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Prescription Drug Monitoring Programs: The Role of Asymmetric Information on Drug Availability and Abuse

Angélica Meinhofer
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Angélica Meinhofer: RTI International, Behavioral Health Economics Program Author email:

American Journal of Health Economics, 2018, vol. 4, issue 4, 504-526

Abstract: The diversion of controlled prescription drugs can arise through "doctor shopping," where a patient obtains multiple prescriptions from different health-care providers without the providers' knowledge of the other prescriptions. Prescription Drug Monitoring Programs (PDMPs) aim to address this problem of asymmetric information. In this paper, I exploit cross-state variation in PDMP implementation dates to estimate the effect of PDMPs on drug quantities and deaths. I expand upon previous work by analyzing outcomes for prescription drugs within and outside the opioid class, by considering spillovers into the illegal drug market, and by relying on high-frequency administrative data spanning the years 2000–13. I also estimate the effect of two PDMP characteristics with the potential to narrow information asymmetries among providers: direct PDMP access and required PDMP use. I find that neither PDMP implementation nor direct PDMP access had a significant effect on outcomes. These findings hold across drug classes, drug markets, and specifications. I find evidence, however, suggesting that required PDMP use reduced prescription opioid and stimulant quantities by 9 percent and 11 percent, respectively. In turn, prescription opioid and benzodiazepine deaths decreased by 9 percent and 13 percent, respectively. I also find evidence, albeit weak, suggesting that illegal drug deaths increased.

Keywords: prescription drug monitoring programs; asymmetric information (search for similar items in EconPapers)
JEL-codes: I12 I18 (search for similar items in EconPapers)
Date: 2018
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Handle: RePEc:ucp:amjhec:v:4:y:2018:i:4:p:504-526