Effects of Provincial Drug PLan Eligibility on Prescription Drug Utilization among Ontario and British Columbia Seniors
All provincial Ministries of Health in Canada subsidize the prescription drug expenditures of individuals aged 65 and older. This exogenous change in insurance coverage is used to investigate several aspects of the prescription drug utilization of seniors in the provinces of Ontario and British Columbia. First, what is the magnitude of the increase in utilization and insurance program costs once drugs are provided free of charge? The second issue of interest is the incidence of the subsidy. Are any increases in utilization observed concentrated among those with the greatest medical need? Finally, what are the specific effects of the subsidy on physician and patient behavior?
The following conclusions were made. First, the effect of provision of insurance at age 65 is heterogeneous across individuals. Eligibility for insurance was found to increase the number of different drugs taken by Ontario females. In BC, pharmaceuticals use by low income single males in British Columbia was observed to increase. Also, the extension of insurance has made only a minor contribution to growth in seniors' drug utilization, relative to secular trends in utilization by seniors over time. Second, increases in utilization observed among Ontario seniors were concentrated primarily among lower health status individuals. Finally, most of the increases in utilization were among individuals probably already under physician care. The change in drug insurance status did not appear to lead to more physician consultations. The provision of insurance therefore appeared to affect the prescribing patterns of physicians. Given that physicians typically have better knowledge of appropriate drug therapy than patients, this increases the probability that the increased utilization is appropriately prescribed.