the elderly aged 75 and over. Methods: We drew on cross-sectional price variation among commonly prescribed 311 drugs using health insurance claims data from a large prefecture in Japan between October 2013 and September 2014 to identify between-income-group differences in responses to differentiated payments. Results: Running 311 multivariate logistic regression models controlling individual demographics, the median estimate indicated that high-income group was 3{\%} (odds ratio = 0.97) less likely to choose a generic drug than the general-income group and the interquartile estimates ranged 0.92-1.02. The multivariate feasible generalized least squares model indicated high-income group's higher likelihood to choose brand-name drugs than the general-income group without co-payment rate differentiation (p < 0.001). Such gap in the likelihood was attenuated by 0.4{\%} (p = 0.027) with an USincrease in the difference in additional payment/month for brand-name drugs between income groups - no gap with US$10 additional payment/month. This attenuation was observed in drugs for chronic diseases only, not for acute diseases. Conclusions: Income-based co-payment rates appeared to reduce disparity in access to brand-name drugs across income groups, in addition to reducing total medical expenditure among high-income group who shifted from brand-name drugs to generic ones due to larger drug price differences.",
keywords = "Co-payment rate, Disparity, Generic drugs, Pharmaceuticals",
author = "Yuki Ito and Konan Hara and Yoo, {Byung Kwang} and Jun Tomio and Yasuki Kobayashi",
year = "2019",
month = "1",
day = "1",
doi = "10.1186/s12913-019-4598-8",
language = "English (US)",
volume = "19",
journal = "BMC Health Services Research",
issn = "1472-6963",
publisher = "BioMed Central",
number = "1",

}

TY - JOUR

T1 - Can income-based co-payment rates improve disparity? the case of the choice between brand-name and generic drugs

AU - Ito, Yuki

AU - Hara, Konan

AU - Yoo, Byung Kwang

AU - Tomio, Jun

AU - Kobayashi, Yasuki

PY - 2019/1/1

Y1 - 2019/1/1

N2 - Background: Higher income population tend to prefer brand-name to generic drugs, which may cause disparity in access to brand-name drugs among income groups. A potential policy that can resolve such disparity is imposing a greater co-payment rate on high-income enrollees. However, the effects of such policy are unknown. We examined how patients' choice between brand-name and generic drugs are affected by the unique income-based co-payment rates in Japan; 10% for general enrollees and 30% for those with high income among the elderly aged 75 and over. Methods: We drew on cross-sectional price variation among commonly prescribed 311 drugs using health insurance claims data from a large prefecture in Japan between October 2013 and September 2014 to identify between-income-group differences in responses to differentiated payments. Results: Running 311 multivariate logistic regression models controlling individual demographics, the median estimate indicated that high-income group was 3% (odds ratio = 0.97) less likely to choose a generic drug than the general-income group and the interquartile estimates ranged 0.92-1.02. The multivariate feasible generalized least squares model indicated high-income group's higher likelihood to choose brand-name drugs than the general-income group without co-payment rate differentiation (p < 0.001). Such gap in the likelihood was attenuated by 0.4% (p = 0.027) with an USincrease in the difference in additional payment/month for brand-name drugs between income groups - no gap with US$10 additional payment/month. This attenuation was observed in drugs for chronic diseases only, not for acute diseases. Conclusions: Income-based co-payment rates appeared to reduce disparity in access to brand-name drugs across income groups, in addition to reducing total medical expenditure among high-income group who shifted from brand-name drugs to generic ones due to larger drug price differences.

AB - Background: Higher income population tend to prefer brand-name to generic drugs, which may cause disparity in access to brand-name drugs among income groups. A potential policy that can resolve such disparity is imposing a greater co-payment rate on high-income enrollees. However, the effects of such policy are unknown. We examined how patients' choice between brand-name and generic drugs are affected by the unique income-based co-payment rates in Japan; 10% for general enrollees and 30% for those with high income among the elderly aged 75 and over. Methods: We drew on cross-sectional price variation among commonly prescribed 311 drugs using health insurance claims data from a large prefecture in Japan between October 2013 and September 2014 to identify between-income-group differences in responses to differentiated payments. Results: Running 311 multivariate logistic regression models controlling individual demographics, the median estimate indicated that high-income group was 3% (odds ratio = 0.97) less likely to choose a generic drug than the general-income group and the interquartile estimates ranged 0.92-1.02. The multivariate feasible generalized least squares model indicated high-income group's higher likelihood to choose brand-name drugs than the general-income group without co-payment rate differentiation (p < 0.001). Such gap in the likelihood was attenuated by 0.4% (p = 0.027) with an USincrease in the difference in additional payment/month for brand-name drugs between income groups - no gap with US$10 additional payment/month. This attenuation was observed in drugs for chronic diseases only, not for acute diseases. Conclusions: Income-based co-payment rates appeared to reduce disparity in access to brand-name drugs across income groups, in addition to reducing total medical expenditure among high-income group who shifted from brand-name drugs to generic ones due to larger drug price differences.

KW - Co-payment rate

KW - Disparity

KW - Generic drugs

KW - Pharmaceuticals

UR - http://www.scopus.com/inward/record.url?scp=85074353184&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=85074353184&partnerID=8YFLogxK

U2 - 10.1186/s12913-019-4598-8

DO - 10.1186/s12913-019-4598-8

M3 - Article

C2 - 31675967

AN - SCOPUS:85074353184

VL - 19

JO - BMC Health Services Research

JF - BMC Health Services Research

SN - 1472-6963

IS - 1

M1 - 780

ER -