Effects of reimbursement restriction on pharmaceutical expenditures : A case of Ginkgo biloba

Abstract

Since May 1st in 2008, the products of ginkgo biloba extract have had to be used with the patient`s out-of-pocket payment due to reimbursement restriction guidelines. This study aims to analyze the policy effects of reimbursement restriction on pharmaceutical expenditures using interrupted time series(ITS) analysis. We retrieved monthly NHI claims data for the period between May, 2005 and December 2009. The ingredients identified as a substitute for ginkgo biloba have similar indications based on the similar pharmacological activities. The effects of changes in reimbursement scope were evaluated both for all relevant pharmaceuticals within the same therapeutic class and for 2 separate groups : ginkgo biloba`s and its substitutes. According to the study results, restrictions on reimbursement scope resulted in savings of the drug expenditures in the targeted therapeutic class. Direct restriction on ginkgo biloba was associated with a decrease in expenditure level by 60.1% and changes in trend from an average increase rate of 1.4% to an average decrease rate of 1.5% for the therapeutic class, with a dramatic decrease in expenditure level(-191.5%) for ginkgo biloba itself, but with an increased expenditure level(+50.1%) and changes in trend from an average increase rate of 2.0% to an average decrease rate of 1.0% for the substitute group. Further policy to restrict nicergoline was associated with additional decrease in expenditure level for the therapeutic class. Additionally, we could identify the balloon effect - a new policy squeezing one part results in bulging out elsewhere. After the restriction of ginkgo biloba, the utilization of and expenditures on its substitutes increased significantly. In conclusion, we demonstrated that consecutively introduced policies effectively reduced overall expenditures on the therapeutic class of interest. Some ingredients played as a substitute while others did not. Further studies need to be conducted to identify which factors determine a substitute.