The Impact of Biopharmaceutical Innovation on Disability, Social Security Recipiency, and Use of Medical Care of U.S. Community Residents, 1998–2015

Frank R. Lichtenberg

doi:10.1515/fhep-2021-0050

Artikel

The Impact of Biopharmaceutical Innovation on Disability, Social Security Recipiency, and Use of Medical Care of U.S. Community Residents, 1998–2015

Frank R. Lichtenberg

Veröffentlicht/Copyright: 30. August 2022

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Aus der Zeitschrift Forum for Health Economics and Policy Band 24 Heft 1

Abstract

This study seeks to analyze the overall impact that biopharmaceutical innovation had on disability, Social Security recipiency, and the use of medical services of U.S. community residents during the period 1998–2015. We test the hypothesis that the probability of disability, Social Security recipiency, and medical care utilization associated with a medical condition is inversely related to the number of drug classes previously approved for that condition. We use data from the 1998–2015 waves of the Medical Expenditure Panel Survey and other sources to estimate probit models of an individual’s probability of disability, Social Security recipiency, and medical care utilization. The effect of biopharmaceutical innovation is identified by differences across over 200 medical conditions in the growth in the lagged number of drug classes ever approved. 18 years of previous biopharmaceutical innovation is estimated to have reduced: the number of people who were completely unable to work at a job, do housework, or go to school in 2015 by 4.5%; the number of people with cognitive limitations by 3.2%; the number of people receiving SSI in 2015 by 247 thousand (3.1%); and the number of people receiving Social Security by 984 thousand (2.0%). Previous innovation is also estimated to have caused reductions in home health visits (9.2%), inpatient events (5.7%), missed school days (5.1%), and outpatient events (4.1%). The estimated value in 2015 of some of the reductions in disability, Social Security recipiency, and use of medical care attributable to previous biopharmaceutical innovation ($115 billion) is fairly close to 2015 expenditure on drug classes that were first approved by the FDA during 1989–2006 ($127 billion). However, for a number of reasons, the costs are likely to be lower, and the benefits are likely to be larger, than these figures.

Keywords: biopharmaceutical; innovation; disability; Social Security; medical care

Corresponding author: Frank R. Lichtenberg, Columbia University, New York, USA, E-mail: frl1@columbia.edu

Funding source: U.S. Social Security Administration

Award Identifier / Grant number: NB21-02

Acknowledgment

This research was supported by the Social Security Administration as a project (NB21-02) of the Research and Disability Research Center of the National Bureau of Economic Research.

Appendix A

Figure A1:

Number of WHO ATC4 chemical subgroups ever FDA-approved for 12 diseases, 1995–2015.Source: Author’s calculations based on data in DrugCentral 2021 online drug compendiumand Thériaquedatabase.

Figure A2:

Mean utilization of a drug class N years after first launch, relative to utilization of the drug class 20 years after first launch.

Figure A3:

Effect of disease screening/awareness on measured prevalence and mean severity.

Figure A4:

Distributions of persons and medical conditions by number of medical conditions borne by person, 2015.

Table A1:

Comparison of features of present study of disability in the U.S. to features of previous study of disability in 11 European countries.

	Previous study^a	Present study
2-way fixed effects design	Medical condition and country in a single year (2015)	Medical condition and year in a single country (USA)
Year(s)	2015	1998–2015
Countries	11 European countries	USA
Micro vs. aggregate data	Aggregate	Micro
Ages	50 and over	All ages
Mean age	67.8	35.2
Number of persons	45,592	375,828
Number of conditions	31	216
Number of person-conditions	62,424	1,654,906
Pharmaceutical innovation measure	No. of drugs	No. of drug classes
Person-level disability measures	Yes	Yes
Allow effect of innovation to depend on no. of conditions?	No	Yes
Condition-specific disability measures	No	Yes
Condition-specific healthcare utilization measures	No	Yes

^aLichtenberg FR (2019). The impact of access to prescription drugs on disability in 11 European countries. Disability and Health Journal 12(3): 375–386 (July). https://www.sciencedirect.com/science/article/pii/S1936657419300032.

Table A2:

20 most prevalent ICD-9-CM codes, 2015.

ICD-9-CM	LABEL	UNWEIGHTED	WEIGHTED
	ALL medical conditions	123,227	1,304,448,051
401	ESSENTIAL HYPERTENSION*	6998	70,782,716
272	DIS OF LIPOID METABOLISM*	5264	56,623,122
719	JOINT DISORDER NEC & NOS*	4607	47,528,038
780	GENERAL SYMPTOMS*	4259	42,813,122
460	ACUTE NASOPHARYNGITIS	3573	34,823,002
300	NEUROTIC DISORDERS*	2683	31,451,613
724	BACK DISORDER NEC & NOS*	2576	27,934,066
311	DEPRESSIVE DISORDER NEC	2568	27,251,249
250	DIABETES MELLITUS*	3035	27,198,700
477	ALLERGIC RHINITIS*	2504	24,648,523
493	ASTHMA*	2422	22,238,337
716	ARTHROPATHIES NEC/NOS*	1975	20,464,658
729	OTHER SOFT TISSUE DIS*	1711	16,433,772
786	RESP SYS/OTH CHEST SYMP*	1820	16,347,247
959	INJURY NEC/NOS*	1611	16,345,147
473	CHRONIC SINUSITIS*	1227	15,950,107
715	OSTEOARTHROSIS ET AL*	1349	15,887,094
V68	ADMINISTRATIVE ENCOUNTER*	1320	14,425,007
782	SKIN/OTH INTEGUMENT SYMP*	1301	13,523,776
414	OTH CHR ISCHEMIC HRT DIS*	1046	11,513,206

https://www.meps.ahrq.gov/data_stats/download_data/pufs/h180/h180app2.html. NOTE: ‘*’ indicates collapsing of fully specified codes to 3-digit code categories.

Table A3:

Estimates of β _mid,k and β _high,k (from eq. (3)) from models of 10 person-level disability and Social Security recipiency measures.

Row	lag (k)	β _mid,k				β _high,k
Row	lag (k)	Coef.	Std. Err.	z	P > \|z\|	Coef.	Std. Err.	z	P > \|z\|
	A. Has any limitation
1	0	−0.072	0.096	−0.75	0.46	−0.076	0.096	−0.79	0.43
2	3	−0.073	0.076	−0.97	0.33	−0.077	0.076	−1.01	0.31
3	6	−0.089	0.044	−2.03	0.04	−0.092	0.044	−2.11	0.04
4	9	−0.079	0.037	−2.14	0.03	−0.082	0.036	−2.27	0.02
5	12	−0.047	0.039	−1.21	0.23	−0.051	0.039	−1.32	0.19
6	15	0.000	0.040	0.01	1.00	−0.004	0.040	−0.11	0.92

	B. Has any limitation work/housework/school
7	0	−0.102	0.102	−1.00	0.32	−0.060	0.100	−0.60	0.55
8	3	−0.127	0.066	−1.93	0.05	−0.085	0.064	−1.32	0.19
9	6	−0.094	0.041	−2.30	0.02	−0.051	0.040	−1.29	0.20
10	9	−0.074	0.031	−2.40	0.02	−0.031	0.030	−1.03	0.30
11	12	−0.044	0.035	−1.26	0.21	−0.001	0.035	−0.04	0.97
12	15	−0.008	0.037	−0.22	0.83	0.034	0.037	0.93	0.35

	C. Has limitation in physical functioning
13	0	−0.092	0.096	−0.96	0.34	−0.064	0.095	−0.68	0.50
14	3	−0.093	0.062	−1.49	0.14	−0.064	0.061	−1.05	0.29
15	6	−0.089	0.033	−2.70	0.01	−0.060	0.033	−1.84	0.07
16	9	−0.052	0.025	−2.04	0.04	−0.024	0.025	−0.93	0.35
17	12	−0.033	0.029	−1.14	0.26	−0.005	0.029	−0.19	0.85
18	15	0.008	0.035	0.22	0.83	0.035	0.035	1.01	0.31

	D. Has cognitive limitations
19	0	−0.125	0.099	−1.26	0.21	−0.089	0.098	−0.91	0.36
20	3	−0.127	0.063	−2.02	0.04	−0.090	0.061	−1.48	0.14
21	6	−0.113	0.041	−2.73	0.01	−0.076	0.040	−1.88	0.06
22	9	−0.096	0.035	−2.71	0.01	−0.058	0.035	−1.67	0.09
23	12	−0.070	0.038	−1.85	0.07	−0.033	0.037	−0.88	0.38
24	15	−0.044	0.032	−1.37	0.17	−0.006	0.031	−0.20	0.84

	E. In fair or poor health
25	0	−0.127	0.105	−1.21	0.23	−0.107	0.103	−1.04	0.30
26	3	−0.135	0.065	−2.07	0.04	−0.115	0.063	−1.83	0.07
27	6	−0.104	0.053	−1.95	0.05	−0.084	0.052	−1.61	0.11
28	9	−0.080	0.052	−1.55	0.12	−0.061	0.051	−1.19	0.24
29	12	−0.044	0.052	−0.84	0.40	−0.024	0.051	−0.47	0.64
30	15	−0.034	0.039	−0.87	0.39	−0.015	0.039	−0.37	0.71

	F. Unable to work
31	0	−0.113	0.125	−0.90	0.37	−0.052	0.123	−0.42	0.67
32	3	−0.158	0.079	−2.00	0.05	−0.096	0.077	−1.25	0.21
33	6	−0.133	0.041	−3.28	0.00	−0.071	0.040	−1.79	0.07
34	9	−0.118	0.035	−3.36	0.00	−0.056	0.035	−1.61	0.11
35	12	−0.071	0.039	−1.83	0.07	−0.009	0.038	−0.24	0.81
36	15	−0.025	0.041	−0.61	0.54	0.037	0.040	0.93	0.35

	G. Completely unable to do activity
37	0	−0.155	0.103	−1.51	0.13	−0.110	0.101	−1.09	0.27
38	3	−0.178	0.055	−3.24	0.00	−0.133	0.053	−2.49	0.01
39	6	−0.114	0.040	−2.85	0.00	−0.069	0.040	−1.75	0.08
40	9	−0.092	0.033	−2.79	0.01	−0.046	0.032	−1.43	0.15
41	12	−0.059	0.035	−1.65	0.10	−0.013	0.035	−0.38	0.71
42	15	−0.027	0.036	−0.75	0.45	0.018	0.036	0.51	0.61

	H. Receives SSI
43	0	−0.063	0.075	−0.84	0.40	−0.032	0.073	−0.43	0.67
44	3	−0.061	0.052	−1.17	0.24	−0.030	0.051	−0.59	0.56
45	6	−0.076	0.039	−1.95	0.05	−0.044	0.039	−1.15	0.25
46	9	−0.074	0.031	−2.40	0.02	−0.042	0.030	−1.40	0.16
47	12	−0.011	0.036	−0.30	0.77	0.021	0.036	0.59	0.56
48	15	0.002	0.037	0.06	0.95	0.034	0.037	0.92	0.36

	I. Receives Social Security
49	0	−0.025	0.063	−0.40	0.69	−0.006	0.061	−0.09	0.93
50	3	−0.045	0.046	−0.98	0.33	−0.025	0.044	−0.56	0.58
51	6	−0.080	0.026	−3.06	0.00	−0.060	0.026	−2.35	0.02
52	9	−0.062	0.022	−2.74	0.01	−0.041	0.022	−1.85	0.06
53	12	−0.057	0.020	−2.91	0.00	−0.037	0.020	−1.89	0.06
54	15	−0.022	0.021	−1.03	0.30	−0.001	0.021	−0.07	0.94

	J. Is retired
55	0	0.072	0.030	2.41	0.02	0.073	0.030	2.45	0.01
56	3	0.087	0.030	2.90	0.00	0.088	0.030	2.95	0.00
57	6	0.018	0.025	0.73	0.46	0.019	0.025	0.76	0.45
58	9	0.006	0.022	0.25	0.80	0.006	0.022	0.27	0.78
59	12	0.001	0.020	0.05	0.96	0.002	0.020	0.08	0.94
60	15	0.003	0.022	0.13	0.90	0.003	0.022	0.15	0.88

Table A4:

Estimates of the reduction in disability, Social Security recipiency, and medical care utilization in 2015 attributable to previous pharmaceutical innovation.

Row	Person-level measure	lag (k)	β _k			∆mean[ln (CUM_CLASS_k)]	Ŷ _actual,2015	Ŷ _{no_innov,2015}	(Ŷ _{no_innov,2015}/Ŷ _actual,2015) − 1	Actual prevalence (no. of people) in 2015	Reduction in 2015 prevalence due to previous innovation
Row	Person-level measure	lag (k)	Coef.	z	P > \|z\|	∆mean[ln (CUM_CLASS_k)]	Ŷ _actual,2015	Ŷ _{no_innov,2015}	(Ŷ _{no_innov,2015}/Ŷ _actual,2015) − 1	Actual prevalence (no. of people) in 2015	Reduction in 2015 prevalence due to previous innovation
1	A. Has any limitation	9	−0.101	−2.89	0.00	0.188	46.1%	46.9%	1.6%	66,518,606	1,087,194
2	B. Has any limitation work/housework/school	9	−0.088	−3.21	0.00	0.188	23.9%	24.4%	2.2%	26,114,266	565,599
3	C. Has limitation in physical functioning	6	−0.108	−3.48	0.00	0.182	29.6%	30.3%	2.3%	35,065,504	807,263
4	D. Has cognitive limitations	9	−0.103	−3.23	0.00	0.188	13.1%	13.5%	3.2%	14,286,436	453,913
5	E. In fair or poor health	3	−0.158	−2.66	0.01	0.149	27.9%	28.7%	2.9%	35,023,619	1,003,716
6	F. Unable to work	9	−0.127	−4.06	0.00	0.188	13.1%	13.6%	3.9%	13,069,508	512,337
7	G. Completely unable to work at a job, do housework, or go to school	3	−0.193	−4.13	0.00	0.149	15.8%	16.5%	4.5%	16,066,307	717,536
8	H. Receives SSI	9	−0.087	−3.15	0.00	0.188	7.5%	7.8%	3.1%	7,962,496	247,239
9	I. Receives Social Security	12	−0.070	−3.73	0.00	0.244	30.8%	31.4%	2.0%	50,188,176	984,418
10	J. Is retired	3	0.080	2.74	0.01	0.149	16.2%	15.9%	−1.8%	29,061,321	−523,648
	Condition-specific measure									Actual prevalence (no. of conditions) in 2012 or 2015	Reduction in 2012 or 2015 prevalence due to previous innovation
11	A. Any bed days?	6	−0.182	−3.11	0.00	0.182	12.2%	12.9%	5.6%	134,426,738	7,564,874
12	B. Any missed school days?	0	−0.240	−3.26	0.00	0.107	6.5%	6.8%	5.1%	64,262,316	3,287,568
13	C. Any missed work days?	0	−0.128	−2.16	0.03	0.107	9.8%	10.0%	2.5%	118,108,129	2,895,970
14	D. Any prescribed medicines?	6	0.150	2.12	0.03	0.182	52.5%	51.4%	−2.1%	672,272,630	−13,924,430
15	F. Any emergency room visits?	0	−0.103	−3.22	0.00	0.107	5.5%	5.6%	2.3%	65,246,840	1,475,112
16	G. Any home health visits?	6	−0.204	−4.78	0.00	0.182	2.3%	2.5%	9.2%	24,957,855	2,286,640
17	H. Any inpatient events?	3	−0.159	−3.19	0.00	0.149	2.5%	2.6%	5.7%	32,072,297	1,820,489
18	I. Any outpatient events?	12	−0.079	−2.74	0.01	0.244	4.9%	5.1%	4.1%	70,561,790	2,857,771

Ŷ _{no_innov,2015} = Φ[Φ⁻¹(Ŷ _actual,2015) − β _k * (mean(ln(CUM_CLASS_2015-k)) − mean(ln(CUM_CLASS_1997-k)))]. Estimates in bold are statistically significant (p-value < 0.05).

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Received: 2021-09-28

Accepted: 2022-07-18

Published Online: 2022-08-30

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Frontmatter
Articles
Utilization Management in the Medicare Part D Program and Prescription Drug Utilization
The Impact of Biopharmaceutical Innovation on Disability, Social Security Recipiency, and Use of Medical Care of U.S. Community Residents, 1998–2015

https://doi.org/10.1515/fhep-2021-0050

Schlagwörter für diesen Artikel

biopharmaceutical; innovation; disability; Social Security; medical care

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