EFFECTS OF LIMITING MEDICAID DRUG-REIMBURSEMENT BENEFITS ON THE USE OF PSYCHOTROPIC AGENTS AND ACUTE MENTAL-HEALTH-SERVICES BY PATIENTS WITH SCHIZOPHRENIA

Background. We examined the effects of a three-prescription monthly pa yment limit (cap) on the use of psychotropic drugs and acute mental he alth care by noninstitutionalized patients with schizophrenia. We hypo thesized that reducing access to such drugs would increase the use of emergency mental health services and the rate of partial hospitalizati ons (full-day or half-day treatment programs) and psychiatric-hospital admissions. Methods. We linked Medicaid claims data for a period of 4 2 months with clinical records from two community mental health center s (CMHCs) and the single state psychiatric hospital in New Hampshire, where Medicaid imposed a three-prescription limit on reimbursement for drugs during 11 months (months 15 through 25) of the study. For compa rison, we used Medicaid claims for a period of 42 months in New Jersey , which had no limit on drug reimbursement. The study patients (n = 26 8) and the comparison patients (n = 1959) were permanently disabled, n oninstitutionalized patients with schizophrenia, 19 through 60 years o f age, who were insured by Medicaid. We conducted interrupted time-ser ies regression analyses to estimate the effects of the cap on the use of medications and mental health services. Results. The cap resulted i n immediate reductions (range, 15 to 49 percent) in the use of antipsy chotic drugs, antidepressants and lithium, and anxiolytic and hypnotic drugs (P<0.01). It also resulted in coincident increases of one to tw o visits per patient per month to CMHCs (range of increase, 43 to 57 p ercent; P<0.001) and sharp increases in the use of emergency mental he alth services and partial hospitalization (1.2 to 1.4 episodes per pat ient per month), but no change in the frequency of hospital admissions . After the cap was discontinued, the use of medications and most ment al health services reverted to base-line levels (measured in the first 14 months of the study). The estimated average increase in mental hea lth care costs per patient during the cap ($1,530) exceeded the saving s in drug costs to Medicaid by a factor of 17. Conclusions. Limits on coverage for the costs of prescription drugs can increase the use of a cute mental health services among low-income patients with chronic men tal illnesses and increase costs to the government, even aside from th e increases caused in pain and suffering on the part of patients.