The effect of pharmaceutical co-payment increase on the use of social assistance—A natural experiment study

Abstract

<p>Health care out-of-pocket payments can create barriers to access or lead to financial distress.<br />Out-of-pocket expenditure is often driven by outpatient pharmaceuticals. In this<br />nationwide register study, we study the causal relationship between an increase in patients’<br />pharmaceutical expenses and financial difficulties by exploiting a natural experiment design<br />arising from a 2017 reform, which introduced higher co-payments for type 2 diabetes medicines<br />in Finland. With difference-in-differences estimation, we analyze whether the reform<br />increased the use of social assistance, a last-resort financial aid. We found that after the<br />reform the share of social assistance recipients increased more among type 2 diabetes<br />patients than among a patient group not affected by the co-payment increase, suggesting<br />the reform increased the use of social assistance among those subject to it. The results indicate<br />that increases in patients’ pharmaceutical expenses can lead to serious financial difficulties<br />even in countries with a comprehensive social security system.<br /></p>