Drug delisting and reduced reimbursement

• Abstract
• Purpose of health policy or idea
• Characteristics of this policy
• Political and economic background
• Purpose and process analysis
• Expected outcome
• References

Featured in half-yearly report: Health Policy Developments Issue 2

Abstract

The decree of 27 October 1999 reaffirmed the idea to reimburse pharmaceuticals according to their medical service rendered, with two objectives. At first, the idea is to promote the use of the most effective and innovative treatments. Secondly, the expected outcome is the reduction of national health expenditure for medicines.

Purpose of health policy or idea

The decree of 27 October 1999 reaffirmed the idea to reimburse pharmaceuticals according to their medical service rendered. At first, the idea is to promote the use of the most effective and innovative treatments. Secondly, the expected outcome is the reduction of national health expenditure for medicines. The decree had two consequences: the decrease of reimbursement rates of pharmaceuticals having a low or moderate medical service rendered and delisting of pharmaceuticals having an insufficient medical service rendered. Physicians, patients, complementary insurance companies, and pharmaceutical industry are affected by the policy.

• Physicians are encouraged not to prescribe the products having an insufficient medical service rendered.
• The concern of patients can be formulated in terms of access to care, that is access to products : when excluded from the positive list, some products may be no more affordable by patients although they will remain prescribed, either because they have no therapeutic alternative, or because of patients' habits.
• Complementary insurance companies may have to reimburse what is not fully reimbursed by health insurance fund.
• At last, the expected decrease in sales for some products is going to affect the gains of pharmaceutical industry.

Main points

Main objectives

Promote the use of effective and innovative treatments.

Reduce national health expenditure for medicines.

Groups affected

Physicians, Patients, complementary insurance companies, Pharmaceutical industries

Degree of Innovation	traditional		innovative
Degree of Controversy	consensual		highly controversial
Structural or Systemic Impact	marginal		fundamental
Public Visibility	very low		very high
Transferability	strongly system-dependent		system-neutral

The revision of the list of medical goods and services reimbursable by public health insurance seems to be a good idea to contain public health expenditure. The use of clinical assessment to redefine this list is also a good idea, which now applies to medicines, to medical devices, and which is on the political agenda for other types of health services.

We have some difficulties to figure out the impact on this policy:

• Delisting will probably lead to a lower consumption of the drugs
• The decrease of reimbursement rate is more problematic, it is foreseeable that the cost of the measure will be largely supported by complementary insurances.

Political and economic background

The economic and political background is made of two main elements. At first, the reduction of national health expenditure is a goal of health policy. Secondly, a wish of developing evidence-based medicine has been formulated in the 1990's by the Scientific Community.

In order to qualify for reimbursement by the health insurance system, a drug must be included in the positive list of reimbursable drugs established by ministerial ordinance on the advice of the Commission on Transparency and the Economic Committee for Medical Products (CEPS).

Before the decree of 27 October 1999, inclusion on the positive list of reimbursable drugs depended on two factors: the improvement of medical service rendered (ASMR), evaluated in relation to other drugs in the same class, or to a decrease in the cost of treatment.

Since October 1999, in order for a drug to be included on the positive list, evidence must be supplied of it's a valuable medical service rendered (SMR), This is based on five criteria:

• the effectiveness of the drug and its possible side effects
• its place in the therapeutic process, in relation to the alternative therapies available
• the seriousness of the pathology in question
• the curative, preventive or symptomatic properties of the drug
• its importance in terms of public health.

The medical service rendered  is evaluated in absolute terms, for each indication of the product. If the SMR of a product is 'major or considerable' (A), 'moderate' (B) or 'low but nevertheless justifies reimbursement' (C), it can be included in the positive list for a period of five years, after which it has to be re-evaluated. Then, the level of reimbursement should be determined by the SMR as follows :

• important or major SMR : 65% of the price is covered by  health insurance fund
• moderate or low SMR : 35% of the price is covered by health insurance fund
• insufficient SMR : the product is not at all reimbursed 

The evaluation of the improvement of medical service rendered (ASMR) is used in a second time as a price fixation criterion.

Purpose and process analysis

Current Process Stages

	Idea	Pilot	Policy Paper	Legislation	Implementation	Evaluation	Change
Implemented in this survey?

Origins of health policy idea

To deal with the necessity of re-defining criteria for reimbursement of pharmaceutical products, the decree of 27 October 1999 introduced the notion of medical service rendered. It has been decided to attribute to each product a rate of reimbursement by social policy related to its medical service rendered. For some products that implies to decrease their reimbursement rate or to exclude  them from the positive list. Between 1999 and 2001, the Transparency committee attributed  a low or moderate SMR to 840  drugs and an insufficient SMR to 835 drugs and. According to the 1999 decree, the former should no longer figure on the positive list, whereas the later should have a 35 % reimbursement rate. However, until 2003,  few of them had been either excluded from reimbursement or had seen their reimbursement rate lowered from 65 % to 35 %.

Approach of idea

The approach of the idea is described as:
renewed:

Stakeholder positions

Two main groups are directly affected by this re-definition of the positive list: pharmaceutical industry and complementary insurance companies.

• Pharmaceutical companies who produce drugs which reimbursement rate has to fall to 35 % or to 0%, a decrease in the amount of sales can result in big loss. This consequence may be more striking for companies who produce few products, or for whom the major part of the products are concerned by a low, moderate, or insufficient SMR. Some companies criticised the evaluation of service medical rendered by the Commission on transparency and asked for a re-evaluation. They instituted legal procedures and obtained the abrogation of the decrease of reimbursement rate.
• The difference between the amount actually paid by the patient and the amount reimbursed by the health insurance fund remains to be paid by the insured person or, where applicable, by the their complementary voluntary health insurer. As a consequence, for the products which remain reimbursable, but support a decrease of reimbursement rate, the amount in charge of complementary insurance companies will significantly increase.

Moreover, some companies and members of the Scientific Community have hardly criticised both the criteria defined to determine the service rendered and the re-evaluation accomplished by the Commission on transparency.

Influences in policy making and legislation

Until recently only few products having a low or moderate SMR had seen their reimbursement rate lowered from 65% to 35%.  In April 2003, a list of 617 drugs for which rate has decreased has been published in a ministerial decree.

• As far as products with an insufficient SMR 3 waves of delisting have been planned. The first wave,  in summer 2003, consisted in the radiation of 84 drugs from the list of reimbursable pharmaceutical goods by a ministerial ordinance issued the 25th September 2003. Two other waves of radiation may occur in July 2004 and July 2005. At this date, no more drug having an insufficient SMR should be reimbursed by health insurance fund.
• As we mentioned earlier, some pharmaceutical companies criticised both the criteria defined to determine the medical  service rendered and the re-assessment  accomplished by the Transparency committee . After  they had instituted legal procedures, the Council of Sate proclaimed the abrogation of the decrease of reimbursement rate, for 12 products, in July 2003.
• In July 2003, the Ministry of Health made an amendment to protect his decisions resulting from the re-assessment  of the medical service rendered., The Constitutional Council cancelled this amendment in August 2003.
• At last, to face the criticisms formulated about the criteria of medical service rendered and the results of re- assessment, a reform of the Transparency Committee has begun. Its new composition has been published in a decree, the 26th of September 2003.

Legislative outcome

success

Adoption and implementation

Four main actors are implied in the implementation.

• The Transparency Committee assesses the medical service rendered of pharmaceuticals.
• The Government  determines the decrease of rate of reimbursement for special drugs having low or moderate service rendered and the delisting of products having an insufficient service rendered.
• Physicians have to stop prescribing pharmaceuticals having an insufficient service rendered.

Monitoring and evaluation

There is no foreseen mechanism to review the implementation of this process. But the amounts of units prescribed and reimbursed for pharmaceuticals are regularly measured by the compulsory health insurance and the results are detailed according the service medical rendered of the products, and can be compared among time. Consequently, , it will be possible to measure whether expenditure for pharmaceuticals has decreased.

Expected outcome

In the paper "Criteria to be considered in measures in de-reimbursement for drugs" (JEM, October 2002, vol 20 n°6) the authors criticise the perspective retained. They qualify it as very narrow, since it is essentially based on medical efficiency. It would be convenient to widen the risk-benefit criterion and to introduce the concept of social utility, taking into account the equity criterion in the study of epidemiological, cultural and economic characteristics of the population affected by these measures.



As far as the effects on costs are considered  the same authors are very sceptical, according to the paper "What is the purpose of de-reimbursement ?" (Le Monde, 23/01/03). Uncertainty remains in the change of prescribing practices : it may happen that some alternative treatments, prescribed instead of delisted pharmaceuticals, will have a higher cost.

Impact of this policy

Quality of Health Care Services	marginal		fundamental
Level of Equity	system less equitable		system more equitable
Cost Efficiency	very low		very high

The impact on cost-efficiency can not be determined yet because of the uncertainty about the change in prescribing practices and the cost of alternative treatments.

References

Sources of Information

Communiqués de presse du Ministre de la santé, de la famille, et des personnes handicapées (in French)

04/07/03 - Pharmaceuticals having an insufficient service rendered : why a de-reimbursement policy ?

22/04/03 - Decrease of rate of reimbursement for pharmaceuticals having low or moderate service rendered http://www.sante.gouv.fr/ .

Agence française de sécurité sanitaire des produits de santé (AFSSAPS) (in French)

07/06/01 - Re-evaluation of medical service rendered for 4500 special drugs http://agmed.sante.gouv.fr/htm/5/5000.htm .

Journal Officiel (in French)

Décret no 99-915 du 27 octobre 1999

Assurance maladie des professions indépendantes (CANAM) (in French)

March 03 - Drugs expenditure related to medical service rendered

B. Dervaux, T. Lebrun, J.-C. Sailly: What is the purpose of delisting? (in French). In: Le Monde, 23/01/03

C. Debourge, B. Dervaux, J.-C. Sailly: Criteria to be considered in measures in drug delisting. (in French). In: JEM, October 2002, vol 20 n°6.

Author/s and/or contributors to this survey

Florence Naudin, Catherine Sermet

Suggested citation for this online article

Florence Naudin, Catherine Sermet. "Drug delisting and reduced reimbursement". Health Policy Monitor, October 2003. Available at http://www.hpm.org/survey/fr/a2/1