Trends in Prescription Drug Utilization

May 1, 2013

Trends in Prescription Drug Utilization Among Beneficiaries with Private Insurance. Published in Value in Health.

Objectives: The growth in per-member-per-year (PMPY) prescription drug utilization among beneficiaries with private or commercial health insurance coverage has slowed over the past six years, after nearly a decade of steady growth. This is somewhat surprising as the U.S. population ages, the rising prevalence of obesity and related conditions, more choices in lower cost generic medications, and newer drugs to treat chronic conditions.  Particularly for the commercially insured population where the beneficiary is responsible only for deductibles and co-payments, one might expect the trajectory of prescription drug utilization growth to continue uninterrupted.

Methods: Summarized annual utilization statistics from a large pharmacy benefit manager and publicly available data from 1997-2011 was used. Because growth rates may be auto-correlated and a general time trend was evident, we used retrospective time series analysis methods to adjust for auto-correlation and represented our covariates as first differences to make the series stationary.

Results: Our final model contained two covariates in addition to a regression intercept and an auto-regressive parameter: percentage of full-time employees in labor unions and number of “baby boom” generation persons (born between 1946 and 1964) turning age 50.  Parameter estimates were 0.0113 (p = 0.0374) and 2.8064 (p = 0.0074) respectively.

Conclusions:  We believe that the labor union parameter is an overall reflection of employee cost-share and economic conditions related to the economic recession which started in 2007 and slow recovery since the official end of the recession in 2009.  This was exacerbated by changing demographics as baby boomers become eligible for Medicare and are no longer covered by private insurance. Decreased birth rates following the baby boomer cohort have for the time, reduced the available pool of Americans turning 50 each year when the use of chronic medications becomes more common.