Predictability of drug expenditures: an application using morbidity data

The growth of pharmaceutical expenditure and its prediction is a major concern for policymakers and healthcare managers. This paper explores different predictive models to estimate future drug expenses, using demographic and morbidity individual information from an integrated healthcare delivery org...

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Bibliographic Details
Published in:Health economics 2008-01, Vol.17 (1), p.119-126
Main Authors: García-Goñi, Manuel, Ibern, Pere
Format: Article
Language:English
Subjects:
Adolescent
Adult
Aged
Aged, 80 and over
Child
Child, Preschool
clinical risk groups
Cost estimates
Demography
Drug Costs - statistics & numerical data
drug expenditure
Drugs
Economic models
Expenditure
Expenditures
Female
Health care expenditures
Health economics
Health Status
Humans
Infant
Infant, Newborn
Male
Middle Aged
Morbidity
Pharmaceuticals
Policy making
Risk
Risk adjustment
Risk Assessment
Spain
State Medicine - economics
State Medicine - statistics & numerical data
Studies
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Summary:The growth of pharmaceutical expenditure and its prediction is a major concern for policymakers and healthcare managers. This paper explores different predictive models to estimate future drug expenses, using demographic and morbidity individual information from an integrated healthcare delivery organization in Catalonia for years 2002 and 2003. The morbidity information consists of codified health encounters grouped through the Clinical Risk Groups (CRGs). We estimate pharmaceutical costs using several model specifications, and CRGs as risk adjusters, providing an alternative way of obtaining high predictive power comparable to other estimations of drug expenditures in the literature. These results have clear implications for the use of risk adjustment and CRGs in setting the premiums for pharmaceutical benefits. Copyright © 2007 John Wiley & Sons, Ltd.
ISSN:1057-9230
1099-1050
DOI:10.1002/hec.1238