I don't see why it wouldn't work. There are already time release contraceptives that are inserted into a woman's arm, such as Norplant. Sure its not a microchip but it provides a similar effect.
I could see some benefits of use by Alzheimer patient, and those with chronic ailments such as heart disease, osteoporosis, and diabetes since a needed dose of medication can be provided at precisely the right time. I can also see an expensive upkeep of the technology as any microchip would be susceptible to static electrical charges and rendered useless or incapable to deliver the proper dosage, though I'm sure there will also be some sort of home device that can diagnose technical issues. Heck, for diabetes it might also be able to scan for sugar levels and the user would never have to prick for blood again.
Sounds like good technology to invest in.