Rising Medicaid Costs Linked to Direct-to-Consumer Drug Ads

A report in the November 23 issue of Archives of Internal Medicine (one of the JAMA/Archives journals) has opined that direct-to-consumer advertising (DTCA) for a commonly prescribed antiplatelet drug does not appear to be associated with increased usage. But it may be linked to increased drug costs and Medicaid pharmacy expenditures.

"The cost of drugs to public and private health insurance programs has been a long-standing source of concern among policy markers," the authors write as background information in the article. Millions of Americans are enrolled in publicly funded Medicare Part D programs. In addition, prescription drugs are cited as one of the three top reasons for Medicaid expenditure growth, and prescription drug costs have increased by an average of 15.4 percent per year between 1994 and 2004. Meanwhile, spending for DTCA has increased more than 330 percent in the last 10 years.

Michael R. Law, Ph.D., of Centre for Health Services and Policy Research, University of British Columbia, Vancouver, Canada, and colleagues studied the association between DTCA and the use and cost of clopidogrel, a commonly used and heavily marketed (as Plavix) antiplatelet agent. Researchers examined pharmacy data from 27 state Medicaid programs from 1999 to 2005. Changes in the amount of units sold, costs per unit and total pharmacy expenditures after DTCA initiation were noted.

There was no DTCA for clopidogrel from 1999 to 2000. From 2001 to 2005, U.S. spending on DTCA for clopidogrel exceeded $350 million, an average of $70 million per year.

Clopidogrel use in the 27 Medicaid programs did not change after DTCA. However, cost per unit per quarter increased by $0.40 (12 percent) after DTCA for the drug began, leading to an added $40.58 in pharmacy costs per 1,000 Medicaid enrollees per quarter. "Overall, this change resulted in an additional $207 million in total pharmacy expenditures," the authors write.

"Consequently, payers and policy makers should appropriately still be concerned about DTCA increasing total drug costs for publicly funded reimbursement programs such as Medicaid and Medicare. Future longitudinal studies should examine other drugs and settings because many other countries are currently considering whether to permit DTCA," the authors conclude.

Source-Eurekalert
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