The effect of incentive-based formularies on prescription-drug utilization and spending.

Background: Many employers and health plans have adopted incentive-based formularies in an attempt to control prescription-drug costs.

Methods: We used claims data to compare the utilization of and spending on drugs in two employer-sponsored health plans that implemented changes in formulary administration with those in comparison groups of enrollees covered by the same insurers. One plan simultaneously switched from a one-tier to a three-tier formulary and increased all enrollee copayments for medications.

Managing psychotropic drug costs: will formularies work?

Payers of pharmaceutical benefits are increasingly turning to drug formularies in an attempt to control rising pharmacy costs, including those for psychotropic drugs. In this paper I examine several issues that policymakers should consider when addressing formulary design for psychotropic drugs: heterogeneity within mental health disorders and limited information about treatment effectiveness for individual patients; the potential for plans to try to use formularies to avoid adverse selection and implications for psychotropic coverage; the interaction of Medicaid formulary policy and manufacturers' incentives for psychotropic innovation; and incentives created by mental health institutions that decrease formularies' potential effectiveness in controlling psychotropic drug costs.

The impact of a national prescription drug formulary on prices, market share, and spending: lessons for Medicare?

Several recent bills in Congress to add a Medicare prescription drug benefit would allow the use of formularies to control costs. However, there is little empirical evidence of the impact of formularies among elderly and disabled populations. We assess the effect of a closed formulary implemented by the Veterans Health Administration (VHA) in 1997 on drug prices, market share, and drug spending.

Aligning incentives in the treatment of depression in primary care with evidence-based practice.

Deficits in the quality of treatment of depression in the primary care sector have been documented in multiple studies. Several clinical models for improving primary care treatment of depression have been shown to be cost-effective in recent years but have not proved to be sustainable over time, partly because of barriers created by common organizational and financing arrangements such as managed behavioral health care carve-outs and risk-based provider payment mechanisms. These arrangements, which often distort relative costs that primary care physicians face when making treatment decisions for patients who have depression, can steer these decisions away from evidence-based practice.

What is known about the economics of end-of-life care for medicare beneficiaries?

Purpose: This article reviews the state of science on the economics of end-of-life care for Medicare beneficiaries and outlines the research needed to fill gaps in that literature.

Designs And Methods: Searches of the medical, health services, and economics literature were conducted. Key topics examined were studies of spending on end-of-life care and financial, organizational, and nonfinancial barriers to high-quality end-of-life care.

The evolution of quality management in state Medicaid agencies: a national survey of states with comprehensive managed care programs.

Background: Concern has been expressed about whether managed care health plans can successfully meet the special needs of Medicaid beneficiaries. A 1996 survey indicated that state Medicaid agencies had just begun conducting quality oversight and management. Since then the federal government has released guidelines under the Quality improvement System for Managed Care (QISMC) program to assist states with quality management of managed care programs.