Effects of a price cut reform on the cost and utilization of antidiabetic drugs in Korea: a national health insurance database study

Abstract

Background: Despite the potential widespread application and a significant need, the policy effectiveness of prescribed medications price controls has not been studied extensively. We aimed to explore the effects of a price cut introduced in April 1st of 2012 on the cost and utilization of antidiabetics in South Korea.

Methods: We identified approximately four million outpatients who filed at least one diabetes-related claim during the index period (January 2010 to December 2012) using the National Health Insurance claims data. We performed interrupted time series analyses for cost and utilization of "overall," "reduced price," and "constant price" antidiabetics between January 2009 and June 2013, and measured the growth rate for incidents of medical and surgical procedures for diabetes-induced complications.

Results: The segmented regression suggests that spending on overall and reduced price antidiabetics would drop by 6 and 23%, respectively; spending on constant price antidiabetics would rise by 16% in a year after the new pricing compared to if the policy were not in existence. There were a few immediate changes in utilization, and its trend indicated a significant decrease in reduced price antidiabetics and an increase in constant price antidiabetics. Incidents of medical and surgical procedures relating to diabetic complications were unaffected.

Conclusions: The Korean price cut program contained costs by immediately reducing the cost of pharmaceuticals without any major signals associated with compromised clinical conditions in diabetic patients.

Keywords: Antidiabetics; Direct price control; Pharmaceutical costs; Pharmaceutical utilization; Price cut.

Fig. 1

Observed and forecasted costs of antidiabetics. a Overall antidiabetics, b Antidiabetics with reduced price, c Antidiabetics with constant price. Gray band = 95% confidence interval; ° real values; −–– observed trend; −----- forecasted trend. KRW = Korean won (1000 KRW ≒ 1 US dollar)