OBJECTIVE: To identify economic and organizational characteristics that affect the likelihood that health maintenance organizations (HMOs) include new drugs on their formularies. DATA SOURCES: We administered an original survey to directors of pharmacy at 75 HMOs, of which 41 returned usable responses. We obtained drug-specific data from an industry trade journal. STUDY DESIGN: We performed multivariate logistic regression analysis, adjusting for fixed-drug effects and random-HMO effects. We used factor analysis to limit the number of predictors. DATA COLLECTION METHODS: We held initial focus groups to help with survey design. We administered the survey in two waves. We asked respondents to report on seven popular new drugs, and to describe a variety of HMO organizational characteristics. PRINCIPAL FINDINGS: Several HMO organizational characteristics, including nonprofit status, the incentives facing the director of the pharmacy, size and make-up of the pharmacy and therapeutics committee, and relationships with drugs makers, all affect formulary adoption. CONCLUSIONS: There are many organizational factors that may cause HMOs to make different formulary adoption decisions for certain prescription drugs.
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