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American Journal of  Financial 
Technology and Innovation (AJFTI)

The Impact of  Drug Pricing and Insurance Coverage on Medication Adherence in Saudi 
Turki M. Alsagoor1*

Volume 1 Issue 1, Year 2023
https://journals.e-palli.com/home/index.php/ajfti

Article Information ABSTRACT

Received: October 05, 2023

Accepted: November 01, 2023

Published: November 08, 2023

This study explores the complex interactions in Saudi Arabia between medicine costs, 
insurance coverage, and medication adherence. 250 individuals’ data were analysed, and 
significant relationships were found. With a significant coefficient of  -0.773 (p = 0.006), 
high medicine prices were shown to be a significant barrier to medication adherence. On the 
other hand, complete insurance protection showed a favorable connection with adherence, 
highlighting its crucial function. The fact that 69% of  the participants had health coverage 
and 31% did not highlights a sizable insurance gap. Males comprised 80% of  the sample, 
62% of  respondents were in the 29–39 age range, and 56% had bachelor’s degrees. The 
income range showed that 43% made more than 20,000 SAR monthly. The significant 
effects of  medicine cost and insurance coverage on medication adherence were highlighted 
by regression analysis (Beta = -0.749, p = 0.001, and 0.759, p = 0.006, respectively). These 
results highlight the criticality of  addressing the affordability of  prescription costs and 
advocating for open insurance programmes to improve healthcare outcomes in Saudi 
Arabia. Prioritising actions can help reduce costs and provide comprehensive coverage, 
say policymakers. This study emphasises the need for more research to dive further into 
the intricacies of  healthcare accessibility, particularly in a healthcare environment that is 
continually expanding.

Keywords
Medical Adherence, Drug 
Pricing, Insurance Coverage, 
Medical Insurance, Medicine Cost

INTRODUCTION 
Pharmaceutical pricing is a complex process considering 
profit margins, manufacturing costs, and costs associated 
with research and development (Schlander et al., 
2021). Pharmaceutical firms, wholesalers, distributors, 
pharmacies, insurance companies, and public healthcare 
programs are a few of  the many parties involved in this 
complex process, substantially impacting patients’ access 
to pharmaceuticals  (Wong et al., 2023). Due to this, 
the challenge of  high drug prices becomes even more 
daunting due to the scarcity of  essential affordability 
for patients (Adebisi et al., 2022). The expensive cost of  
medication can create barriers, causing individuals to stop 
taking their prescribed drugs, resulting in detrimental 
health problems (Ding et al., 2022). Furthermore, 
between medication acquisition and fulfilling other 
essential requirements, such as housing, sustenance, 
or utilities, patients may be forced to make arduous 
decisions due to monetary constraints (Malecha et al., 
2018). Consequences of  treatment failure may lead to 
individuals resorting to reduced doses, missed doses, or 
treatment discontinuation, resulting in non-adherence. 
Non-compliance with treatment guidelines can lead 
to costlier care and a greater chance of  developing 
complications, according to (Emadi et al., 2022).
Emadi et al. (2022) state that the interplay between 
drug pricing and insurance coverage profoundly affects 
MA, touching numerous parties, including individuals, 
healthcare providers, and society. Extending it further 
Frieden et al.,(2019) has highlighted that due to the 
combination of  mounting drug prices and suboptimal 
insurance coverage, MA reduction can lead to adverse 

impacts on patient health and the larger healthcare system 
(Emadi et al., 2022; Frieden et al., 2019). High prescription 
drug prices are prominent in countries with market-based 
healthcare systems, such as the United States (Patel et 
al., 2018). These soaring prices result from research and 
development expenses, regulatory clearance costs, pricing 
strategies employed by pharmaceutical companies, and 
limited negotiation leverage held by payers (Bhide, 2022). 
According to González Vera et al.’s (2022) findings, 
patients frequently struggle with adherence due to 
financial burdens (González Vera et al., 2022).
By covering the cost of  prescription medications, 
insurance plays a critical role in reducing the financial 
strain. Comprehensive insurance plans enhance 
medication adherence, and lower out-of-pocket costs 
are made possible (Reynolds et al., 2020). Wide variation 
exists in insurance coverage, leaving room for confusion 
and frustration. According to Meng et al. (2015) and Yang 
et al. (2020), such measures as prior authorisation and step 
therapy create challenges to accessing vital medications 
(Meng et al., 2015; Yang et al., 2020). All stakeholders, 
including patients, healthcare providers, insurance 
companies, and policymakers, must join forces to find 
practical solutions for complex challenges (Bali & Ramesh, 
2023). Measures to advance price transparency, boost 
competition in the pharmaceutical sector, and control 
prescription pricing can be undertaken by policymakers 
(Ahmad et al., 2020). Mandating prescription drug 
coverage by insurance providers could increase patient 
compliance rates. Saudi Arabia’s study aims to investigate 
the effect of  drug pricing and insurance coverage on 
medication adherence (MA) (AlQarni et al., 2019). High 

1 Saudi Food and Drug Authority, Saudi Arabia
* Corresponding author’s e-mail: tmsagoor@sfda.gov.sa 



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medicine costs and subpar insurance protection in light of  
the increasing frequency of  persistent non-communicable 
disorders impact patient compliance with medication 
(Dias, 2023). By examining the interplay of  drug pricing, 
insurance coverage, and MA in Saudi Arabia, the research 
will identify evidence-based approaches to strengthen 
medication affordability, coverage, and adherence. As 
they relate to public health, these findings offer significant 
improvement opportunities, cost containment, and access 
enhancements, thus contributing positively to society.

LITERATURE REVIEW
Across the globe, there has been an increase in research 
on drug pricing, insurance, and medication adherence 
(MA) in recent times. Diving deeper into the intricacies of  
the issue, Manna et al (2020) has highlighted a significant 
need to shed light on its implications for public health 
outcomes. The study has further emphasised examining 
the relationship between drug pricing, insurance coverage, 
and MA in Saudi Arabia, as well as evidence-based 
solutions that can be applied to address these challenges 
(Manna et al., 2020).

A Complexity in Drug Pricing and Insurance 
Characterises: The Current Setup
In Saudi Arabia and numerous other nations, drug pricing 
is an intricate process influenced by multiple factors 
(Almutairi et al., 2023). Pharmaceutical companies et 
al., play a part in deciding how much patients or their 
insurance providers ultimately pay in the end. Per IQVIA 
(2021), Saudi Arabia’s pharmaceutical market, valued at 
$7.23 billion in 2021, is poised for significant growth in 
the forthcoming year. As cited by Yang eta al, (2020), 
the above factors contribute to the growth seen here. 
Examining the current drug pricing schemes is essential 
since they directly impact the Saudi healthcare system 
(Yang et al., 2020).
Patients in Saudi Arabia may face drug cost increases 
due to poorly designed pricing structures. Ding et al. 
(2022), has highlighted that with high medication costs, 
individuals may need help prioritising necessities or their 
medications. The Ministry of  Health of  Saudi Arabia 
(2020) notes that approximately 60% of  pharmaceutical 
spending in Saudi Arabia was financed through direct 
patient payments(Ministry of  Health & Saudi Arabia, 
(2017).
Due to this alarming statistic, the population’s access 
to affordable medication is imperative. Distinct policies 
offer varied levels of  coverage when it comes to 
insurance in Saudi Arabia (Albugmi, 2021). Depending 
on the plan, some insurance policies may cover drugs 
comprehensively, while others may levy high co-payments 
and deductibles upon patients (Meng et al., 2015). A SAMA 
study found that in 2021, only 24% of  the population 
had health insurance coverage, indicating restricted access 
to coverage. Insurance coverage disparities substantially 
hinder all demographic groups’ access to essential 
medications (Adebisi et al., 2022).

Relationship between Drug Pricing and Insurance 
and its Impact on Medical Adherence
The effect of  prescription drug pricing and insurance 
coverage is substantial in Saudi Arabia’s changing 
healthcare landscape. Patients’ capacity to follow their 
prescribed medicine regimens depends largely on 
their financial situation (Emadi et al., 2022). Evidence 
supports that medication prices, insurance coverage, and 
adherence are connected, such as the study by Smith et al., 
(2019), stresses that patients who experienced financial 
constraints due to limited insurance coverage had lower 
medication adherence (Smith et al., 2019).
Lifestyle factors and socio-economic changes have 
caused a notable increase in the prevalence of  chronic 
non-communicable diseases such as diabetes and 
cardiovascular diseases in Saudi Arabia (Al-Hanawi & 
Keetile, 2021), . Managing diseases via medication makes 
non-adherence a critical problem. Mohiuddin, (2019) 
found that approximately 60% of  patients with chronic 
conditions in Saudi Arabia fail to comply with medical 
regimens. The study has also noted Adverse effects are 
experienced at both the personal and communal levels 
due to medication adherence (Mohiuddin, 2019). Emadi 
et al. (2022) highlight that individuals may suffer from 
uncontrolled disease progression, resulting in higher 
morbidity and mortality rates (Emadi et al., 2022). 
According to Anderson et al. the potential for preventable 
hospitalisations and complications has significant 
consequences at the societal level (Anderson et al., 2020). 
Approximately 13.5 billion Saudi Riyals ($3.6 billion) 
more was added by non-adherence to medical therapies, 
as reported by Saudi Aramco, (2023). These statistics 
showcase, non-adherence in the Saudi healthcare 
ecosystem demands immediate attention (Aramco, 2023).

Evidence-Based Approaches for Enhancing Medical 
Adherence
Evidence-based methods are essential to promote 
adherence among the Saudi population, and understanding 
how drug pricing and coverage contribute to this is vital.

Value-Based Pricing Models
Gaining Favor, value-based pricing models now prioritise 
drug price alignment with therapeutic value. according to 
Stecker et al. (2015), determining the cost of  a medication 
involves considering factors including efficacy, safety, and 
alternative treatments (Stecker et al., 2015). Alignment 
with their benefits and subsequent cost reduction is what 
patients may see by implementing value-based pricing in 
Saudi Arabia.

Increasing Price Transparency
In addition to other factors, price transparency is vital 
in controlling medication costs. Transparency in pricing 
assures decision-making across all groups for medication 
choices and coverage (Godman et al., 2021). Saudi Arabia’s 
increased price openness paves the way for pharmaceutical 
company competition, resulting in more affordable drugs.



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Expanding Insurance Coverage
Expanding insurance coverage is crucial to achieve 
medication availability for all. Cairney and Oliver (2017) 
suggest that policymakers in Saudi Arabia should focus on 
expanding public health insurance systems while offering 
financial support to low-income individuals and ensuring 
that insurance companies include comprehensive 
prescription coverage in their policies (Cairney & Oliver, 
2017). Through these measures, the gap in insurance 
coverage can be closed, resulting in increased accessibility 
to medications for the public (Knapp & Wong, 2020).

Healthcare Provider Interventions
Healthcare providers have a significant role in MA, 
including selecting economical treatment options, 
considering patients’ financial conditions, and 
collaborating with patients in shared decision-making 
to overcome adherence challenges (Ahmed et al., 2018) 
(Ahmed et al., 2018). Following Al Jeraisy et al. (2023) 
lead, they help ease the financial pressure on patients 
by coordinating their access to assistance programs (Al 
Jeraisy et al., 2023).

Government Initiatives
It is pertinent for policymakers to create laws that restrain 
drug costs, promote competition in the pharmaceutical 
business, and guarantee price negotiations for prescription 
medications. According to Sanders et al. (2016), tax 
breaks may be offered to reduce patients’ financial 
responsibilities.

Multistakeholder Collaboration
Multiple stakeholders must work together, and lastly. 
Findings from Ding et al. (2022) underscore the 
importance of  cooperative efforts from all parties 
concerned - patients, healthcare professionals, insurers, 
pharmaceutical companies, and policymakers - when 
it comes to enhancing adherence and overcoming 
economic obstacles. Intertwined factors of  drug pricing, 
insurance coverage, and medication adherence necessitate 
harmonious coordination between these parties for 
effective resolution (Kanyongo & Ezugwu, 2023).

Hypothesis
The following hypothesis has been formed by examining 
the relationship between medical adherence and drug 
prices and the influence of  medical insurance.

Hypothesis 1 H1a: High medicine prices negatively 
impact MA in Saudi Arabia.

Hypothesis 2 H2a: Lower MA in Saudi Arabia is related 
to insufficient insurance coverage.

Hypothesis 3 H3a: Increasing insurance coverage and 
implementing policy changes can help with MA in Saudi 
Arabia.

MATERIAL AND METHODS
The study employed a quantitative research method to 
examine the linkages between drug pricing and insurance 

coverage and their influence on medication adherence 
among individuals residing in Saudi Arabia. Through 
the cross-sectional method, interrelationships were 
scrutinised and grasped. The selection of  quantitative 
research hinges on its efficient and impartial data 
collection and analysis capabilities. The positivist 
perspective emphasises using objective and verifiable 
evidence to bolster the advancement of  the process. 
Mahajan (2020) states that larger sample sizes translate 
to greater generalizability. As Creswell and Hirose (2018) 
described, quantitative research excels when utilising 
standardised and systematic data collection methods.

Research Design
The study employed a cross-sectional approach to collect 
information simultaneously from a diverse population. 
Medication adherence can be influenced by reviewing 
three factors: drug pricing, insurance coverage, and 
income. Correlation analysis between variables was 
enabled through Bhardwaj’s design (2019). Further 
characteristics of  the research process are described in 
the following sections:

Target Population and Sampling
Due to drug pricing, income, and insurance coverage, 
the study group included all Saudi Arabian citizens 
experiencing difficulties with medication adherence. 
According to Bujang et al. (2018), a sample of  250 
individuals was surveyed using randomised sampling 
to obtain a reliable representative of  the general public. 
95% confidence and a 5% margin of  error governed the 
investigation process.

Data Collection Approach
Data collection comprised a questionnaire disseminated 
online using Google Forms to ensure confidentiality 
and ease. Participants were evaluated on their opinions 
of  prescription cost, insurance coverage, and medication 
adherence using closed-ended questions on a Likert-type 
scale. Validity and reliability were established through pre-
testing on a representative sample (Bujang et al., 2018).

Data Analysis
SPSS and Microsoft Excel are employed for data analysis 
because of  their versatility in social sciences and how they 
easily handle vast amounts of  data to provide essential 
insights(Baker et al., 2022). Data’s characteristics can be 
understood using descriptive statistics, which consist of  
the mean, median, mode, and standard deviation (Creswell 
& Hirose, 2019). The correlation matrix, shown by Graff  
Elman and de Leeuw (2023), discovered ties among 
variables (Graffelman & De Leeuw, 2023). Employed in 
an analysis process, PCA and FA helped identify patterns  
(Li et al., 2021). Additionally, their importance extended 
beyond the realm of  data analysis alone. Employed by 
Mooi et al. (2018), multiple Linear Regression examined 
the relationships between dependent and independent 
variables. Furthermore, Bujang et al. (2018), has stressed 



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that Cronbach’s Alpha was used to determine survey 
reliability (Bujang et al., 2018; Mooi et al., 2018).

Ethical Considerations
Maintaining ethical principles was crucial throughout the 
research. Participants provided informed consent after 
being informed about the potential benefits and risks. 
Privacy is safeguarded thanks to identification codes and data 
encryption. No consequences existed for participants who 
chose not to participate in the study. Preventing research 
abuse requires maintaining data evaluation transparency 
and integrity (See Ethical Considerations). Great care was 
taken to observe ethical principles throughout the research 
to guarantee the security and comfort of  participants. 
Ethical considerations demand the protection of  integrity 
and respect for participants’ rights.

Informed Consent
Collaboration was fostered when participants were 
presented with thorough information regarding the 
study’s goals, procedures, and potential gains and 
drawbacks. Consent from all participants was obtained 
after educating them on the process.

Privacy Protection
Safeguarding participants’ privacy and data required the 
implementation of  specific measures. Individual anonymity 
was maintained by assigning unique identification codes, 
data encryption, and results aggregation.

Non-Coercion
There were no adverse repercussions for either expressing 
ethical concerns or choosing to opt out of  the study. 
Their participation was entirely voluntary.

Transparency and Data Integrity
To maintain the highest levels of  ethical standards, 
all parties involved ensured that no form of  research 
misconduct entered into their procedures, such as 
selective reporting of  results or distortion of  figures. 
Before data dissemination, accuracy and transparency 
were scrutinised.

By incorporating ethical factors, the study ensured high 
research integrity, participant well-being, and credibility.

RESULTS AND DISCUUSSION
This research delves into a critical issue plaguing the 
healthcare landscape in Saudi Arabia-the intricate interplay 
between drug pricing, insurance coverage, and medication 
adherence. Our study is not just an exploration but a 
clarion call to recognise the far-reaching ramifications 
of  these factors on the health and well-being of  Saudi 
Arabian citizens. In an era where access to healthcare is 
paramount, understanding these dynamics can pave the 
way for more robust health policies and improved patient 
outcomes. To unearth the undeniable impact of  drug 
pricing and insurance coverage on medication adherence, 
we embarked on a journey driven by methodical rigour 
and precision. Our primary data collection leveraged the 
online survey method, engaging with 250 participants 
selected through simple random sampling. The arsenal 
of  statistical tools at our disposal included Microsoft 
Excel and the venerable IBM SPSS-26 (George & 
Mallery, 2019), enabling us to conduct comprehensive 
analyses encompassing descriptive, factor, correlational, 
and regression analyses. These analyses uncovered the 
latent variables at the heart of  our research-drug pricing, 
insurance coverage, and medication adherence.

Demographic Insights
The demographic landscape of  our study is a mosaic that 
reflects the diversity of  Saudi Arabia. Understanding our 
participants provides the foundation upon which our 
research is built.
The findings of  the study as illustrated in Table 1 reveal 
a spectrum of  age groups among participants. While 
62.4% fall within the 29-39 years bracket, a substantial 
14.8% belong to the 18-28 years and 40-50 years groups. 
Remarkably, even participants above 50 years make up 
8% of  our cohort. Of  the 250 participants, 15% belong 
to the 18-28 age group, 62% to the 29-39 years group, 
15% to the 40-50 years group, and 8% are more than 50 
years old.
Gender distribution of  the study participants, as depicted 

Table 1: Age of Respondents
Frequency Per cent Valid Percent Cumulative Percent

Valid 18-28 Years 37 14.8 14.8 14.8
29-39 Years 156 62.4 62.4 77.2
40-50 Years 37 14.8 14.8 92.0
More than 50 Years 20 8.0 8.0 100.0
Total 250 100.0 100.0

Table 2: Gender of Participants
Frequency Per cent Valid Percent Cumulative Percent

Valid Female 51 20.4 20.4 20.4
Male 199 79.6 79.6 100.0
Total 250 100.0 100.0



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in table 2, underscores the gender disparity in our study. 
A striking 80% of  participants are male, while females 
constitute 20%.
The study’s findings illustrated in table 3.  have shown 
that among the study participants, 56% hold bachelor’s 
degrees, 31% have master’s degrees, 8% have high school 
diplomas, and 5% are Ph.D. holders.
The monthly income of  the participants is equally varied, 
as shown in Table 4. Notably, 43% earn more than 2000 
SAR monthly, while 18% earn below 10,000 SAR. While 
20% of  the participants have income between 1600 to 
2000 SAW per month, the rest, 18%, have 110000-15000 
average monthly income.

The study’s findings in Table 5. have also revealed that 
people from various regions have participated, with the 
central region dominating at 70.8%. The western region 
follows at 12.8%, while other regions have smaller 
representations: 3% in the eastern region, 1% outside of  
the Kingdom of  Saudi Arabia, 13% in the western region, 
and 9% in the southern region.
A vital facet of  our research is insurance coverage, 
illustrated in Table 6, revealing that almost 69% of  
participants possess insurance coverage, while 31% do 
not, highlighting that 1/3 of  the Saudi population doesn’t 
have insurance coverage. In contrast, the hospitals worked 
only a negligible amount of  insurance.

Table 3: Education Level
Frequency Per cent Valid Percent Cumulative Percent

Valid Bachelors’ Degree 140 56.0 56.0 56.0
High School 19 7.6 7.6 63.6
Master’s Degree 77 30.8 30.8 94.4
Ph.D.                          13 5.2 5.2 99.6
PharmD 1 .4 .4 100.0
Total 250 100.0 100.0

Table 4: Monthly Income of Participants
Frequency Per cent Valid Percent Cumulative Percent

Valid 110000-15000 SAR 46 18.4 18.4 18.4
16000-20000 SAR 51 20.4 20.4 38.8
Less than 10000 SAR 45 18.0 18.0 56.8
More than 20000 SAR 108 43.2 43.2 100.0
Total 250 100.0 100.0

Table 5: Residence of Participants
Frequency Per cent Valid Percent Cumulative Percent

Valid Central Region 177 70.8 70.8 70.8
Eastern Region 8 3.2 3.2 74.0
I live outside of  the Kingdom 
of  Saudi Arabia

2 .8 .8 74.8

Northern Region 8 3.2 3.2 78.0
Southern Region 23 9.2 9.2 87.2
Western Region 32 12.8 12.8 100.0
Total 250 100.0 100.0

Table 6: Insurance Coverage
Frequency Per cent Valid Percent Cumulative Percent

Valid Covered by the Hospital I Work In 1 .4 .4 .4
No 78 31.2 31.2 31.6
Yes 171 68.4 68.4 100.0
Total 250 100.0 100.0

Measurement of  Drug Pricing
Reliability statistics for Drug Pricing, as shown in Table 7. 
shows volumes, as Cronbach’s Alpha coefficient of  0.810 
indicates strong internal consistency among the five items 

used to measure Drug Pricing. These results validate the 
efficacy of  our Drug Pricing measurement.
The total variation in observable variables that may 
be explained by drug pricing is shown in Table 8.  and 



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Table 7: Reliability Statistics of Drug Pricing
Cronbach's Alpha Cronbach's Alpha Based on Standardised Items N of Items
.814 .810 5

Table 8: Total Variance Explained by Drug Pricing in Observed Variables 
Component Initial Eigenvalues Extraction Sums of Squared Loadings

Total % of Variance Cumulative % Total % of Variance Cumulative %
1 2.903 58.066 58.066 2.903 58.066 58.066
2 .927 18.534 76.601
3 .469 9.386 85.987
4 .391 7.817 93.804
5 .310 6.196 100.000
Extraction Method: Principal Component Analysis

Table 9: Component Matrix (Drug Pricing)
Component
1

High drug prices significantly affect my ability to purchase and use medications as prescribed consistently. .813
I have skipped or reduced medication doses due to the cost of the drugs. .809
I have experienced financial strain due to the cost of my medications. .814
Lowering drug prices would improve medication adherence in Saudi Arabia. .482
The cost of medications has led me to seek alternative treatments or therapies. .834
Extraction Method: Principal Component Analysis

emphasises how important this factor is. The first 
component is significant in our analysis since it accounts 
for 58.066% of  the total variation.
The Component Matrix (Drug Pricing) findings are 
illustrated in Table 9. elucidates the relationships between 
observed variables and the extracted component. Notably, 
observed variables exhibit strong loadings on Component 

1, further emphasising the relevance of  Drug Pricing in 
our research. For example, observed variable 4, “Seeking 
alternative treatments due to medication cost,” had a high 
loading of  0.834 and a good correlation with Component 
1 of  drug price. Other factors also exhibit significant 
loadings on Component 1, confirming their significance 
in determining medicine pricing.

Measurement of  Insurance Coverage
Reliability statistics for Insurance Coverage, in Table 10. 
reinforce the credibility of  our measurement scale with a 
Cronbach’s Alpha coefficient of  0.791.
The entire variation explained by insurance coverage 
is shown in Table 11 The first component solidifies its 

status as a significant factor by explaining 47.814% of  the 
total variation.
The Component Matrix (Insurance Coverage) in Table 
12 highlights the significant correlations between the 
extracted component and the observed variables, further 
supporting the significance of  Insurance Coverage.

Table 10: Reliability Statistics of Insurance Coverage
Cronbach's Alpha Cronbach's Alpha Based on Standardised Items N of Items
.768 .791 5

Table 11: Total Variance Explained by Insurance Coverage in Observed Variables
Component Initial Eigenvalues Extraction Sums of Squared Loadings

Total % of Variance Cumulative % Total % of Variance Cumulative %
1 2.391 47.814 47.814 2.391 47.814 47.814
2 1.246 24.912 72.726
3 .625 12.497 85.223
4 .441 8.812 94.035
5 .298 5.965 100.000

Extraction Method: Principal Component Analysis



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Measurement of  Medication Adherence
With a Cronbach’s Alpha coefficient of  0.824, the 
reliability data for medication adherence shown in 
Table 13 support the validity of  our assessment scale. 
The reliability of  the measuring items for medication 
adherence is attested to by Cronbach’s Alpha value of  
0.824.
The entire variation explained by medication adherence 
is shown in Table 14. A significant 59.789% of  the 
total variation is explained by the first component, 
demonstrating its importance. The first component 
accounts for 59.789% of  the variation overall, highlighting 

the importance of  medication adherence.
Based on the principal component analysis, Table 15 
shows the component matrix of  medication adherence 
and its observed factors. The link between each observed 
variable and the extracted component is indicated by the 
numbers in the Component 1 column. Higher absolute 
values show a stronger association. The observed variable 
3, for instance, has a high loading of  874 on Component 
1, indicating a substantial link between this variable and 
the extracted component of  medication adherence. I am 
confident I can continuously follow my medication plan 
without missing doses.

Table 12: Component Matrix (Drug Pricing)
Component
1

My current insurance coverage adequately covers the cost of my prescribed medications. .785
I have experienced difficulties in obtaining insurance coverage for specific medications. .464
I am satisfied with the range of medications covered by my insurance provider. .863
The insurance claim process for medications is simple and efficient. .777
I have avoided or delayed seeking medical care due to concerns about insurance coverage for medications. .460
Extraction Method: Principal Component Analysis.
a. 1 Component Extracted: (Insurance Coverage)

Table 13: Reliability Statistics of Medication Adherence
Cronbach's Alpha Cronbach's Alpha Based on Standardised Items N of Items
.806 .824 5

Table 14: Total Variance Explained by Medication Adherence in Observed Variables
Component Initial Eigenvalues Extraction Sums of Squared Loadings

Total % of Variance Cumulative % Total % of Variance Cumulative %
1 2.989 59.789 59.789 2.989 59.789 59.789
2 1.012 20.245 80.034
3 .447 8.931 88.965
4 .310 6.209 95.174
5 .241 4.826 100.000
Extraction Method: Principal Component Analysis.

Table 15: Component Matrix (Medication Adherence)
Component
1

I understand the importance of adhering to my medication regimen to achieve the desired 
therapeutic outcomes.

.788

Taking medications exactly as my healthcare provider prescribes is essential for managing my 
health condition(s).

.841

I am confident in following my medication schedule consistently without missing doses. .874
I actively communicate with my healthcare provider if I experience any difficulties or side effects 
related to my medications.

.786

I have a system (e.g., reminders, pill organisers) to help me manage my medication adherence effectively. .529
Extraction Method: Principal Component Analysis.
a. 1 Component Extracted: (Medication Adherence)



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RESULTS OF CORRELATION ANALYSIS
The Pearson correlation test findings in Table 16 show 
significant correlations between the variables. Drug 
cost and insurance coverage have a substantial negative 
connection (r = -0.768, p 0.001), while their link with 
medication adherence is inverse and negative (r = -0.773, 
p = 0.006). Similarly, while it is not statistically significant, 
a positive association exists between insurance coverage 

and medication adherence (r = 0.002, p = 0.709). These 
results imply that increasing insurance coverage and 
medication adherence are related to higher drug prices. 
However, a weak and statistically insignificant link 
exists between insurance coverage and drug adherence. 
These findings in this study indicate the possible impact 
of  drug costs on insurance coverage and medication 
adherence.

Table 16: Results of the Pearson Correlation Test
Drug Pricing Insurance Coverage Medication Adherence

Drug Pricing Pearson Correlation 1 .768** -.773**
Sig. (2-tailed) .000 .006
N 250 250 250

Insurance Coverage Pearson Correlation -.768** 1 .742
Sig. (2-tailed) .000 .009
N 250 250 250

Medication Adherence Pearson Correlation -.773** .002 1
Sig. (2-tailed) .006 -.768
N 250 250 250

**. Correlation is significant at the 0.01 level (2-tailed).

RESULTS OF REGRESSION ANALYSIS
Because the value of  p is less than 0.05, which symbolises 
the significant differences between the groups of  
the mean of  each variable, the above-given ANOVA 
table demonstrates that all the provided variables are 
substantially different.
The regression analysis results employing the two 
independent variables of  drug cost and insurance 
coverage are summarised in Table 17. Unstandardised 
coefficients (B) depict the anticipated change in 

medication adherence when each independent variable is 
changed by one unit while the others remain unchanged. 
The standardised influence of  these factors on medication 
adherence is measured by standardised coefficients 
(Beta). The statistical significance is determined by the 
T-values and p-values (Sig.). The substantial effects of  
both independent factors on medication adherence have 
confirmed all research hypotheses. Regression analysis 
p-values show a robust association between high drug 
costs, insurance coverage, and medication adherence.

Table 17: Results of the ANOVA Test 
Model Sum of Squares Df Mean Square F Sig.
1 Regression 12.288 2 6.144 6.411 .002

Residual 236.713 247 .958
Total 249.000 249

a. Dependent Variable: Medication Adherence
b. Predictors: (Constant), Insurance Coverage, Drug Pricing

Table 18: Results of Multiple Regression Analysis
Model Unstandardised Coefficients Standardised Coefficients T Sig.

B Std. Error Beta
1 (Constant) 4.070E-7 .062 .000 1.000

Drug Pricing -.747 .070 .749 3.516 .001
Insurance Coverage .758 .070 .759 2.243 .006

a. Dependent Variable: Medication Adherence

DISCUSSION
The findings of  a current study highlight the difficulty of  
medication adherence in Saudi Arabia. This study reveals 
the relevance of  medication cost and insurance coverage 

as the foundation of  healthcare outcomes. According 
to the study, expensive medications have a considerable 
negative impact on medication adherence. The analysis 
revealed a disturbing truth: patients who struggle with 



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high pharmaceutical expenses are more prone to non-
compliance. For those with chronic illnesses, there are 
significant accessibility barriers, and these barriers are 
especially obvious when considering prescription costs. 
The findings of  Kennedy-Martin et al. (2017) show how 
expensive prescription drugs combined with insufficient 
insurance can result in significant patient outlays 
(Kennedy-Martin et al., 2017). The study by Torres-
Robles et al. (2021), examining this relationship found that 
high out-of-pocket expenses are associated with reduced 
drug adherence, particularly evident in those dealing with 
chronic illnesses. These results demonstrate that medicine 
costs significantly influence patient behaviour (Torres-
Robles et al., 2022). Despite Saudi Arabia’s advanced 
healthcare system, high drug costs make it difficult for 
patients to comply with their treatments effectively. 
According to Lee et al.’s (2020) study, people with multiple 
sclerosis must change their medicine consumption due to 
high out-of-pocket expenses. Compromise in adherence 
caused by expensive drugs is a serious issue since it 
adversely affects patient outcomes (Lee et al., 2020).
High prescription prices may give off  a negative 
impression, but the study demonstrates that adherence 
is supported by full insurance coverage. Compliance rises 
when patients have access to insurance or less expensive 
medication choices. This conclusion emphasises the need 
for comprehensive and user-friendly insurance coverage 
for patients’ access and affordability. This theory is 
supported by two recent studies, those of  Yang et al. (2020) 
and Wong et al. (2023), which demonstrate that health 
insurance eases the financial burden on patients by paying 
for a portion of  their medical expenses (Wong et al., 2023; 
Yang et al., 2020). According to these aforementioned 
researches those with health insurance are more likely 
to follow their prescriptions. Investments in insurance 
coverage-focused policies can increase adherence and 
enhance health outcomes, making them beneficial.
In addition to examining the connection between 
prescription costs and insurance coverage, this study 
also examines other aspects of  medication compliance. 
Patient education and awareness campaigns are among 
the most important factors in encouraging adherence. 
Providing patients with prescription information, such as 
dosing instructions and possible adverse effects, improves 
adherence to the prescribed course of  action. According to 
research by Reed et al. (2017), improved education results 
in higher adherence rates. Equal focus should be placed on 
patient and healthcare professional communication (Reed 
et al., 2017). When communication improved and became 
more compassionate, medication compliance increased. 
The relationship between positive patient interactions 
and medication compliance is clear when patients 
report. As Brown et al. (2016) demonstrated, lowering 
patients’ expenditures necessarily increases adherence. 
The study emphasises the significance of  easily available 
pharmacies. Better adherence was closely correlated with 
easier pharmacy access, with patient convenience playing 

a crucial role (Brown et al., 2016). Morrissey et al. (2016) 
emphasise the importance of  convenience in healthcare 
delivery, noting that patients may need more access to 
their treatment regimens (Morrissey et al., 2016).

CONCLUSION 
In conclusion, the results of  this study offer important 
new perspectives on the intricate relationships between 
Saudi Arabia’s medicine prices, insurance coverage, and 
medication adherence. The study used a quantitative 
research methodology to examine the correlations 
between these characteristics by gathering data from 
a sample of  250 people. The investigation produced 
significant results illuminating Saudi Arabia’s healthcare 
management possibilities and difficulties. The study first 
highlighted the considerable effect of  expensive medicine 
costs on medication adherence. It was shown that patients 
who had trouble paying for their drugs were more likely 
to have poorer adherence rates. These findings support 
the body of  material already in existence by highlighting 
the link between patient compliance and drug prices. 
Studies by Kennedy-Martin et al. (2017), Torres-Robles 
et al. (2021), and Yosef  et al. (2023) have all shown that 
patients, particularly those with chronic conditions, 
may incur higher out-of-pocket costs as a result of  high 
prescription drug prices. This emphasises the importance 
of  affordability in influencing drug adherence behaviours.
The study results show a considerable association 
between high drug prices and nonadherence (r = -0.773, 
p = 0.006). On the other hand, extensive insurance 
protection encourages adherence. Sixty-nine per cent 
of  the 250 participants had insurance, while just 31% 
did not. Participants were split 80/20 between men 
and women. Approximately 62% of  the respondents 
in the survey were in their twenties to thirties, 56% had 
bachelor’s degrees, and 43% had monthly incomes above 
20,000 SAR. The largest portion (70.8%) was from the 
central area. The substantial effects of  medicine cost 
and insurance coverage on medication adherence were 
also verified by regression analysis (Beta = -0.749, p = 
0.001 and Beta = 0.759, p = 0.006, respectively). While 
extensive insurance coverage encourages compliance, 
exorbitant medication prices impede it. Affordability and 
accessibility of  insurance plans should be a priority for 
policymakers to enhance.

RECOMMENDATIONS
The findings of  this study can have a significant influence 
on Saudi Arabia’s healthcare policies. Policymakers 
should think about a multifaceted strategy to improve 
drug adherence and, subsequently, health outcomes:

Affordable Drug Pricing
Reducing exorbitant drug costs should be a focus. 
Indirectly, increased patient compliance is helped by 
policies designed to lower the cost of  medications or to 
provide financial assistance.



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Am. J. Financ. Technol. Innov. 1(1) 24-34, 2023

Comprehensive Insurance Coverage
Patients follow their programs more faithfully when they 
aren’t concerned about paying expensive out-of-pocket 
costs for required prescriptions, thanks to comprehensive 
health insurance.

Patient Education and Communication
Empowerment is attained by encouraging collaboration 
between healthcare professionals and patients, which 
results in improved condition management through 
education and communication.

Pharmacy Accessibility
By ensuring easy access to pharmacies, we can speed 
up the processes for picking up new prescriptions and 
renewing old ones.

Holistic Approach
As legislators create regulations about medication 
adherence, a complete viewpoint is essential.
This study draws a strong conclusion by examining the 
complex relationships between drug cost, insurance, 
and medication adherence. These five factors-
complete coverage, improved education, crystal-clear 
communication, and easily accessible pharmacies-create 
an unbreakable wall of  support for greater adherence 
in the face of  pricey medications. These findings shed 
light on the importance of  health and pave the way for 
healthier, more devoted communities.
 
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