Reference pricing is a medication reimbursement policy that provides full coverage for medications that are less expensive than a standard reference price, and it also requires patients to pay the extra cost of higher-priced drugs in a class of therapeutically substitutable drugs. The concept is very similar to three-tier co-pay systems in the United States.
When British Columbia instituted reference pricing for dihydropyridine calcium channel blockers (CCBs), which are used to treat hypertension and angina, it saved money without adversely affecting patients or shifting costs to patients. That's the finding of a recent study supported in part by the Agency for Healthcare Research and Quality (HS09855 and HS10881).
This reference pricing approach may serve as a model for successful pharmaceutical cost-containment without adversely affecting patients, conclude Harvard University researchers, Sebastian Schneeweiss, M.D., Sc.D., and Stephen Soumerai, Sc.D.
Along with their colleagues, Drs. Schneeweiss and Soumerai analyzed changes in drug use, physician visits, hospitalizations, long-term care admissions, and expenditures after the introduction of reference pricing for dihydropyridine CCBs. The study included 35,886 dihydropyridine CCB users at the time of the policy change (January 1, 1997) and a subgroup of 23,116 high-priced dihydropyridine CCB users. All study participants were elderly patients enrolled in the state-funded drug benefits plan in British Columbia, Canada.
The start of reference pricing was followed by a significant reduction in use of high-priced dihydropyridine CCBs (150 fewer monthly doses per 10,000 elderly individuals), with a corresponding increase in fully covered dihydropyridine CCBs (116 more monthly doses). After reference pricing implementation, there was no increase in rates of physician visits, hospitalizations, or long-term care admissions among the overall group. Changes in drug expenditures and physician services resulted in net savings of $1.6 million (Canadian dollars) in the first 12 months of policy implementation.
See "Clinical and economic consequences of reference pricing for dihydropyridine calcium channel blockers," by Drs. Schneeweiss and Soumerai, Malcolm Maclure, Sc.D., and others, in the October 2003 Clinical Pharmacology & Therapeutics 74(4), pp. 388-400.