Sascha G. Wolf, Conclusion in:

Sascha G. Wolf

Pharmaceutical Expenditure in Germany, page 90 - 92

Future Development, Political Influence and Economic Impact

1. Edition 2009, ISBN print: 978-3-8329-4164-2, ISBN online: 978-3-8452-2005-5

Series: Neue Studien zur Politischen Ökonomie, vol. 6

Bibliographic information
90 5. Conclusion This work is concerned with the pharmaceutical sector of the German Statutory Health Insurance System (SHI). The above analysis considered three of the most discussed issues in health economics and health politics: the impact of population ageing on the development of drug expenditure; the importance of politicians’ interests for health policy; and the in? uence of different kinds of control instruments on the market behaviour of pharmaceutical manufacturers. Chapter 2 delivered the most comprehensive approach in literature to identifying the impact of population ageing on the development of drug disbursements in the SHI. Using comprehensive panel data, principal components and cluster analysis have been accomplished. It could be shown that indications for both compression and medicalisation theses can be found depending on what kinds of disturbances of health are affected: consumption of drugs against acute, age-dependent diseases is characterised by the compression thesis, whereas consumption of drugs against chronic diseases is characterised by the medicalisation thesis. Thus in particular the usage of drugs against chronic af? ictions of health determines future development of pharmaceutical expenditure. Based on these ? ndings an outlook on future development of drug costs has been delivered by means of linear regression. By 2050, pharmaceutical expenditure of the SHI will have increased by 75 % in total and 92 % per capita. Consequently, the ? nancial burden for individuals will increase sharply. But there will be no “cost explosion”. The purely demographic effect plays only a minor role for future cost developments; what is most important is the alteration of the insurants’ per capita age-related drug expenditure pro? les. Chapter 3 considered the importance of politicians’ interests for health policy. In scienti? c literature it is usually argued that the complex political negotiation and decision-making processes as well as the in? uence of strong interest groups prevent the introduction of strong and effective control instruments into the health care sector. A closer look, however, reveals a different picture: we saw political cycles in expenditure developments with signi? cant amplitudes before federal elections. This observation re? ects the ability of government to in? uence costs despite the restrictions in decision-making. By means of two different econometric approaches, an ordinary least squares regression in ? rst differences and an error correction model, four kinds of political interests have been tested. It was shown that health policy in Germany is especially affected by partisan politics. Additionally, we found indication for partisan as well as opportunistic politics in combination with ambitions of the pharmaceutical industry itself. The econometric ? ndings and the empirical observations clearly suggest that political parties deliberately use health politics to pursue self-oriented interests. Chapter 4 compared the impact of two ? nancing instruments which have attracted attention in the last few years, reference pricing (RP) and Medical Savings Accounts (MSAs), on competition and the price-setting strategies of pharmaceutical manufac- 91 turers. By playing a Stackelberg game in a vertical product differentiation model with two ? rms, one brand-name drug producer and one generic competitor, it was shown that both instruments deliver more ef? cient results than simple proportional co-payments arrangements. But compared to RP, a system of MSAs results in lower prices and lower manufacturers’ pro? ts. Since neither quality nor the comprehensiveness of medical availability is endangered, MSAs are a viable method to introduce market competition into the SHI’s pharmaceutical sector. Financing pharmaceutical expenditure in the SHI via MSAs can be strongly recommended. Together the results of this work draw an optimistic picture of the chances of reaching ? nancial sustainability of the SHI’s pharmaceutical sector. Firstly, in spite of increasing future drug costs, no indication for any dramatic cost explosion in the pharmaceutical sector can be found. Secondly, in contrast to the common belief in literature, governments are indeed able to introduce strong control instruments even against restrictions in political decision making due to complex legislative procedures and interests groups in? uence. And, ? nally, with MSAs there exist an achievable and ef? cient institutional framework to establish market mechanisms into the health care sector. In a way, health politics hold it all in its hand. 92

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Der Arzneimittelsektor der Gesetzlichen Krankenversicherung stand wiederholt im Fokus zahlreicher Gesundheitsreformen. Dennoch ist es bislang nicht gelungen, den Trend steigender Ausgaben nachhaltig zu bremsen. Die vorliegende Untersuchung leistet einen Beitrag dazu, die Ursachen dieser Entwicklung zu erklären und Lösungsansätze aufzuzeigen. Mittels Hauptkomponenten- und Cluster-Analyse wurden Gruppen von Arzneimitteln mit vergleichbaren Konsumeigenschaften gebildet. Jede Gruppe wurde auf den Einfluss der Altersabhängigkeit und des technologischen Fortschritts hin analysiert. Aufbauend auf diesen Ergebnissen wurde eine Prognose der zukünftigen Ausgabenentwicklung bis zum Jahr 2050 erstellt. Obwohl die Hauptkostenfaktoren exogen sind, steht der Gesetzgeber dem vorhergesagten ansteigenden Kostenpfad nicht hilflos gegenüber. Im Gegenteil: Anhand ökonometrischer Tests wird gezeigt, dass die Gesundheitspolitik in der Vergangenheit durch wahl- und klientelorientierte Interessendurchsetzung geprägt war. Mehr Effizienz in der Arzneimittelversorgung könnte durch die Einführung individueller Gesundheitssparkonten erzielt werden. Dies bestätigen die Resultate eines vertikal differenzierten Wettbewerbsmodells.