A non-trivial fraction of people cannot afford to buy pharmaceutical products at unregulated market prices. Therefore, the paper analyzes the public insurance of the pharmaceutical products in terms of price controls and the socially optimal third-degree price discrimination. It characterizes...

In 1991 a most-favored-customer (MFC) rule was adopted to govern pharmaceutical prices paid by Medicaid. Theoretical models show that an MFC rule commits a firm to compete less aggressively in prices. I find that the price of branded products facing generic competition rose (4% on average)....

Hepatitis C is a major public health concern due to its high rates of infection and mortality. Recent breakthroughs in pharmaceuticals not only have the potential to cure hepatitis C but could also cause large positive health externalities through reduced transmission. The high cost of these...

Insurers subcontract with pharmacy benefit managers (PBMs) to administer drug insurance. PBMs typically profit from the difference between a fixed amount and the reimbursement paid to pharmacies (i.e., "spread pricing"). Some states require insurers and PBMs to use cost-plus contracts, in which...

In early 2004, the U.S. Government initiated the Medicare Discount Drug Card Program, which created a market for drug cards that allowed their subscribers to obtain discounts on their prescription drug purchases. Pharmacy-level prices for several drugs were posted on the program website weekly...

The Affordable Care Act included a provision to eliminate the Medicare prescription drug coverage gap. The policy was phased in by gradually diminishing the gap each year between 2011-2020. This provides a natural experiment to conduct an in-depth study of how the policy affected medication use,...

Medical providers' profit considerations might take priority over their patients' needs in Taiwan because they are allowed to both dispense and prescribe medications. I examine this problem in the demand of the anti-diabetic drugs market using information from millions of claims. Empirical...

Subsidized health insurance markets use diagnosis-based risk adjustment to induce insurers to offer an equitable benefit to individuals of varying expected cost. I demonstrate that technological change after risk adjustment calibration -- new drug entry and the onset of generic competition --...

Despite promises that Medicare would not interfere with patients' ability to choose their physician and to purchase additional health coverage on the open market, over the decades Medicare rules and regulations have gradually eroded senior citizens' ability to control their healthcare choices....

In early 2004, the U.S. Government initiated the Medicare Discount Drug Card Program, under which a large amount of pharmacy-level price data pertaining to over 800 drugs has been released weekly on the Medicare Web site continuously between May 29, 2004 and October 2005. This extensive...