Researchers who found overall Medicaid costs dropped when Medicaid patients followed prescription drug orders say that information should inform how federal and state dollars are spent on the program.
In 2012, the Congressional Budget Office began to calculate (PDF) if increased drug utilization dropped overall medical costs. That change led to a more accurate assessment of how health policies affect medication use, researchers said. But, for unknown reasons, the CBO does not take into account drug adherence when calculating costs for Medicaid policies. So the researchers wanted to see what would happen if the principal was applied to the public health program for the poor.
For the September issue of Health Affairs, a team led by Christopher Roebuck, a health economist and president of RxEconomics LLC, a policy consulting firm, analyzed data on more than 1.5 million Medicaid enrollees.
The study estimated the effect of medications to treat eight chronic noncommunicable diseases. Researchers found a 1% increase in overall prescription drug use was associated with decreases in total nondrug Medicaid costs by 0.108% for blind or disabled adults, 0.167% for other adults, and 0.041% for children.
“My hope is this approach can be used when policymakers are considering policies related to prescription drug use for Medicaid beneficiaries,” Roebuck said.
Roebuck says that when CBO scores a bill, the formula it is using to calculate the impact of medication adherence for Medicare beneficiaries on overall medical cost should be tweaked to account for differences between the Medicaid and Medicare populations, the poor and elderly, respectively.
As a result, the impact of a change in prescription drugs would not necessarily be the same in both programs, according to the study.
CBO ratings should also take into account, the researchers said, that coverage in Medicare and Medicaid is not identical. Medicaid covers many ancillary services that Medicare does not, such as residential care, personal care services, adult day care, home health and transportation.
“With these caveats in mind, the CBO's figure is best compared to a blend of our inpatient and outpatient medical cost offset estimates from overall prescription drug use,” the study says.