An Explanatory Model for State Medicaid per Capita Prescription Drug Expenditures

Abstract

Rising prescription drug expenditure is a growing concern for publicly funded drug benefit programs like Medicaid. To be able to contain drug expenditures in Medicaid, it is important that cause(s) for such increases are identified. This study attempts to establish an explanatory model for Medicaid prescription drugs expenditure based on the impacts of key influencers/predictors identified using a comprehensive framework of drug utilization. A modified Andersen's behavior model of health services utilization is employed to identify potential determinants of pharmaceutical expenditures in state Medicaid programs. Level of federal matching funds, access to primary care, severity of diseases, unemployment, and education levels were found to be key influencers of Medicaid prescription drug expenditure. Increases in all, except education levels, were found to result in increases in drug expenditures. Findings from this study could better inform intervention policies and cost-containment strategies for state Medicaid drug benefit programs.

What variables should be considered in allocating Primary health care Pharmaceutical budgets to districts in Uganda?

“…The study uses past pharmaceutical procurement expenditure data to identify variables explaining primary health care pharmaceutical expenditure. This is in contrast to other studies that have used diagnosis data, pharmacy claims data and individual patient morbidity data [7,11-15]. Such data is not readily available in the Ugandan context.…”

Predictors of primary health care pharmaceutical expenditure by districts in Uganda and implications for budget setting and allocation

“…Most prior studies of this nature have focused on a single category of predictors (e.g. need, demographics or policy factors) and are mainly in developed country contexts that have medicines provided through health insurance [ 9 , 17 , 19 , 20 ]. Additionally, unlike this study, most studies have used individual pharmaceutical expenditure data collected through surveys or from individual medical records [ 11 , 12 ].…”

“…Galbraith, Wong, Kim, and Newacheck used Andersen’s model to select predisposing, enabling, and need variables as independent variables that could affect health care use and expenditures in a multivariate analysis [ 19 ]. Roy and Madhavan used the model to develop an explanatory model for state Medicaid per capita drug expenditures in United States [ 20 ]. Heider et al also employed the model to analyze health care costs in the German elderly population [ 21 ].…”