The Impact of Patient Incentives on Comprehensive Diabetes Care Services and Medical Expenditures

Abstract

A large nondurable goods manufacturing firm introduced a value-based insurance design health benefit program for comprehensive diabetes care with six diabetes-related service types subject to a copayment waiver: laboratory tests, physician office visits, diabetes supplies, diabetes medications, antihypertensive (blood pressure) medications, and cholesterol-lowering medications. We evaluated the impact of this natural experiment compared to a matched comparison group drawn from firms with similar composition and baseline trends. We examined the difference-in-differences impact of the program on diabetes-related services, utilization and all-cause spending. In the first year, adherence to oral diabetes medications was 15.0% higher relative to the matched comparison group (p < 0.01) and 14.4% higher in the second year (p < 0.01). The likelihood of adherence to a regimen of diabetes-related recommended diabetes care services (laboratory visits, office visits and medications) was low in the baseline year (5.8% of enrollees) and increased 92.1% in the first year (p < 0.01) and 82% in the second year (p < 0.05). The program was cost-neutral in terms of total all-cause healthcare spending (health plan plus employee out of pocket payments) and all-cause net health plan payments (both p > 0.10). Our analysis suggests that a comprehensive diabetes care program with patient incentives can improve care without increasing direct health plan costs.

Appendix: Terminology

• Copayment—Patient fee when filling a prescription or receiving a medical service

• Adherence—Compliance with a schedule of services or prescription medications

• Copayment Waiver—$0 copayment, no fee

• Cost Neutral—Generates neither a positive nor a negative effect, is neutral

• Out of Pocket—Fees paid by the patient ‘out of pocket’

• (Net) Health Plan Payments—The amount paid by the health plan/insurer.