Unintended Outcomes of Medicaid Drug Cost-Containment Policies on the Chronically Mentally Ill
J Clin Psychiatry 2003;64(suppl 17):19-22
© Copyright 2014 Physicians Postgraduate Press, Inc.
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Cost-containment policies frequently focus on reducing drug expenditures, although prescription
drug costs are a relatively small proportion of total health care expenditures. Data show that very few
drug cost-containment policies can selectively reduce unneeded care while maintaining essential care.
In the early 1980s, the New Hampshire Medicaid program introduced a drug-payment limit (a "cap")
that set the number of reimbursable medications a patient could receive per month at 3. Analyses reviewed
in this article indicate that New Hampshire’s drug cap, while in effect, reduced the use of prescription
drugs among the elderly and the mentally ill but increased hospital and nursing home admissions,
partial hospitalizations, distribution of psychoactive medications by community mental health
centers, and use of emergency mental health services. Vulnerable populations are most likely to experience
adverse effects from hastily-applied drug cost-containment policies, and resulting compensatory
measures may create more expenses than the policy removes.