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Background: Germany has the highest per capita health care spending among EU member states, but its hospitals face pressure to generate profits independently due to the government's withdrawal of investment cost coverage. The diagnosis related groups (DRG) payment system was implemented to address the cost issue, challenging hospital physicians to provide services within predefined prices and an economic target corridor to reduce costs. This study examines the extent of cost awareness among medical personnel in German hospitals and its influencing factors. Methods: We developed an online survey in which participants across all specialties in hospitals estimated the prices in euros of four common interventions and answered questions about their human capital and perceived stress on the workplace. As a measure of cost awareness, we used the probability of estimating the prices correctly within a reasonable margin. We employed logit logistic regression estimators to identify influencing factors in a sample of 86 participants. Results: The results revealed that most of the respondents were unaware of the costs of common interventions. General human capital, acquired through prior education, and job-specific human capital had no influence on cost awareness, whereas domain-specific human capital, that is, gaining economic knowledge based on self-interest, had a positive nonlinear effect on cost awareness. Furthermore, an increased stress level negatively influenced cost awareness. Conclusions: This paper is the first of its kind for the German health care sector that contributes responses to the question whether health care professionals in German hospitals have cost awareness and if not, what reasons lie behind this lack of knowledge. Our findings show that the cost awareness desired by the introduction of the DRG system has yet to be achieved by medical personnel. [ABSTRACT FROM AUTHOR]

This paper focuses on HTA, pricing and reimbursement of pharmaceuticals in Germany and Poland. The authors analyzed processes of decision making related to pharmaceutical reimbursement, as well as their transparency. Both Germany and Poland have developed complex processes of pharmaceutical pricing and reimbursement, as well as incorporated HTA into decision making procedures. In Germany the stakeholders involvement and transparency of processes seem to be to higher than in Poland. [ABSTRACT FROM AUTHOR]

In Germany, the Institute for Quality and Efficiency in Health Care (IQWiG) makes recommendations for ceiling prices of drugs based on an evaluation of the relationship between costs and effectiveness. To set ceiling prices, IQWiG uses the following decision rule: the incremental cost-effectiveness ratio of a new drug compared with the next effective intervention should not be higher than that of the next effective intervention compared to its comparator. The purpose of this paper is to show that IQWiG's decision rule can be presented as a cost-per-QALY rule by using equity-weighted QALYs. This transformation shows where both rules share commonalities. Furthermore, it makes the underlying ethical implications of IQWiG's decision rule transparent and open to debate. [ABSTRACT FROM AUTHOR]

Background: Based on the legal framework laid down in section 130b (9) of Book V of the German Social Code, various criteria are relevant for the negotiated price for new patented drugs in Germany. European reference prices (ERPs) are one criterion. The ERP is based on the ex-factory prices (EFPs) of the countries included in the European country basket. However, in some of these countries, the EFP is not published due to confidential wholesale margins. Wholesale margins must therefore be estimated and deducted from purchase prices. In this context literature-based estimates to date do not assume regressive margins with higher pharmaceutical prices. This assumption is questionable and can lead to systematically underestimated country prices, especially for high-priced drugs. Percentage wholesale margins in the majority of European countries develop to a comparable extent regressively with increasing prices. It should therefore be examined (1) whether statistical models can predict the margins of individual countries, in principle and especially for countries where margins are unknown and regressive trends are likely, and (2) to what extent the estimation of margins improves when regressive statistical models are used to estimate margins instead of cross-price averages published in the literature. Methods: Qualitative preliminary research explores the basic wholesale pricing mechanisms in countries with confidential wholesale margins. Wholesale margins for reimbursable drugs were then modeled for regulated European countries. Estimation quality and impact of the model was compared to estimations based on average margins. Results: In both regulated countries and in countries with confidential wholesale margins, percentage margins of wholesalers develop regressively as drug prices rise. Regressive courses of margins can be resiliently modeled for the regulated countries using a power distribution with significantly lower mean squared errors in a linear mixed model in comparison to literature-based estimations with country-specific cross-price averages. Conclusion: If there is reason to believe that margins are regressive, confidential wholesale margins are expected to be better estimated by the power function based on margins of regulated countries than by the published country-specific average margins, reducing significantly inaccurate effects on margin estimations of high-price drugs. [ABSTRACT FROM AUTHOR]

Purpose – In Germany, the Institute for Quality and Efficiency in Health Care (Institut für Qualität und Wirtschaftlichkeit im Gesundheitswesen (IQWiG)) makes recommendations for reimbursement prices of drugs based on an evaluation of the relationship between incremental costs and effects. In 2009, the German government (“Koalitionsvertrag”) announced its intention to evaluate the transparency and acceptability of IQWiG's work. The purpose of this paper is to conduct a survey of a sample of the German population: to check the acceptance of the IQWiG's decision rule compared to a decision rule used in countries such as England and Wales; and to test if the way the IQWiG's decision rule is presented affects its acceptance. Design/methodology/approach – A questionnaire was developed eliciting acceptability of IQWiG's decision rule and a single cost-effectiveness threshold applying to all diseases (i.e. absolute rule (AR)). To check for a framing effect IQWiG's decision rule was presented in two ways. One version presented it, based on IQWiG's official publication, as a constant ratio between incremental costs and effects within a therapeutic area (proportional rule (PR), Version 1). The other version presented it in terms of a proportional relationship between costs and effects within a therapeutic area (PR, Version 2). χ2 goodness of fit test and two-proportion z-test tested for differences between acceptance rates of decision rules. Findings – A sample of 108 persons from the general public (average age: 41 years, 48 per cent male) filled out the questionnaire. Acceptance rates for AR, PR Version 1, and PR Version 2 were 33, 48, and 39 per cent, respectively. Direct comparisons show that acceptance of PR Version 1 was significantly higher than acceptance of AR (p=0.026) and that there was a clear trend towards higher acceptance of PR Version 1 compared to Version 2 (p=0.22). The difference between PR Version 2 and AR was not significant (p=0.32). Research limitations/implications – In our study, different presentations of the IQWiG decision rule did not significantly alter its acceptance, although there was a clear trend towards accepting IQWiG's official version. Furthermore, the acceptance of the IQWiG's official version was significantly higher than AR. Because of the relevance of the research question we recommend additional research for confirmation and explanation of the choices made. Originality/value – This is one of the few studies on the impact of framing on allocation preferences in health care. [ABSTRACT FROM AUTHOR]

In response to rapidly rising pharmaceutical costs, many countries have introduced health technology assessment (HTA) as a 'fourth hurdle'. We evaluated the causal effect of HTA based regulation on access to pharmaceuticals by using the introduction of Germany's HTA system (AMNOG) in 2011. We obtained launch data on pharmaceuticals for 30 European countries from the IQVIA (formerly IMS) database. Using difference-in-difference models, we estimated the effect of AMNOG on launch delay, the ranking order of launch delays and the availability of pharmaceuticals. We then compared the results for Germany to Austria, Czechia, Italy, Portugal and the UK. Across all six countries, launch delay decreased from the pre-AMNOG period (25.01 months) to the post-AMNOG period (14.34 months). However, the introduction of AMNOG consistently reduced the magnitude of the decrease in launch delay in Germany compared to the comparator countries (staggered DiD: + 4.31 months, p = 0.05). Our logit results indicate that the availability of pharmaceuticals in Germany increased as a result of AMNOG (staggered logit: + 5.78%, p = 0.009). We provide evidence on the trade-off between regulation and access. This can help policymakers make better informed decisions to strike the right balance between cost savings achieved through HTA based regulation and access to pharmaceuticals. [ABSTRACT FROM AUTHOR]

Health insurance companies curb price-insensitive behavior and the moral hazard of insureds by means of cost-sharing, such as tiered co-payments or reference pricing in drug markets. This paper evaluates the effect of price limits - below which drugs are exempt from co-payments - on prices and on demand. First, using a difference-in-differences estimation strategy, we find that the new policy decreases prices by 5 percent for generics and increases prices by 4 percent for brand-name drugs in the German reference price market. Second, estimating a nested-logit demand model, we show that consumers appreciate co-payment exempt drugs and calculate lower price elasticities for brand-name drugs than for generics. This explains the different price responses of brand-name and generic drugs and shows that price-related co-payment tiers are an effective tool to steer demand to low-priced drugs. [ABSTRACT FROM AUTHOR]

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Background: Pharmaceutical spending has been increasing rapidly for years and is higher than ever before. To control the rising costs, countries are implementing regulatory frameworks such as (internal) reference pricing, price cuts or generics substitution. Internal reference pricing establishes a reference price within a country which serves as the maximum level of reimbursement for a group of pharmaceuticals. Price setting in the German market is especially relevant for many European countries, which use Germany as a reference country for their own price setting. Methods: We evaluate pharmaceutical price dynamics for not reference priced pharmaceuticals (NRPs) as well as for reference priced pharmaceuticals (RPs) in Germany—referring to the internal reference price system. 64,862 medication packs have been extracted from the German pharmaceutical pricing register Lauer-Taxe. For each pack, we extracted detailed data on the company, manufacturer rebates, pharmacy retail prices, reference prices, co-payments, import quotas, and discount agreements. We then investigated price setting and dynamics of NRPs vs. RPs for all 14 indication areas by ATC code level 1. Results: The average manufacturer price per pack was 604.84€ for NRPs and 112.11€ for RPs. Similar differences were found for the wholesale price and the pharmacy retail price. The reference price was—as expected—0.00€ for NRPs, and 154.40€ for RPs. NRP packs were imported in 42.38%, while RP packs were imported only in 24.62%. Highest average pharmacy retail prices could be found in the therapeutic areas 'antineoplastic and immunomodulating agents' (1711.47€), 'systemic hormonal preparations' (1331.95€), and 'blood and blood forming organs' (1260.58€). We detected high fluctuations in pharmacy retail prices per indication, as well as for reference prices per indication. The indications with the highest number of reference price regulated medical packs are 'cardiovascular system', 'musculo-skeletal system', and 'nervous system'. Highest co-payments were found in the indications 'antineoplastic and immunomodulating agents', 'blood and blood forming organs', and 'antiinfectives for systemic use'. Conclusion: Price setting and price dynamics vary substantially between NRP and RP medication packs. Further, we saw major differences across all indication areas as well as when comparing medication packs launched by top 20 pharma companies vs. the rest. [ABSTRACT FROM AUTHOR]

Background and Objective: Legislation introduced in 2011 in Germany has instituted an early benefit assessment of newly licensed pharmaceuticals with a subsequent price negotiation. For orphan drugs (ODs) a special legal framework applies, which accounts for the fact that ODs do not have to prove an added benefit over an appropriate comparative therapy previously determined by the decision maker. As, in addition, the content of negotiations between pharmaceutical companies and the payer is confidential, the aim of this study was to identify factors influencing the negotiated prices of ODs.Methods: Twelve hypotheses on factors influencing the negotiated OD price were derived based on the existing literature and framework agreement between payers and pharmaceutical unions according to German social legislation. Univariate analyses were applied to detect statistically significant correlations between annual therapeutic costs of ODs and the hypothesized factors. Bivariate analyses were used to determine confounding factors. In addition, a multiple ordinary least squares (OLS) regression with backward selection was conducted. Finally, sensitivity analyses assessed the robustness of the results.Results: Thirty-five ODs were included in the analysis. The univariate analyses and subsequent sensitivity analyses validated five of the 12 hypotheses formulated. Univariate analyses suggest a statistically significant association between the OD price and the (i) therapeutic area; (ii) approval for pediatric care; (iii) treatment population size; (iv) cost of comparative therapies; and (v) European prices. The OLS regression identified European prices as the variable with the strongest association with the negotiated prices.Conclusion: We show that German OD pricing is a multivariate phenomenon. However, due to interdependencies, these results must be treated with caution. [ABSTRACT FROM AUTHOR]

Background: Since 2011, an early benefit assessment (EBA) of new drugs constricts free price setting in Germany. According to the Pharmaceutical Market Restructuring Act (AMNOG), pharmaceutical companies are obliged to demonstrate added benefit of new drugs over comparative treatment. Benefit is usually evaluated by the Institute for Quality and Efficiency in Health Care (IQWiG). The final appraisal is made by the Federal Joint Committee, Germany's highest-ranking decision body in the health sector, triggering drug prize negotiations between companies and statutory health insurance funds. One of four evaluation criteria is quality of life (QoL). QoL outcomes have, however, only rarely been pivotal in EBAs.Objective: This study determined methodological requirements for QoL measurement and data presentation in the EBA.Design: In a qualitative content analysis, documents of all EBAs completed by 2014 were searched for the term QoL. Relevant passages of all EBAs of 2011-2013 were independently extracted and reduced to key content by two researchers. Recurring patterns were identified and verified through comparison with EBAs of 2014.Results: We identified a range of requirements regarding QoL assessment, analysis, presentation, and interpretation, which go beyond official regulations. Disease-specific questionnaires are preferred and have to be validated according to certain standards and in the respective patient group. Effects must exceed the minimal important difference, which in turn must be validated in compliance with specific requirements. Often, instruments were not accepted as QoL measures, sometimes inconsistently across EBAs. Another frequent reason for non-acceptance of QoL data was that more than 30 % of randomized patients could not be analyzed due to missing data.Conclusions: Non-compliance with methodological requirements for QoL evidence impairs chances for positive benefit evaluation. [ABSTRACT FROM AUTHOR]

Purpose: In 2011, Germany introduced a new form of drug benefit assessment, linking reimbursement prices to drug benefit and making quality of life (QoL) one of the main benefit criteria. Thus, QoL outcomes co-determine drug prices in Germany. QoL has, however, not been defined in the regulations. This study analyzed the definition and role of QoL in Germany's drug benefit assessment. It serves as a case study on the complexity of QoL as a parameter of health technology and drug assessments, which have become mandatory in almost all industrialized countries.Methods: In a qualitative analysis, the publicly available dossiers (summaries), dossier evaluations, protocols of the oral hearings, the final resolutions of the Federal Joint Committee (G-BA) and its rationale of all benefit assessments completed by 2013 (n = 66) were processed. Additionally, quantitative data on the decision outcomes were collected.Results: Only two decisions drew on QoL outcomes as "main justifications" for additional benefit. It was due to a lack of valid and statistically significant QoL results, a deficient presentation of QoL data, or differing understandings of QoL, that QoL benefit was not demonstrated in more than two cases. While manufacturers applied wider definitions of QoL, the assessment institutions questioned evidence if it was not reported with the help of validated QoL questionnaires or deviated from their definition of QoL.Conclusions: The German experience with QoL as a drug benefit criterion highlights the importance of a clear QoL definition and according methodological regulations. [ABSTRACT FROM AUTHOR]

Objective The reliability of general self-rated health status is examined using the reform of the public health insurance system of Germany in 2004 as a source of exogenous variation. The reform introduced a co-payment for ambulatory doctor visits and increased the co-payments for prescription drugs. Methods This natural experiment allows identification of the causal impact of the program on self-assessed health (SAH). A difference-in-differences estimator is applied to estimate the effect of the reform on SAH. Results Using data from the German Socio-Economic Panel, the results indicate that the reform improved the treatment group's average SAH even when there was no discernible impact on actual health. Conclusion The exercise reveals the sensitivity of SAH to a perturbation in the insurance system. More objective measures of health may be needed to acquire an accurate assessment of general health when the health system is in flux. [ABSTRACT FROM AUTHOR]