Do (More and Better) Drugs Keep People Out of Hospitals?

• Published in: The American economic review Vol. 86; no. 2; pp. 384 - 388
• Main Author: Lichtenberg, Frank R.
• Format: Journal Article
• Language: English
• Published: United States American Economic Association 01.05.1996; American Economic Assoc
• Subjects: 1980-1991; Ambulatory care; Ambulatory health care; Arzneimittel; Death; Drug Utilization - statistics & numerical data; Drugs; Econometrics; Economic theory; Expenditures; Health care; Health Economics; Hospital admissions; Hospital costs; Hospital utilization rate; Hospitalization; Hospitals; Humans; Innovations; Investigational therapies; Krankenhauskosten; Length of Stay - statistics & numerical data; Medicine; Models, Econometric; Mortality; Pharmaceutical preparations; Pharmaceuticals; Physicians; Prescription drugs; Statistical analysis; Studies; Surgical procedures; Surgical Procedures, Operative - statistics & numerical data; Surgical Procedures, Operative - utilization; U.S.A; United States; USA; United States; United States > US
• ISSN: 0002-8282; 1944-7981

The number of hospital bed-days declined most rapidly for those diagnoses with the greatest increase in the total number of drugs prescribed and the greatest change in the distribution of drugs. The estimates imply that an increase of 100 prescriptions is associated with 16.3 fewer hospital days. A $1 increase in pharmaceutical expenditure is associated with a $3.65 reduction in hospital care expenditure (ignoring any direct cost of hospitalization), but it may also be associated with a $1.54 increase in expenditure on ambulatory care. Diagnoses subject to higher rates of surgical innovation exhibited larger increases (or smaller declines) in hospitalization.