Regional Variation in Medication Adherence

Gibson Teresa B, Landrum Mary Beth, Batata Amber, Fendrick A. Mark, Wang Sara and Chernew Michael E.
Additional contact information
Gibson Teresa B: Thomson Reuters, teresa.gibson@thomsonreuters.com
Landrum Mary Beth: Harvard Medical School, landrum@hcp.med.harvard.edu
Batata Amber: Pfizer Inc., amber.batata@pfizer.com
Fendrick A. Mark: University of Michigan, Amfen@umich.edu
Wang Sara: Formerly of Thomson Reuters, csshw@yahoo.com
Chernew Michael E.: Harvard Medical School, chernew@hcp.med.harvard.edu

Forum for Health Economics & Policy, 2011, vol. 14, issue 1, 22

Abstract: An extensive literature has demonstrated geographic variation in medical services and this variation has been largely attributed to the health care system and not to regional differences in patient behavior. We use empirical Bayes shrinkage models, conditional on patient, firm, and market covariates, to investigate geographic variation in adherence to prescription medications across hospital referral regions (HRRs). Models are estimated for commercially insured patients in 11 combinations of chronic diseases and drug classes. We use factor analysis to create a market-level composite measure of adherence that we relate to adjusted market-level spending on non-drug services. We find that there is a very small amount of variation in adherence to prescription drugs across HRRs supporting the widely held assumption that geographic variation is attributable to the health system. Markets with high adherence have systematically lower medical spending, and this inverse correlation is more likely due to unobserved market traits.

Keywords: regional variation; prescription medication; adherence; commercial insurance (search for similar items in EconPapers)
Date: 2011
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DOI: 10.2202/1558-9544.1249

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