Effect of a medication copayment increase in veterans with schizophrenia

Abstract

Objective: To assess the effect of the 2002 Veterans Millennium Health Care Act, which raised pharmacy copayments from $2 to $7 for lower-priority patients, on medication refill decisions and health services utilization among vulnerable veterans with schizophrenia.

Study design: Quasi-experimental.

Methods: This study used secondary data contained in the National Psychosis Registry from June 1, 2000, through September 30, 2003, for all veterans diagnosed with schizophrenia and receiving healthcare through the Department of Veterans Affairs (VA). Longitudinal, mixed models were used to observe changes in prescriptions, health services utilization, and pharmacy costs in veterans subject to copayments (N = 40 654) and a control group of exempt individuals (N = 39 983). Analyses controlled for demographics, substance abuse, non-VA utilization, and medical comorbidities. The Health Belief Model supported analytical criteria for factors directly related to medication adherence issues.

Results: Total prescriptions and overall pharmacy costs leveled among veterans with copayments after the medication cost increase. However, psychiatric drug refills dropped substantially, nearly 25%. Although outpatient visits were unaffected, psychiatric admissions and total inpatient days increased slightly, particularly 10 to 20 months after the policy change. Factoring in additional copayment revenue, the VA realized a $14.7-million annual net revenue gain from this subpopulation alone.

Conclusion: These results suggest the new policy successfully reduced utilization and costs, with perhaps minimal clinical consequences to date. However, higher inpatient utilization resulting from cost-related nonadherence is troubling within an already high-risk and poorly adherent population, especially considering the reduction in psychiatric drug refills.