Drug price increase leads to death

It turns out $10 can be a matter of life and death, according to a new study on how patients respond to higher health care costs.

Researchers at Harvard University and the University of California Berkeley examined what happened when Medicare beneficiaries faced an increase in their out-of-pocket costs for prescription drugs. They found that a 34 percent increase (a $10.40 increase per drug) led to a significant decrease in patients filling their prescriptions — and, eventually, a 33 percent increase in mortality.

The rise in deaths resulted from people indiscriminately cutting back on medications when they had to pay more for them, including drugs for heart disease, hypertension, asthma, and diabetes.

“We find that small increases in cost cause patients to cut back on drugs with large benefits, ultimately causing their death,” the authors — Amitabh Chandra, Evan Flack, and Ziad Obermeyer — wrote. “Cutbacks are widespread, but most striking are those seen in patients with the greatest treatable health risks, in whom they are likely to be particularly destructive.”

It is difficult to come up with a study design that directly measures the effect of health insurance on health outcomes. These researchers overcame that problem by tracking the prescription benefits for people newly enrolling in Medicare when they turn 65. People with birthdays earlier in the year would be more likely to face higher out-of-pocket costs than people with birthdays later in the year, given the way Medicare’s benefits are designed. By comparing the data between the different age groups, using as a baseline an estimate of how much the patients would have been expected to spend without any cost-sharing, the researchers were able to isolate the effect of cost-sharing on the use of prescription drugs and mortality rates for patients.