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Analyzing Pharmaceutical Expenditure and Reimbursement Mechanisms in the EU

This presentation, delivered at the PPRI Conference in Warsaw, outlines the public and private funding of pharmaceutical expenditures in Europe, highlighting key statistics such as the percentage of health expenditure dedicated to pharmaceuticals across EU member states. It discusses various cost-containment mechanisms, including discounts, price freezes, and reference price systems, and examines their impact on patient burden. By analyzing private pharmaceutical expenses, co-payments, and prescription fees, we provide insights into the financial dynamics of healthcare in Europe and patient implications.

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Analyzing Pharmaceutical Expenditure and Reimbursement Mechanisms in the EU

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  1. System of counting reimbursement costs by public payers PPRI ProjectChristine LeopoldGesundheit Österreich GmbH PPRI ConferenceWarsaw, 29 October 2007 1

  2. Pharmaceutical Expenditure in %of Health Expenditure (2005) • European averages • EU-25: 18.6% • EU-15: 15.6 % • EU-10: 23.7% • Member States differences • <= 10%: LU, DK, IE, NL; NO • => 25%: BG, HU, LT, PL, SI, SK 2

  3. Public/private funding of pharmaceutical expenditure Source: PPRI 2007 3

  4. Cost-containment mechanism • On the price level • Discounts/rebates • Margin cuts • Price freezes/price cuts • Price reviews • On the reimbursement level • Reference price system • Generic substitution • Claw-back / Pay-back • On the level of doctors • Pharmaceutical budgets • Prescription monitoring • Generic prescribing Do these mechanism increase the burden for the patient? 4

  5. Example: Reference price systems • Methodology • Cluster of equivalent/similar pharmaceuticals • Setting a reference price • Co-payment for pharmaceuticals with higher price • Relevance • in all EU Member States but AT, CY, FI, IE, LU, MT, SE, UK • System of obligatory substitution in SE • Step-price system for off-patent pharmaceuticals in NO 5

  6. Burden for the patients • Private pharmaceutical expenses • Co-payments • Prescription fees (e.g. AT, DK, EE, FI, IT, PL, SK, UK) • Deductibles (IE) • Percentage co-payments • Reference price system 6

  7. Burden for the patients Share of private pharmaceutical expenditure * HU: 2000=2001, 2005 = 2004 Source: OECD Health Data 2007 7

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