Effect of Cost-sharing Changes on Self-monitoring of Blood Glucose

Published Online: July 01, 2007
Andrew J. Karter, PhD; Melissa M. Parker, MS; Howard H. Moffet, MPH; Ameena T. Ahmed, MD, MPH; James Chan, PharmD, PhD; Michele M. Spence, PhD; Joe V. Selby, MD, MPH; and Susan L. Ettner, PhD
Objective: To study the effect of cost-sharing policy changes on utilization of test strips for self-monitoring of blood glucose.

Study Design: A legislative mandate (January 1, 2000) required California health plans to cover diabetes supplies, including those for self-monitoring of blood glucose. One health plan, Kaiser Permanente Northern California, initially waived established copayments and provided free test strips to members with diabetes mellitus for 2 years but later instituted a 20% coinsurance charge for a portion of their membership.

Methods: A retrospective cohort design was used to study pharmacy-based estimates of test strip utilization changes during this natural experiment. Analyses included 2 cohort investigations using pretest-posttest analysis with control subjects to study transitions from a copayment period to a free test strip period and from the free test strip period to a coinsurance period.

Results: During the copayment period, test strip utilization was inversely related to copayments for test strips. Offering free test strips did not increase utilization, even among those paying higher copayments before the policy change. Price-elastic patterns formed before and during the copayment period persisted, despite receiving free test strips for 2 years. The coinsurance, introduced after 2 years of receiving free test strips, resulted in statistically significant (but not clinically relevant) decreased utilization (approximately 1-3 fewer test strips/month). Change patterns did not differ by socioeconomic status.

Conclusions: Offering free test strips shifted costs from patient to health plan, without improving adherence. The introduced coinsurance slightly reduced utilization and adherence to recommendations about self-monitoring of blood glucose. Neither intervention had marked clinical effect. Cross-sectional analyses should not be used to predict utilization changes in the face of rapidly evolving benefit policies.

(Am J Manag Care. 2007;13:408-416)

The Diabetes Control and Complications Trial1 and the United Kingdom Prospective Diabetes Study2 demonstrated the benefits of achieving tight glycemic control in patients with diabetes mellitus (DM) and led to a concomitant promotion of self-monitoring of blood glucose (SMBG) as an integral part of good diabetes care. However, SMBG is consistently practiced less than is recommended by commonly supported guidelines,3-5 including those of the American Diabetes Association.6 Test strips for SMBG are expensive, and SMBG practice is more sensitive to cost sharing3 (ie, price-elastic demand) than many other health services (eg, dilated eye examinations).4 However, current understanding regarding how financial barriers affect utilization is primarily based on cross-sectional analyses.

California Senate Bill 64 (SB64), implemented on January 1, 2000, mandated that California’s health plans provide coverage for diabetes supplies, including those for SMBG. The bill was intended to eliminate a financial barrier to SMBG and to facilitate this self-care practice. In recent years, 37 other states have passed similar legislation. Following similar legislation, rates of SMBG utilization increased, and glycemic control improved after a New England health plan started providing free glucose monitors in 1993.7 In the year before implementation of SB64 (hereafter referred to as the copayment period), a California health plan, Kaiser Permanente Northern California (KPNC), charged members with DM a $0 to $30 copayment for each prescription of test strips, depending on the member’s type of benefit coverage. During the 2 years after SB64 was implemented (January 1, 2000, through December 31, 2001) (hereafter referred to as the free test strip period), test strips were provided free of charge to all KPNC members with DM. A second policy change occurred on January 1, 2002, after which approximately 35% of the commercial membership were charged a 20% coinsurance (approximately $8-$12 per prescription, depending on the brand of test strips) (hereafter referred to as the coinsurance period).

We studied the effects of these 2 benefit policy changes on SMBG practice (as measured by test strip utilization). We hypothesized an increase in individual-level test strip utilization after test strips were provided for free, with the greatest increase among those paying the largest copayments before the implementation of SB64. We assumed that poorer members would be more price sensitive and hypothesized that provision of free test strips would reduce socioeconomic disparities in utilization. We also hypothesized that, after receiving free test strips for 2 years, utilization would decrease after the coinsurance was introduced and that this decrease would be greatest among the poor and among those not treated with insulin.


Study Setting

Kaiser Permanente Northern California is a group-model healthcare organization that provides comprehensive medical services to more than 3 million members (approximately 35% of the population in the surrounding geographic area) through 15 hospitals and 23 outpatient clinics. Study subjects were identified from the KPNC diabetes registry (approximately 132 000 in 2000).

Two cohorts were created to analyze the effect of the 2 separate policy changes. The first was created for the analysis of utilization before and after the introduction of free test strips (hereafter referred to as the free test strip cohort), and the second was created to assess utilization before and after institution of a coinsurance for test strips (hereafter referred to as the coinsurance cohort). For each cohort, we created a sampling frame that included subjects with continuous health plan membership and prescription drug benefits in the prepolicy and postpolicy periods who were also ongoing test strip users (defined as having at least 1 dispensing for test strips during each year of the study). We did not include members without prescription drug benefits and those with prescription drug caps, because they have little financial incentive to purchase SMBG supplies exclusively at KPNC pharmacies and we cannot ascertain utilization at non-KPNC pharmacies. Based on these inclusion criteria, we identified 33 596 subjects in the free test strip cohort and 27 810 subjects in the coinsurance cohort sampling frames. We then excluded 12 241 and 9841 noncommercial health plan members (ie, members in subsidized plans [eg, Medicare]) from the free test strip cohort and the coinsurance cohort, respectively, to reduce case mix, demographic, and socioeconomic heterogeneity in the cohort. Patients enrolled in Medicare received free test strips starting July 1, 1998; this age class would have dominated the reference group if included.

Pharmacy medication dispensing records were then used to classify subjects into the following 3 mutually exclusive treatment groups: patients who use any regimen that includes insulin (hereafter referred to as the insulin group), patients treated only with oral hypoglycemic agents (OHAs) (hereafter referred to as the OHA group), and patients receiving no diabetes pharmacotherapy but receiving medical nutrition therapy (MNT) only (hereafter referred to as the MNT group). Healthcare providers generally encourage increases in SMBG frequency with the intensification of or the introduction of new pharmacotherapy; in these individuals, we would expect an increase in SMBG frequency during this time, independent of the change in the cost of test strips. Therefore, we excluded 2107 and 2323 additional subjects from the free test strip cohort and the coinsurance cohort, respectively, who switched type of diabetes therapy modalities (eg, adding insulin to regimens that previously included oral agents only) during the study period, although we could not exclude those with dosing changes or with additions of other therapies within the oral agent or insulin modality. The final free test strip cohort and coinsurance cohort on which this study was based included 19 248 and 15 646 subjects, respectively.

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Issue: July 2007
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