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Lower Drug Copayments Keep Patients Healthier, RAND Study Finds

JANUARY 13, 2006 -- Reducing copayments for patients on cholesterol-lowering medication can keep them healthier and cut U.S. medical costs by more than $1 billion annually, according to a RAND Corporation study.

The report found that when cholesterol-lowering drugs cost less, patients were more likely to take their medication, leading to fewer health problems and hospitalizations.

Researchers based their findings on estimates of about 6.3 million American adults with private insurance or Medicare coverage who take cholesterol-lowering medication. Reducing copayments for the sickest patients would avert nearly 80,000 hospitalizations and more than 31,000 emergency room visits each year, which account for the $1 billion savings estimate.

"There are obstacles to these policies, but our research suggests they should receive wider consideration," the study's lead author, Dana Goldman, said in a news release. Goldman is also director of health economics at RAND Health.

The RAND findings come as Congress is considering new flexibility for states to charge higher copayments to Medicaid beneficiaries as part of budget reconciliation legislation (S 1932) the House is scheduled to consider early next month.

Groups opposed to the legislation say that increasing copayments for Medicaid beneficiaries may discourage them from receiving medical care that can help avoid costly medical complications later. But Bush administration officials have said higher Medicaid copayments will not be a disincentive to seeking care.

The RAND study, published in the January edition of the American Journal of Managed Care, found that patients who had $10 per month copayments for their cholesterol-lowering medication were 6 percent to 10 percent more likely to fully comply with doctors' orders to take the drug than patients who had $20 per month copayments. High-risk patients were less likely to be influenced by higher costs, researchers found.

Researchers also analyzed the link between patients' drug compliance and their use of medical services for up to four years after starting cholesterol-lowering therapy. Researchers found that patients who took their medication regularly had lower hospitalization rates and emergency room visits, particularly for patients with a higher risk profile.

The analysts cautioned, however, that there are some potential problems their study did not address. Health plans with lower drug copayments for high-risk and medium-risk patients may attract higher numbers of sick patients, while discouraging healthier patients who may perceive that they are penalized by being charged higher copayments, researchers concluded.

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