Value of Medication Adherence in Chronic Vascular Disease:Fixed Effects Models of Health Services Utilization and Cost Roebuck, MC, MBA; Liberman, JN, PhD; Gemmill-Toyama, MC, PhD; Brennan, TA, MD, JD, MPH

©2010 Caremark. All rights reserved.

RESEARCH OBJECTIVETo examine the relationship between adherence to medication therapy and the utilization and cost of health services in four chronic vascular disorders (congestive heart failure, hypertension, diabetes and dyslipidemia); while addressing the potential endogeneity of adherence. Effect estimates from prior studies may be biased due to unobservables correlated with both adherence and health services utilization and cost.

STUDY DESIGNA longitudinal claims analysis of patients with continuous insurance coverage from 1/1/05 to 6/30/08. Condition cohorts were constructed using ICD-9-CM codes. Medical and pharmacy claims data were used to derive six annual measures of health services utilization and cost: inpatient hospital days, emergency department visits, outpatient physician visits, pharmacy costs, medical costs and total health care costs. Patients were defined as adherent where their condition-level Medication Possession Ratios were at least 0.80. Fixed effects models were estimated to control for the potential endogeneity of adherence.

POPULATION STUDIEDThe sample consisted of 16,353 patients with congestive heart failure, 112,757 with hypertension, 42,080 with diabetes and 53,041 with dyslipidemia.

PRINCIPAL FINDINGS• Medication adherence was associated with fewer

inpatient hospital days and emergency department visits, and a greater number of outpatient physician visits

• Higher drug costs were more than offset by lower medical costs with annual total health care cost savings amounting to:- $7,823 for congestive heart failure- $3,908 for hypertension

- $3,756 for diabetes- $1,258 for dyslipidemia

• Benefit-cost ratios ranged from 2:1 for non-senior adults with dyslipidemia to over 13:1 for seniors with hypertension

• Adherence effects were generally greater in magnitude for seniors than for non-seniors

CONCLUSIONSTo fully understand the clinical and economic impacts of prescription drug use in community-based settings, researchers must also rely on carefully executed observational studies. In the absence of randomization, causality is difficult to establish, however advanced econometric techniques can be used to reduce potential bias in effect estimates.

This study extends the literature on the impact of medication adherence on health services utilization and cost. Using a large panel dataset, fixed effects modeling controlled for the potential endogeneity of adherence. Results confirm that despite higher

Congestive Heart Failure Hypertension Diabetes Dyslipidemia(n = 16,353) (n = 112,757) (n = 42,080) (n = 53,041)

0.550 0.487 0.532 0.502(0.497) (0.500) (0.499) (0.500)

77.301 68.401 67.872 65.096(10.600) (13.692) (13.745) (14.157)

0.872 0.614 0.615 0.517(0.334) (0.487) (0.487) (0.500)

2.025 1.112 1.696 1.001(1.365) (1.222) (1.179) (1.173)

11.901 3.291 4.255 2.239(26.973) (13.967) (16.458) (11.148)

0.613 0.318 0.353 0.265(1.156) (0.827) (0.891) (0.745)

11.651 8.506 9.407 8.660(10.306) (7.811) (8.458) (7.836)

3,780 2,867 3,624 2,920(4,493) (3,901) (4,371) (4,078)

39,076 14,813 17,955 12,688(81,569) (42,371) (50,042) (39,477)

42,856 17,680 21,580 15,608(82,058) (43,047) (50,753) (40,256)

0.400 0.591 0.513 0.522(0.435) (0.417) (0.426) (0.427)

0.340 0.505 0.412 0.426(0.474) (0.500) (0.492) (0.495)

Notes: Presented are means with standard deviations in parentheses for last year of study period (7/1/07-6/30/08).

Annual Total Health Care Costs ($)

Medication Possession Ratio (MPR)

Adherent (MPR≥0.80)

Annual Emergency Department Visits

Annual Outpatient Physician Visits

Annual Pharmacy Costs ($)

Annual Medical

Age

Senior (age≥65)

Charlson Comorbidity

Annual Inpatient Hospital Days

Descriptive Statistics by Chronic Vascular Condition

Variable

Male

Index

Costs ($)

Marginal Effects of Adherence on Health Services Utilization and Cost

-5.72

1.13

-2.14 -2.39-1.78

-0.04 -0.03

0.04

-0.02

0.35 0.27

-0.01

-6-5-4-3-2-1012

Annual Inpatient Hospital Days(Adherent vs. Non-Adherent)

Annual EmergencyDepartment Visits

(Adherent vs. Non-Adherent)

Annual OutpatientPhysician Visits

(Adherent vs. Non-Adherent)

-5.87

1.22

-3.14 -3.41

-1.88-0.01

0.01

-0.05

0.45

-0.02

0.37

-6-5-4-3-2-1012

Annual Inpatient Hospital Days(Adherent vs. Non-Adherent)

Annual EmergencyDepartment Visits

(Adherent vs. Non-Adherent)

Annual OutpatientPhysician Visits

(Adherent vs. Non-Adherent)

($7,823)

($4,337) ($3,908)($4,413)($3,756)

($1,860) ($1,258)$1,058

($8,881)

$429 $656 $601

($10,000)

($8,000)

($6,000)

($4,000)

($2,000)

$0

$2,000

Annual Pharmacy Costs(Adherent vs. Non-Adherent)

Annual Medical Costs(Adherent vs. Non-Adherent)

Annual Total Health Care Costs(Adherent vs. Non-Adherent)

Congestive Heart Failure Hypertension Diabetes Dyslipidemia

($8,934)($7,893)

($5,847)($5,170)

($2,502)($1,847)

$1,040

($5,824)($6,292)

$467 $676 $655

($10,000)

($8,000)

($6,000)

($4,000)

($2,000)

$0

$2,000

Annual Pharmacy Costs(Adherent vs. Non-Adherent)

Annual Medical Costs(Adherent vs. Non-Adherent)

Annual Total Health Care Costs(Adherent vs. Non-Adherent)

Utilization (All Individuals)

Notes: Unless denoted with “ns”, presented are statistically signi�cant (p<0.01) marginal e�ect estimates from linear �xed e�ects models of health services utilization and cost. All models included a weighted Charlson Comorbidity Index; two year indicator variables; dummy variables for senior, male, and adherent; and interaction terms for adherent with male and senior.

Cost (All Individuals)

Utilization (Seniors) Cost (Seniors)

-0.01ns

ns

ns

pharmacy costs, medication adherence provided substantial medical savings, likely due to reductions in hospitalization and emergency department use.

IMPLICATIONS FOR POLICY, DELIVERY, OR PRACTICEPolicies that improve medication adherence may be worthwhile investments for plan sponsors and patients. Disease management programs, pharmacist-consumer engagement, and physician education are among the alternatives. Value-based insurance designs may be particularly attractive since economic incentives are well-known to affect patient behavior.