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- W2103016712 abstract "UNIVERSITY OF CALIFORNIA AT BERKELEY Department of Economics Berkeley, California 94720-3880 Working Paper No. 97-258 Demand for Prescription Drugs: The Effects of Managed Care Pharmacy Benefits Rika Onishi Mortimer Department of Economics University of California, Berkeley November 1997 This paper examines how demand for prescription drugs is influenced by different types of insurance. In order to understand demand characteristics and the competitiveness of pharmaceutical markets, both intermolecular (therapeutic) and intramolecular (generic) substitutions are studied in the antidepressant and beta blocker (anti-hypertensive) markets. Mixed logit and other discrete choice models are applied to national survey and product sales data. The results indicate that demand in managed care sectors is more price elastic than in other sectors. Demand in the self-paid sector is found to be the least price elastic, despite the fact that patients must pay for the entire cost of drugs. The results confirm the effectiveness of managed care incentives in sfrifting prescription patterns toward less expensive products, and suggest the existence of an agency problem between physicians and patients. JEL Classification: I11,L65 I would like to thank IMS America for generously providing data for this research. I am also grateful to Bronwyn Hall, Theodore Keeler, Kenneth Train, Richard Scheffler, Scott Stern, and Sean Sullivan for their valuable comments and advice. I am also indebted to Erik Heitfield, Jimmy Chan, John Giles, Daniel Covitz, and Jim Prieger for helpful suggestions. Finally, I would like to thank my husband Scott for his support and patience during my dissertation writing. All mistakes are my own." @default.
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- W2103016712 date "1997-11-01" @default.
- W2103016712 modified "2023-09-27" @default.
- W2103016712 title "Demand for Prescription Drugs: The Effects of Managed Care Pharmacy Benefits" @default.
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