Transferring the financial risks of pharmaceutical benefits from a large health care provider in Argentina to a consortium of pharmaceutical companies

• Main Authors: Cervellino Juan C., Corazza Sandra B., Bignone Inés M.I., Fligman M. Diana, Figueroa Silvana, Roldán Rubén, Morici Pablo, Diez Roberto A.
• Format: Article
• Language: English
• Published: Pan American Health Organization 2003-01-01
• Series: Revista Panamericana de Salud Pública
• Subjects: Health care economics and organizations; drug utilization; prescription drugs; national health programs; Argentina
• Online Access: http://www.scielosp.org/scielo.php?script=sci_arttext&pid=S1020-49892003000300002

OBJECTIVE: The National Institute of Social Services for Retirees and Pensioners (NISSRP) is a nationwide health care financing agency and service provider in Argentina. Among its services, the NISSRP provides outpatient drug coverage to more than 3.3 million beneficiaries, mainly senior citizens and disabled persons. In 1997, to help cope with its rising costs, the NISSRP agreed to transfer the risk for the cost of outpatient medications and cancer-treatment drugs to a consortium of pharmaceutical companies in exchange for a fixed monthly payment. The objective of this study was to determine the impact that this new approach had on three things: (1) the level of expenditures for the medicines that were included in the agreement, (2) the pattern of nonrational prescribing for NISSRP beneficiaries, and (3) this pattern's relationship with macroeconomic variables and the pattern of prescribing for Argentina as a whole. METHODS: We compared outpatient-medicine consumption in 1999 with consumption before the agreement went into effect. RESULTS: The actual amount that NISSRP beneficiaries spent out-of-pocket climbed from US$ 336.13 million in 1996 to US$ 473.36 million in 1999, an increase of almost 41%. The nominal amount "spent" by the NISSRP in 1999 was US$ 601.11 million, versus a real amount of US$ 374.75 million in 1996, an "increase" of 60% (that increase for the NISSRP was only theoretical since the agreement specified the fixed monthly amount that the NISSRP would have to pay to the pharmaceutical consortium). In contrast with the increased real spending by NISSRP beneficiaries, Argentina's economy remained stable over the assessed period, with the consumer price index even falling by 0.8%. We found high levels of nonrational drug use in the NISSRP system in both 1996 and 1999, indicating a serious ongoing problem. CONCLUSIONS: An agreement with pharmaceutical companies, like the one we have described, might add an element of financial predictability for institutions such as the NISSRP. However, such an agreement can easily result in an increased economic burden for health care beneficiaries, and without any improvement in the services that they receive. This type of agreement requires extensive mechanisms for control, follow-up, and updating, and it also risks making nonrational drug prescribing the accepted rule. While perhaps feasible, the requirements for this kind of agreement are actually very difficult to put into place, requiring additional efforts from institutions such as the NISSRP.