News Release

Argentina's largest health system works to lower drug costs

Peer-Reviewed Publication

Pan American Health Organization

Argentina is the testing ground for what is believed to be the world's first experiment of its kind to both cope with rising drugs costs and also improve services to senior citizens and disabled persons, two of the country's most vulnerable population groups.

The National Institute of Social Services for Retirees and Pensioners (NISSRP) ("Instituto Nacional de Servicios Sociales para Jubilados y Pensionados") is Argentina's single largest health system. Among other services, the NISSRP provides outpatient drug coverage and cancer treatment medications to its more than 3.3 million beneficiaries, including retired workers, pensioners with a disability such as a physical or mental disorder, war veterans, and the dependents of these beneficiaries.

As rising prices for prescription medications began to take their toll on both the NISSRP and its beneficiaries, through the beneficiaries' copayment obligations, the NISSRP turned its attention to the country's drug companies. Aware of the economic clout of this group, in 1997 the NISSRP approached the pharmaceutical industry and successfully negotiated an agreement with a consortium of more than 200 enterprises to transfer to them the risk of increasing pharmaceutical costs in exchange for a fixed monthly payment by the NISSRP.

Argentina is believed to be the first nation in the world to ever test this type of risk contract as a way to control drug expenditures. The preliminary results of this experiment--a comparative analysis of NISSRP beneficiaries' consumption trends in 1996, before the agreement went into effect, with those for 1999, two years following the arrangement's initiation--are featured in an English-language article in the April 2003 issue of the "Revista Panamericana de Salud Pública/Pan American Journal of Public Health," a journal published by the Pan American Health Organization (PAHO). (The article can be viewed for free on the PAHO Web site (http://www.paho.org) by searching for the term "Argentina drug costs.")

The study was conducted by a multidisciplary team of eight researchers from the NISSRP and the University of Buenos Aires' School of Medicine. The lead author of the article, Juan C. Cervellino, is affiliated with the NISSRP. The "Revista/Journal" article describes the study's design and principal findings, followed by a comprehensive discussion of the theoretical and practical advantages and pitfalls emanating from the agreement. The authors caution that while an initiative of this sort holds promise, it also "requires extensive mechanisms for control, follow-up, and updating" of approved medications, and "it also risks making nonrational drug prescribing [drug prescribing that does not follow well-recognized standards] the accepted rule." The findings, while based on a relatively limited time frame, nonetheless provide important insight into a dilemma governments around the world currently face: how to contain health care costs while at the same time providing quality services to the population segments that most need them.

###

The "Revista Panamericana de Salud Pública/Pan American Journal of Public Health" is the main scientific and technical periodical published by PAHO and features research conducted in the Region of the Americas. PAHO, which also serves as the Regional Office for the Americas of the World Health Organization, was established in 1902. PAHO Member States include all 35 countries in the Americas. Puerto Rico is an Associate Member. France, the Kingdom of the Netherlands, and the United Kingdom of Great Britain and Northern Ireland are Participating States, and Portugal and Spain are Observer States.


Disclaimer: AAAS and EurekAlert! are not responsible for the accuracy of news releases posted to EurekAlert! by contributing institutions or for the use of any information through the EurekAlert system.