Pharmaceutical products are distributed through several distribution channels such as retail, hospital, and mail order. Cost containment is the major impetus driving the development of mail order pharmacy. However, currently available empirical evidence that does not support the substitution of community pharmacy by mail order services to reduce overall drug expenditures.
The objective of this study was to compare drug utilization and pharmaceutical expenditures by simulating the effects of community pharmacy on drug utilization for a retiree patient population using mail order pharmacy. The data used for the analysis were pharmacy claims data for the period January 2000-September 2005. Drug claims for each patient were aggregated into courses of drug therapy (CDTs) representing unique patient IDs and unique drug products. Utilization differences between community and mail-order pharmacy were assumed to occur only at the last claim for each CDT. The simulation model employed to estimate the difference in drug utilization using mail-order pharmacy claims data assumed that discontinuation in community pharmacy would follow a random pattern.
A comparison basket of products with at least one claim in both community and mail-order pharmacy during each year from 2000-2005 were selected. Unit costs and expenditures for the medications in the basket were compared across community and mail-order pharmacy.
Seventy two and a half percent of the CDTs dispensed were intended for maintenance therapy and maintenance therapy was more concentrated in mail-order pharmacy as compared to community pharmacy. The use of mail-order pharmacy services resulted in an increase in drug utilization of 2.96% over community pharmacy and a reduction in pharmaceutical expenditures by 10.0-13.0% from 2000-2005. The unit total gross costs in community pharmacy were higher for about half of all products in the comparison basket of products.
The differences in pharmaceutical expenditures between community and mail-order pharmacy were explained by differences in acquisition costs, dispensing fees, and administrative costs. Rebates were not included in the analysis. Decision makers should carefully evaluate the utilization and cost effects that could result from the implementation of mail-order pharmacy programs.