Tiered co-payments, pricing, and demand in reference price markets for pharmaceuticals

verfasst von

Annika Herr, Moritz Suppliet

Abstract

Health insurance companies curb price-insensitive behavior and the moral hazard of insureds by means of cost-sharing, such as tiered co-payments or reference pricing in drug markets. This paper evaluates the effect of price limits – below which drugs are exempt from co-payments – on prices and on demand. First, using a difference-in-differences estimation strategy, we find that the new policy decreases prices by 5 percent for generics and increases prices by 4 percent for brand-name drugs in the German reference price market. Second, estimating a nested-logit demand model, we show that consumers appreciate co-payment exempt drugs and calculate lower price elasticities for brand-name drugs than for generics. This explains the different price responses of brand-name and generic drugs and shows that price-related co-payment tiers are an effective tool to steer demand to low-priced drugs.

Externe Organisation(en)

Universitätsklinikum Düsseldorf
Tilburg University

Typ

Artikel

Journal

Journal of health economics

Band

56

Seiten

19-29

Anzahl der Seiten

11

ISSN

0167-6296

Publikationsdatum

12.2017

Publikationsstatus

Veröffentlicht

Peer-reviewed

Ja

ASJC Scopus Sachgebiete

Health policy, Öffentliche Gesundheit, Umwelt- und Arbeitsmedizin

Ziele für nachhaltige Entwicklung

SDG 3 – Gute Gesundheit und Wohlergehen

Elektronische Version(en)

https://doi.org/10.1016/j.jhealeco.2017.08.008 (Zugang: Geschlossen)