Effects of a formulary expansion on the use of atypical antipsychotics and health care services by patients with schizophrenia in the California Medicaid Program

In October 1997, the California Medicaid Program (Medi-Cal) added atypical antipsychotics to its formulary to facilitate the substitution of the atypical antipsychotics for older medications as clinically warranted, especially in minority patients thought to be particularly at risk for poor outcomes using older medications. Moreover, it was expected that the overall use of antipsychotics would increase as patients who experienced sub-optimal outcomes prior to the formulary expansion would again seek treatment once new options were available. The formulary expansion did significantly alter the clinical treatment decision process, resulting in an immediate but temporary increase in the number of patients initiating antipsychotic therapy, many with a recent institutionalization, who restarted drug therapy using the new antipsychotics. There were significant changes in the characteristics of patients using antipsychotic medications. The likelihood of minority patients i.e. African American's gaining access to atypical antipsychotics improved substantially. Persistence on initial antipsychotic decreased and total health care costs increased following open access. However the magnitude of the increase in costs was not uniform across all patient types. Program administrators must use caution when evaluating the impact of unrestricted access on drug therapy outcomes and treatment costs given the changes in the characteristics of patients seeking treatment.