In this project we will estimate the welfare effects of oncology drug shortages on patients. In particular, we will study the effects of shortages on utilization of substitute drugs, treatment gaps, and dosage changes. In addition, we will analyze the effects on hospitalizations, disease progression, mortality and length of life as well as both out-of-pocket and total health care spending.
Since 2006, the U.S. has experienced a marked increase in the number of prescription drug shortages- with sterile injectable drugs, like oncology drugs, accounting for more than 70% of these shortages in 2011 (ASPE 2011). Many of the drugs affected by shortages have few close substitutes. Shortages of these drugs can foster suboptimal treatment redesigns with potentially life-threatening consequences (Mello et al 2005;Jensen et al. 2010;GAO 2011). However, there are no studies that systematically or quantitatively analyze the consequences of shortages nationwide. This study will estimate the welfare effects of sterile injectable oncology drug shortages on cancer patients using Medicare claims data. In particular, we will study the effects of shortages on treatment patterns (utilizatin of substitute drugs, treatment gaps, and dosage changes), health outcomes, and health care spending.