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Lead me not into temptation: drug price regulation and dispensing physicians in Switzerland

Rischatsch, Maurus

In: The European Journal of Health Economics, 2014, vol. 15, no. 7, p. 697-708

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    Title
    • Lead me not into temptation: drug price regulation and dispensing physicians in Switzerland
    Author
    • Rischatsch, Maurus. Department of Economics, University of Zurich, Zurich, Switzerland
    Document Type
    • Postprint
    Language
    • English
    Published in
    • The European Journal of Health Economics, 2014, vol. 15, no. 7, p. 697-708. Springer Berlin Heidelberg
    Other Version
    OAI-PMH Identifier
    • oai:doc.rero.ch:325516
    Summary
    While most countries separate drug prescription and dispensation to ensure independent drug choice, some allow this combination to increase pharmaceutical access in rural areas or to increase the utilization of pharmacist skills. A drawback of this approach is that dispensing physicians or prescribing pharmacists may be incentivized to increase their own profits through the prescription of cost-inefficient drug packages, leading to an increase in pharmaceutical spending. Switzerland constitutes an interesting example of where dispensing and non-dispensing physicians coexist, permitting a comparison of their prescribing behavior. The present study shows that drug margin optimization is possible under the current drug price regulation scheme in Switzerland. Using drug claims data, empirical findings indicate a 5-10% higher margin per dose for dispensing physicians compared to pharmacists. Cost per dose is 3-5% higher when dispensed by physicians instead of pharmacists.