Rx COPAY INCREASES MAY BACKFIRE ON COST CUTTERS

SEPTEMBER 01, 2007
Employers hoping to reduce the rising cost of employee health coverage should think twice before raising prescription drug copays for workers, researchers at Carnegie Mellon University found in a new study of health care expenses.

?What most employers don?t consider is that increased copays on drugs may lead to an increase in other types of health care,? explained a spokesman for the researchers.

The authors of the study, published recently in Forum for Health Economics and Policy, concluded that when prescription copays rise employees react by buying fewer drugs, saving money for the employer. The higher copay requirements, however, also encourage workers to rely on health care ?substitutions.? This result leads to increased physician or emergency room visits, which are more costly in the long run.

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