Medical providers as double agents in a universal health care system: evidence from generic pharmaceutical adoption in Taiwan

Tang, Meng-Chi; Wu, Yi-Nong

doi:10.1007/s00181-019-01674-9

Cited by 2 publications

(4 citation statements)

References 22 publications

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“…The statistically significant estimates reveal the providers' agency problem, where the providers might not consider the patients' share of medical expenses when prescribing drugs. Tang and Wu (2020) also found this agency problem among hospital physicians. While their paper focuses on physicians' double agency problem that considers both patients' and payer's utility in their decision, the current paper focuses on the providers' heterogeneity in their agency problem.…”

Section: Resultsmentioning

confidence: 92%

“…In the rest of the paper, I considered a physician as an owner if she was marked as legally obliged for her practicing facility in the basic information file in the National Health Insurance Research Database (NHIRD). Tang and Wu (2020) discussed in length about the incentive structure of the physicians in hospitals and clinics in Taiwan. While clinic owners are obviously responsive to their financial incentives, Cheng (2003) mentioned that most hospitals in Taiwan also provide their staff physicians incentives to generate more revenues.…”

Section: National Health Insurance In Taiwanmentioning

confidence: 99%

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A structural analysis of physician agency and pharmaceutical demand

Tang

2023

Health Economics

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During the summer of 2016, Tzu Chi General Hospital, a major hospital chain in Taiwan with six branches and 3300 beds, planned to replace the 135 brand-name drugs on their formulary to generic ones. Their agenda unexpectedly caught the media's attention due to a leaked internal document prepared for pharmaceutical bidders, which mentions that their drug selection criteria "do not consider the professional feedbacks [from doctors] such as patients' reactions to the drugs or the drug efficacy." The document states that the main criteria are to select the drugs (1) with the highest differences between reimbursed price and acquisition price; (2) adopted by at least one academic medical center; and (3) earning profits equal to or greater than New Taiwan Dollar (NT$) 100,000 for the chain. 1 This profit-oriented choice of drugs highlights the physician agency problem in the pharmaceutical markets in Taiwan. Profit margin and competition with the other medical providers seems to be more important than patients' recovery in providers' prescription decisions. Similar stories were also found in the United States. For example, Meier and Thomas of The New York Times (2012) reported that insurers pay substantially high markups when physicians dispense drugs in their offices. 2 Medical providers were also found to respond to financial incentives when making prescription choices in countries like Sweden

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Section: Resultsmentioning

confidence: 92%

Section: National Health Insurance In Taiwanmentioning

confidence: 99%

A structural analysis of physician agency and pharmaceutical demand

Tang

2023

Health Economics

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“…Another Taiwanese study also revealed that a larger price difference between brand‐name and generic drugs increased the number of generic prescriptions made by physicians, but that this effect decreased for physicians in large hospitals as the NHI program covered more of the cost. Larger hospitals have more power when negotiating the price of brand‐name medications than small hospitals or clinics, and thus pay less for brand‐name medication 45 . Patients also tend to choose brand‐name medications over generic medications as they do not consider generic medications to be equivalent to their brand‐name counterparts, and believe that brand‐name medications have fewer side effects 46–48 .…”

Section: Discussionmentioning

confidence: 99%

“…Larger hospitals have more power when negotiating the price of brand‐name medications than small hospitals or clinics, and thus pay less for brand‐name medication. 45 Patients also tend to choose brand‐name medications over generic medications as they do not consider generic medications to be equivalent to their brand‐name counterparts, and believe that brand‐name medications have fewer side effects. 46 , 47 , 48 A general perception that cheaper drugs means lower quality has also been reported among patients, 49 and that patients are more accepting of generics for the treatment of minor illnesses but prefer branded medicines for serious health problems.…”

Section: Discussionmentioning

confidence: 99%

Clinical outcomes of generic versus brand‐name clopidogrel for secondary prevention in patients with acute myocardial infarction: A nationwide cohort study

Chan

Tung

Lee

et al. 2023

Clinical Translational Sci

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Skepticism exists among healthcare workers and patients regarding the efficacy and safety of generic medication, despite its potential to lower healthcare costs. This study aimed to compare the outcomes of a generic clopidogrel and its brand‐name counterpart for secondary prevention in patients with acute myocardial infarction (AMI). Using the Taiwan National Health Insurance Research Database, we identified 49,325 patients who were hospitalized for AMI between January 1, 2008 and December 31, 2013 and prescribed either generic or brand‐name clopidogrel. Among them, 2419 (4.9%) were prescribed the generic clopidogrel. After propensity score matching, both the generic and brand‐name groups consisted of 2382 patients. The primary efficacy outcome was a composite of myocardial infarction, coronary revascularization, ischemic stroke, and all‐cause death. The primary safety outcome was major bleeding requiring hospitalization. At a mean follow‐up of 2.5 years, the generic and brand‐name clopidogrel groups had comparable risks of primary efficacy outcome (41.9% vs. 42%; hazard ratio [HR] 0.96; 95% confidence interval [CI] 0.88–1.04), and the risks of the individual components were also similar. There were no significant differences between the two groups in major bleeding (7.9% vs. 7.9%; HR 0.99; 95% CI 0.81–1.21). Subgroup analyses also revealed no statistically significant interactions between the treatment effect and various subgroups. In this retrospective database analysis, the generic clopidogrel was comparable to its brand‐name counterpart regarding cardiovascular and bleeding outcomes for the treatment of patients with AMI.

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Medical providers as double agents in a universal health care system: evidence from generic pharmaceutical adoption in Taiwan

Cited by 2 publications

References 22 publications

A structural analysis of physician agency and pharmaceutical demand

A structural analysis of physician agency and pharmaceutical demand

Clinical outcomes of generic versus brand‐name clopidogrel for secondary prevention in patients with acute myocardial infarction: A nationwide cohort study

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