Does drug price-regulation affect healthcare expenditures?
BACKGROUND
Increasing health costs in developed countries are a major concern for decision makers. A variety of cost containment tools are used to control this trend, including maximum price regulation and reimbursement methods for health technologies. Information regarding expenditure-related outcomes of these tools is not available.


OBJECTIVE
To evaluate the association between different cost-regulating mechanisms and national health expenditures in selected countries.


METHODS
Price-regulating and reimbursement mechanisms for prescription drugs among OECD countries were reviewed. National health expenditure indices for 2008-2012 were extracted from OECD statistical sources. Possible associations between characteristics of different systems for regulation of drug prices and reimbursement and health expenditures were examined.


RESULTS
In most countries, reimbursement mechanisms are part of publicly financed plans. Maximum price regulation is composed of reference-pricing, either of the same drug in other countries, or of therapeutic alternatives within the country, as well as value-based pricing (VBP). No association was found between price regulation or reimbursement mechanisms and healthcare costs. However, VBP may present a more effective mechanism, leading to reduced costs in the long term.


CONCLUSIONS
Maximum price and reimbursement mechanism regulations were not found to be associated with cost containment of national health expenditures. VBP may have the potential to do so over the long term.
Department of Management, Public Health and Health System Management Program, Bar Ilan University, 52900, Ramat Gan, Israel. NoaAndOmer@gmail.com.
Omer
O
Ben-Aharon
Department of Management, Public Health and Health System Management Program, Bar Ilan University, 52900, Ramat Gan, Israel.
Oren
O
Shavit
Department of Management, Public Health and Health System Management Program, Bar Ilan University, 52900, Ramat Gan, Israel.
Racheli
R
Magnezi
D003363:Cost Control / Q000706:statistics & numerical data*; D003365:Costs and Cost Analysis / Q000331:legislation & jurisprudence*; D019049:Developed Countries; D016527:Drug Costs / Q000331:legislation & jurisprudence*; D005102:Health Expenditures / Q000706:statistics & numerical data*; D006801:Humans; D007349:Insurance, Health, Reimbursement / Q000706:statistics & numerical data*; D017059:Models, Econometric
Drug price; Drug reimbursement; Healthcare expenditure; Price regulation; Value-based pricing
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