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Determinants of HMO Formulary Adoption Decisions
Author(s) -
Dranove David,
Hughes Edward F. X.,
Shanley Mark
Publication year - 2003
Publication title -
health services research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.706
H-Index - 121
eISSN - 1475-6773
pISSN - 0017-9124
DOI - 10.1111/1475-6773.t01-1-00111
Subject(s) - formulary , pharmacy , health maintenance , incentive , medicare part d , affect (linguistics) , logistic regression , family medicine , utilization management , medicine , business , actuarial science , medical prescription , prescription drug , marketing , health care , psychology , pharmacology , economics , economic growth , communication , microeconomics
Objective. To identify economic and organizational characteristics that affect the likelihood that health maintenance organizations (HMOs) include new drugs on their formularies. Data Sources. We administered an original survey to directors of pharmacy at 75 HMOs, of which 41 returned usable responses. We obtained drug‐specific data from an industry trade journal. Study Design. We performed multivariate logistic regression analysis, adjusting for fixed‐drug effects and random‐HMO effects. We used factor analysis to limit the number of predictors. Data Collection Methods. We held initial focus groups to help with survey design. We administered the survey in two waves. We asked respondents to report on seven popular new drugs, and to describe a variety of HMO organizational characteristics. Principal Findings. Several HMO organizational characteristics, including nonprofit status, the incentives facing the director of the pharmacy, size and make‐up of the pharmacy and therapeutics committee, and relationships with drugs makers, all affect formulary adoption. Conclusions. There are many organizational factors that may cause HMOs to make different formulary adoption decisions for certain prescription drugs.