Measuring the Willingness-to-pay for standardizing medication information: a two-pronged stated preference approach

ABSTRACT

When patients lack information about their medications, they are more likely to experience adverse events that may have costly health outcomes. One possible approach for improving the information that patients receive about their medications is to standardize the written information that pharmacies provide so that it is uniform and easier to read. While patients have expressed a preference for this standardization, no previous study has provided nationally representative estimates of its monetary benefits. In this paper, we estimate willingness to pay (WTP) to measure the potential benefits of standardizing the medication information leaflets that pharmacies provide to patients. We use data collected from an online, nationally representative, stated preference survey administered to non-institutionalized adults age 18 and over in the United States. Survey respondents were randomized to receive either open-ended valuation questions or referendum-style valuation questions. Responses from the open-ended questions suggest a mean WTP between approximately $3 and $13 per year depending on the treatment of outliers. Regression results suggest that those who received the referendum-style questions would be willing to pay, on average, just under $7 per year for the standardization.

KEYWORDS:

• Willingness to pay
• contingent valuation
• information
• prescription drugs

JEL CLASSIFICATION:

• I12
• C42
• I18

Acknowledgements

The authors would like to thank Elizabeth Quin for her comments and suggestions and the staff from FDA’s Office of Medical Policy in the Center for Drug Evaluation and Research for their help in developing the survey and the sample leaflets. We would also like to thank Nellie Lew and Clark Nardinelli for their guidance during the pilot round of this survey.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

¹ For more details on Ipsos’ KnowledgePanel see their website https://www.ipsos.com/en-us/solutions/public-affairs/knowledgepanel.

² The Human Subject Protection Executive Officer determined that this study does not require FDA IRB review and approval because it is exempt from the requirements of 45 CFR Part 46; 45 CFR 46.104(d)(2)(i).

³ We recalculate the survey weights after adjusting the sample for protest zeros and use these recalculated weights throughout our sensitivity analysis.

⁴ Survey weights were calculated for each arm using iterative proportional ranking. Each arm’s sample was weighted to match the 18-and-over US population estimates from the March 2019 Current Population Survey with respect to gender, race/ethnicity, US Census region by Metropolitan area, education, and household income.