Out-of-Pocket Costs and Prescription Reversals With Oral Linezolid

Associations between out-of-pocket costs and prescription reversals, as well as impact of reversals on rehospitalizations and healthcare costs, were examined among patients prescribed oral linezolid.


To determine the relationship between benefit design, out-of-pocket costs, and prescription reversals, and the impact of reversals on rehospitalizations and total healthcare costs among Medicare members prescribed oral linezolid.

Study Design:

Medicare members from a national health plan prescribed oral linezolid posthospitalization for skin and soft tissue infection (SSTI) or pneumonia were followed retrospectively.


Members were identified by an oral linezolid prescription between June 1, 2007, and April 30, 2011, where the index event was a prescription fill or reversal less than 2 days before or 10 days after discharge. Associations between out-of-pocket costs and reversal, and between reversal and rehospitalization 30 days postindex, were compared for prescription fills versus reversals. A generalized linear model calculated adjusted total healthcare costs per member controlling for age, sex, geographic region, and clinical characteristics.


Reversal rates rose progressively from 2% for members with out-of-pocket costs of $0 to 27% for members with out-of-pocket costs higher than $100 (P <.0001). Infection-related rehospitalizations were 23% versus 9% for members with a prescription reversal versus a fill (P <.0001). While postdischarge prescription drug costs were $1228.78 lower (P <.0001), adjusted mean medical costs were $2061.69 higher (P = .0033) and total healthcare costs were $1280.93 higher (P = .0349) for reversal versus fill members.


Higher out-of-pocket costs were associated with higher rates of reversal, and reversals were associated with higher rates of rehospitalization and adjusted total healthcare costs among Medicare members prescribed oral linezolid posthospitalization for SSTI or pneumonia.

Am J Manag Care. 2013;19(9):734-740High out-of-pocket costs (coinsurance rather than copay) were associated with prescription reversals among Medicare members prescribed oral linezolid after hospitalization for an uncomplicated or complicated skin infection or pneumonia. Also, members with prescription reversals experienced higher rates of rehospitalization and higher total healthcare costs than members with prescription fills.

  • Reversal rates rose from 2% for out-of-pocket costs of $0 to 27% for out-of-pocket costs of more than $100.

  • Infection-related rehospitalizations were 23% for reversal members versus 9% for fill members.

  • Adjusted mean postdischarge healthcare costs were $1280.93 higher for members with reversals than for fill members.

Linezolid is indicated for the treatment of vancomycin-resistant Enterococcus faecium infections, complicated and uncomplicated skin and soft tissue infections (SSTIs), and nosocomial and community-acquired pneumonia (eAppendix available at www.ajmc.com).1 Pathogens for such infections include Staphylococcus aureus (methicillin-susceptible and resistant strains), Streptococcus pneumoniae (including multidrug-resistant strains), Streptococcus pyogenes, and Streptococcus agalactiae. Among these, methicillin-resistant Staphylococcus aureus (MRSA) infections have received particular attention in the 2000s commensurate with evidence indicating a dramatic rise in the rate of MRSA-related hospital admissions.2-4 Whereas more recent studies suggest community-onset and hospital-onset MRSA infections may have tapered and declined somewhat since 2005,5,6 the burden of SSTIs overall remains substantial, and if these infections are not appropriately treated they can result in serious life-threatening consequences.

Among antibiotics used to treat SSTIs and pneumonia, linezolid is available in both intravenous and oral forms. Oral bioavailability is approximately 100%,1 allowing for sequential intravenous to oral administration without changing the drug or dosing regimen. The availability of intravenous and oral forms may allow for a shortened length of hospital stay if treatment is continued orally after discharge, resulting in lower total costs of treating the infection.7 However, due to oral linezolid’s high out-of-pocket costs, patients have been known to decline purchase of (reversals) their prescriptions and receive treatment with an alternative antibiotic or forgo treatment altogether.8

Previous research by Ball and colleagues7 based on Humana Inc health plan members examined whether rehospitalization rates and total healthcare costs increased for members with a prescription reversal versus a fill of oral linezolid. Although members with a claim reversal were rehospitalized at higher rates and had higher medical costs compared with those who had a fill, they did not have higher total healthcare costs than members with a prescription fill for oral linezolid. This implied that oral linezolid and alternative antibiotics or the absence of treatment were similarly cost-effective. However, one limitation of the study by Ball and colleagues was that diagnosis for the initial hospitalization was not confirmed for an infection indicated for linezolid treatment. A second limitation of the study by Ball and colleagues was that members were followed for as long as 60 days postdischarge, which potentially led to inclusion of healthcare utilization and costs unrelated to the initial infection and its consequences.

This research sought to refine the study by Ball and colleagues by restricting the identification of members to those whose initial hospitalization was for complicated or uncomplicated SSTI or pneumonia diagnoses (eAppendix), as well as shortening the postdischarge time period to 30 days to examine acute consequences more likely related to the initial hospitalization. Members from both commercial and Medicare lines of business were initially identified for the study, but all analyses were conducted separately by line of business because of significant differences in plan reimbursement. This study focuses on the Medicare line of business, which comprised a majority (71%) of the total membership.


This study utilized data from Humana’s SAS database which contains enrollment, medical, and pharmacy claims data for Humana’s Medicare membership. All data sources were merged using de-identified member data. The finalized protocol was approved by a central independent institutional review board.

Study Design

We performed a retrospective cohort analysis of all Medicare members identified as having a prescription claim for oral linezolid after discharge from an inpatient stay for complicated or uncomplicated SSTI or pneumonia (eAppendix).Members were identified during the time period of June 1, 2007, to April 30, 2011. The service date of the first linezolid prescription claim was used to identify the date of the index event (fill or reversal). Members who were identified with a reversal in the pharmacy claims but who filled the prescription for oral linezolid within 3 days after the reversal were recategorized as fill members. Members with a claim reversal were compared with those without a reversal in terms of plan design (whether members paid a copay or had coinsurance), member out-of-pocket costs, infection-related (complicated or uncomplicated SSTI or pneumonia) and all-cause rehospitalization (inpatient admission with overnight stay), and healthcare costs (prescription, medical, and total) in the 30 days post discharge.

Study Population

Study subjects were fully insured Medicare Advantage members aged 18 to 89 years who were continuously enrolled for 120 days before and 30 days after the index event (linezolid fill or reversal) and whose index linezolid claim was processed no more than 2 days before or 10 days after hospital discharge. A diagnosis of complicated or uncomplicated SSTI or pneumonia in any position on the inpatient claim was required for the initial hospitalization.

Members were excluded from analysis if they were enrolled as administrative services—only populations (members of employer-funded plans excluded by contract from research), had a claim for pregnancy (International Classification of Diseases, Ninth Revision codes 630.xx-679.xx, V22.xx, and V23.xx), or were in a skilled nursing facility/nursing home any time during the study period.

Statistical Analysis

Claims data for Medicare members prescribed oral linezolid and discharged from an inpatient stay for complicated or uncomplicated SSTI or pneumonia were examined for benefit design, out-of-pocket costs, reversals, rehospitalizations, and healthcare costs. Visual inspection was used to distinguish between copay and coinsurance because the medical claims did not contain an explicit indicator for copay or coinsurance. All integer values (ie, $6, $10, $25, $30, $100, $150) and known noninteger values of Medicare Part D copays (ie, $5.60, $6.30) were classified as copay, while all remaining noninteger values (ie, $57.43, $238.59) were classified as coinsurance. For all descriptive analyses, means were compared using 2-sample t tests and count variables were compared using x2 tests. Demographic and clinical characteristics included age, sex, geographic region, low-income status and dual eligibility (Medicare and Medicaid eligibility), characteristics of the initial broader window typically necessary for medical claims—based comorbidity scores such as the Charlson Comorbidity Index score.14

The impact of the reversal on postindex healthcare costs (plan payment plus member medical cost) was modeled using a generalized linear model (GLM) with a gamma distribution as its probability distribution and log link as its link function. Generalized linear models are commonly utilized to account for distributions of highly skewed data, characteristic of medical expenditures.15 The log link function for the GLM is specified below, where μ refers to postindex healthcare costs:

log u = reversal + Out-of-PocketCategory + age

+ gender + region + LowIncomeSubsidy-DualEligible

+ RxRiskV + ICUstay + surgery + pre-indexhealth

care costs

Covariates included in the model were age, sex, geographic region, low-income subsidy/dual eligibility, baseline RxRisk-V score, a surgical procedure or an intensive care unithospitalization such as surgery or intensive care unit stay, and the RxRisk-V comorbidity score, a surgical procedure or an intensive care unit stay during the initial hospitalization, out-of-pocket costs, and preindex healthcare costs (per $1000). In order to include data on members with no costs during the follow-up period, $1 was added to all member costs. The models provided adjusted mean costs and 95% confidence intervals for the prescription fill and reversal groups.


Table 1

A total 1062 Medicare members were available for analysis. Among the total sample, 16.5% of the members reversed their prescription for oral linezolid. Demographic and clinical characteristics by fill versus reversal groups indicated there were no statistical differences in age, sex, or geographic region (). However, a higher percentage of the members filling their linezolid prescription had low-income subsidy/ dual-eligibility status compared with members reversing their linezolid prescription (P <.0001). A majority of the characteristics of the initial hospitalization were similar, with the exception that a statistically higher percentage of reversal members were hospitalized for complicated or uncomplicated SSTI (P = .0148). That corresponded to a higher percentage of fill members hospitalized for pneumonia (P = .0106). The RxRisk-V comorbidity scores and preindex total healthcare costs were not statistically different between the 2 groups.


The shows that as out-of-pocket costs increased the percentage of members reversing their prescriptions also increased, with out-of-pocket costs above $100 resulting in a reversal rate as high as 27% (P <.0001). It is assumed that patients with out-of-pocket costs of more than $100 were subject to a coinsurance benefit versus a copay for most patients with out-of-pocket costs of less than $100. Mean (standard deviation) out-of-pocket costs for members with a copay were $7.05 ($14.89); for members with coinsurance the mean out-of-pocket cost was $466.52 ($574.67).

Among members who reversed their prescriptions for oral linezolid, 73% filled a prescription for an alternative antibiotic during the 30 days after discharge, while 27% received no antibiotic. Among patients with prescriptions for alternative antibiotics, a small percentage (9%) were treated with oral or parenteral vancomycin, and 0.6% were treated with parenteral tigecycline. Other, more common antibiotics with prescriptions filled during the 30 days after discharge were amoxicillin (10.5%), ciprofloxacin (15.7%), clindamycin (11.0%), doxycycline (10.5%), and levofloxacin (7.0%) (complete list provided upon request).

Table 2

As shown in , infection-related (complicated or uncomplicated SSTI or pneumonia) rehospitalizations were 14 percentage points higher (P <.0001) and all-cause rehospitalizations were 10 percentage points higher (P = .0027) in the reversal group versus the fill group. For each type of infection (complicated or uncomplicated SSTI, pneumonia, or both SSTI and pneumonia), no significant difference was detected between the fill and reversal groups. When grouping prescription fill versus reversal groups by the percentage readmitted for the same infection as the one diagnosed at initial hospitalization, a higher percentage of the reversal group was hospitalized for the same infection: 20% reversal group versus 9% fill group (P <.0001) for complicated or uncomplicated SSTI and 3% reversal group versus 1% fill group (P = .0268) for pneumonia.

Table 3

Unadjusted postindex prescription drug, medical, and total healthcare costs are reported in . Whereas postindex prescription drug costs were significantly lower for members with a reversal (P <.0001), postindex medical costs were significantly higher for these members (P = .0013) compared with members with a fill. The combined total unadjusted healthcare costs were not statistically different between the 2 groups (P = .1853).

Adjusted prescription drug, medical, and total healthcare costs are reported in Table 4. After adjusting for demographic and clinical characteristics, differences in the prescription drug and medical costs remained statistically significant between the fill and reversal groups. Notably, with adjustment, the difference in total healthcare costs between the fill and reversal groups became statistically significant (P = .0349), with the mean healthcare cost for the reversal group being $1280.93 higher than that for the fill group.

Table 5

Parameter estimates (including exponentiated estimates for ease of interpretation) from the GLM for adjusted costs are reported in. The parameter estimate for the reversalvariable was statistically significant, indicating that adjusted costs for members with a reversal were 19.4% higher than those for members with a fill (P = .0349). Male sex was associated with a 20.1% increase in adjusted costs (P = .0027), and an incremental point increase in the RxRisk-V score was associated with a 4.8% increase in adjusted costs (P <.0001). The parameter estimate on preindex healthcare costs was statistically significant, but indicated minimal magnitude. Theparameter estimate for members whose out-of-pocket costs were more than $100 was associated with lower adjusted total healthcare costs (P = .0080). Parameter estimates for the remaining variables examined were not statistically significant.

Several sensitivity analyses further explored the GLM results by varying cutoffs for the out-of-pocket cost categorical variable (above and below $60, above and below $125), as well as including an interaction term between the reversal term and out-of-pocket-cost term. Results (provided upon request) were generally similar to those specified in Table 5.


The current study found that Medicare members with an oral linezolid fill had fewer infection-related and 30-day all-cause hospital readmissions than members who reversed their prescriptions and either did not receive any antibiotic or received a different antibiotic following their reversal. A higher readmission rate, combined with all other types of medical encounters, resulted in higher medical costs during the 30 days after discharge from the initial hospitalization for SSTI or pneumonia. Whereas treatment with oral linezolid was associated with higher postindex prescription drug costs, higher prescription drug costs were offset by lower medical costs for the fill group, resulting in total healthcare costs that were $1280.93 lower for the fill group versus the reversal group. This clearly highlights the need to examine prescription drug costs and benefit design in the context of total healthcare costs.

The fill and reversal groups were similar with respect to the vast majority of their demographic and clinical characteristics, suggesting that an economic perspective might have factored in the decision to fill or reverse the linezolid prescription. Consistent with this interpretation is the significantly higher distribution of low-income subsidy/dual-eligibility status among members with a fill versus members with a reversal (42% vs 10%, respectively). Low-income subsidy/dual-eligible members are more likely to fill the prescription for oral linezolid as it is probable they will have low or no out-of-pocket costs. If economic factors did indeed influence the decision to fill or reverse the linezolid prescription, then strategies to reduce member out-of-pocket costs (eg, benefit design) for all health plan members could enable better member access, and in turn, reduce total healthcare costs.

Among members who reversed their prescriptions for oral linezolid, 27% went untreated and 73% filled prescriptions for alternative antibiotics in the 30 days after discharge. As to whether these other antibiotics could be considered alternative therapies to linezolid from a clinical point of view, the specific infection diagnosis and pathogen for each member, along with the specific antibiotic prescription filled postdischarge, would need to be taken into consideration on a case-by-case basis.

An examination of the literature to date regarding the cost-effectiveness of oral linezolid treatment versus comparators indicates that several formal cost-effectiveness analyses have been conducted (primarily vs vancomycin), with results suggesting linezolid was cost-effective in each of the analyses, particularly in the cases of shorter hospital length of stays.16-20 As pathogens, disease states, additional indications for existing comparators, and emerging new comparators change the clinical and economic landscape of the treatments for SSTIs and pneumonia over time, additional research including cost-effectiveness analyses will need to be conducted.

One limitation of this study was its focus on members with an inpatient stay, which may not be generalizable to those prescribed oral linezolid in an ambulatory setting. In addition, the length of treatment for oral linezolid or other antibiotic therapies was not evaluated in this study and may have had an impact on postdischarge outcomes. Furthermore, the distinction between copay and coinsurance was made via visual inspection due to the fact that the medical claims did not contain an indicator for copay or coinsurance. Future work will need to more accurately reflect the distinction between copay and coinsurance.

Additionally, limitations common to studies using administrative claims data apply. These include lack of certain information in the database (eg, lab results, weight, health behavior information) and errors in claims coding. No causal inference can be ascertained from this study, as it was an observational study using retrospective claims data. Although multivariate regression modeling was used to reduce selection bias and strengthen the causal inference, this approach can only reduce bias caused by measured covariates. Finally, because this study used data from Humana members only, the results may not be generalized to the general population. However, Humana is a large national health plan with members residing in a broad array of US regions.


This study found coinsurance benefit design was linked to higher out-of-pocket costs. These higher costs were associated with increased rates of reversals, which were associated with higher rates of rehospitalization and adjusted total healthcare costs among Medicare members prescribed oral linezolid after hospital discharge for skin or respiratory infections.Author Affiliations: From Comprehensive Health Insights, Inc, (MKP, AML), Louisville, KY; Pfizer Global Biopharmaceuticals (MCD), Pfizer Inc (RBC), New York, NY; Pfizer Inc (SH), Groton, CT.

Funding Source: This research project was funded jointly by Humana Inc and Pfizer Inc. The research concept was approved and plans to publish results were made known prior to commencing the study by the Joint Research Governance Committee of the Humana-Pfizer Research Collaboration, composed of Humana Inc and Pfizer Inc employees.

Author Disclosures: Drs Pasquale and Louder report employment with Comprehensive Health Insights, Inc, a wholly owned subsidiary of Humana Inc, who were paid consultants to Pfizer in connection with the development of this manuscript. Mr Deminski, Mr Chambers, and Ms Haider report employment with Pfizer Inc, as well as stock ownership in the company.

Authorship Information: Concept and design (MKP, AML, MCD, RBC, SH); acquisition of data (AML); analysis and interpretation of data (MKP, AML, MCD, RBC, SH); drafting of the manuscript (MKP, MCD, SH); critical revision of the manuscript for important intellectual content (MKP, MCD, RBC, SH); statistical analysis (AML, RBC); obtaining funding (SH); administrative, technical, or logistic support (MKP); and supervision (SH).

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