Patient Outcomes and Cost Effects of Medicaid Formulary Restrictions on Antidepressants

Seth A. Seabury 1 , Darius N. Lakdawalla 2 , Deborah Walter 3 , John Hayes 4 , Thomas Gustafson 5 , Anshu Shrestha 6  and Dana P. Goldman 2
  • 1 Associate Professor of Research, Department of Emergency Medicine and the Leonard D. Schaeffer Center for Health Policy and Economics, University of Southern California, USC Schaeffer Center, 635 Downey Way, VPD Suite 210, Los Angeles, CA 90089-3333, USA
  • 2 University of Southern California, Los Angeles, CA, USA
  • 3 Takeda Pharmaceuticals America, Inc., Washington, DC, USA
  • 4 National Network of Depression Centers, Ann Arbor, MI, USA
  • 5 Arnold and Porter, LLP, Washington, DC, USA
  • 6 Precision Health Economics, Los Angeles, CA, USA
Seth A. Seabury, Darius N. Lakdawalla, Deborah Walter, John Hayes, Thomas Gustafson, Anshu Shrestha and Dana P. Goldman

Abstract

Many state Medicaid programs have implemented policies designed to reduce spending on prescription drugs by restricting access to branded products. For patients with major depressive disorder, formulary restrictions could severely limit access to antidepressant therapies and disrupt care. We linked data on patient outcomes and spending from 24 state Medicaid programs to information on formulary restrictions from 2001 to 2008. Outcomes included frequency of MDD-related hospitalizations and ER visits per patient and total healthcare spending. We estimated the effect of the policies on patient outcomes and spending using a difference-and-difference approach. We found that restricting access to antidepressants increased the probability of an MDD-related hospitalization by 1.7 percentage points (16.6%). Furthermore, we found no evidence that these restrictions resulted in any net savings for Medicaid.

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