Does Medicare Reimbursement Drive Up Drug Launch Prices?

• 成果类型: Article
• 署名作者: Ridley, David B.; Lee, Chung-Ying
• 署名单位: Duke University; National Taiwan University
• 刊物名称: REVIEW OF ECONOMICS AND STATISTICS
• ISSN/ISSBN: 0034-6535
• DOI: 10.1162/rest_a_00849
• 发表日期: 2020-12
• 页码: 980-993
• 关键词: pharmaceutical-industry; part d; prescription; COMPETITION; MARKET; MODEL; uncertainty; INNOVATION; entry

摘要

Medicare reimburses health care providers for the drugs they administer. Since 2005, it has reimbursed based on the past price of the drug. Reimbursement on past prices could motivate manufacturers to set higher launch prices because providers become less sensitive to price and because provider reimbursement is higher if past prices were higher. Using data on drug launch prices between 1999 and 2010, we estimate that reimbursement based on past prices caused launch prices to rise dramatically. The evidence is consistent with the 2018 claim from Medicare's administrator that it creates a perverse incentive for manufacturers to set higher prices.