Impact of the 2012 pharmaceutical co-payment reform on drug consumption among children in Catalonia: Evidence from a regression discontinuity design

Background

Poor childhood health negatively affects health and socioeconomic status later in life. One crucial policy tool is the modification of co-payment conditions, which can cause parents to experience more rigid budget constraints and cause reductions in the number of prescription drugs given to their children.

Objective

This study estimates the price sensitivity of prescription drug demand using data on all prescription drug purchases for the non-adult population in Catalonia from 2010 to 2015.

Methods

We use a sharp regression discontinuity design (RDD) with no bandwidth, exploiting 2012 reforms in Catalonia (Spain).

Results

Our results indicate overall reductions in the defined daily dose (DDD) consumption over three years post-reform for children of parents who experienced increases in their co-payment levels (8.1 % for a 10 % increase). In contrast, those whose parents did not experience a reduction in co-payment rates had a 7.0 percentage point increase in the number of prescriptions used. We corroborated our findings by considering drug stockpiling. Interestingly, prescriptions related to females showed higher reductions than those for males. Disentangling drug consumption by type of condition, we show that drug purchases related to respiratory health conditions experienced smaller reductions and, more specifically, the ones associated with asthma, compared to mental health diseases such as Attention-Deficit/Hyperactivity Disorder.

Conclusions

We evidence significant changes in overall drug consumption for young people in Spain following the reforms of co-payments.