title: The impact of physician-level drug budgets on prescribing behavior.
abstract: To contain pharmaceutical spending, drug budgets have been introduced across health systems. Apart from analyzing whether drug budgets fulfill their overall goal of reducing spending, changes in the cost and quality of prescribing and the enforcement mechanisms put in place need evaluation to assess the effectiveness of drug budgets at the physician level. In this study, we aim to analyze the cost and quality of prescribing conditional on the level of utilization of the drug budget and in view of varying levels of enforcement in cases of overspending. We observed drug budget utilization in a panel of 440 physicians in three federal states of Germany from 2005 to 2011. At the physician level, we retrospectively calculated drug budgets, the level of drug budget utilization, and differentiated by varying levels of enforcement where physicians overspent their budgets (i.e., more than 115/125% of the drug budget). Using lagged dependent-variable regression models, we analyzed whether the level of drug budget utilization in the previous year affected current prescribing in terms of various indicators to describe the cost and quality of prescribing. We controlled for patient and physician characteristics. The mean drug budget utilization is 92.3%. The level of drug budget utilization influences selected dimensions of cost and quality of prescribing (i.e., generic share (estimate 0.000215; p = 0.0246), concentration of generic brands (estimate 0.000585; p = 0.0056) and therapeutic substances (estimate -0.000060; p < 0.0001) and the share of potentially inappropriate medicines in the elderly (estimate 0.001; p < 0.0001)), whereas the level of enforcement does not. Physicians seem to gradually adjust their prescription patterns, especially in terms of generic substitution.
authors.affiliation: CINCH Health Economics Research Center, University of Duisburg-Essen, Campus Essen, Thea-Leymann-Str. 9, 45127, Essen, Germany. katharina.fischer@uni-due.de.|Hamburg Center for Health Economics, University of Hamburg, Hamburg, Germany. katharina.fischer@uni-due.de.
authors.forename: Katharina Elisabeth
authors.initials: KE
authors.lastname: Fischer
authors.affiliation: Hamburg Center for Health Economics, University of Hamburg, Hamburg, Germany.
authors.forename: Taika
authors.initials: T
authors.lastname: Koch
authors.affiliation: IMS Health, Epidemiology, Frankfurt Am Main, Germany.
authors.forename: Karel
authors.initials: K
authors.lastname: Kostev
authors.affiliation: Hamburg Center for Health Economics, University of Hamburg, Hamburg, Germany.
authors.forename: Tom
authors.initials: T
authors.lastname: Stargardt
mesh_terms: D000293:Adolescent; D000328:Adult; D000368:Aged; D000369:Aged, 80 and over; D002017:Budgets; D002648:Child; D016527:Drug Costs; D011307:Drug Prescriptions; D004363:Drug Utilization; D016568:Drugs, Generic / Q000191:economics*; D005260:Female; D005858:Germany; D006801:Humans; D008297:Male; D008875:Middle Aged; D010820:Physicians; D010818:Practice Patterns, Physicians'; D055815:Young Adult
chemical_list: D016568:Drugs, Generic
keywords: Cost of prescribing; Market regulation; Pharmaceuticals; Physicians