A Study on Fixed Budget for Pharmaceutical Expenditures

Abstract

This study investigated the fixed budget as a pharmaceutical cost containment measure. We focused on the universal health care insurance programs of Germany, France, and Taiwan. Fixed budgets for pharmaceuticals were introduced with fixed budgets for office-based physicians fee in national health insurance systems and intended to limit the expenditures on outpatient prescription drugs. The most important reason why their governments have introduced fixed budgets for health expenditures is to contain the skyrocketing health care cost and restore financial stability in the national health insurance systems. Although healthcare providers have not been willing to agree to government's plans on fixed budget systems, social consensus and joint responsibility on health care financial stability are necessary conditions. When pharmaceutical spending exceed the budgetary target, the physician group or pharmaceutical companies could be held responsible for the cost incurred beyond the ceiling. In France, pharmaceutical companies pay back to the national health insurance authority according to their sales and sales growth in each therapeutic class. Even in fixed budget system for pharmaceuticals, drug price control and utilization management are also important in order to ensure quality use of medicines and efficient cost management.