Dublin Academic Medical Centre Summer School 2009

Transcription

1 Health Care Economics Dublin Academic Medical Centre Summer School 2009 Peter Carney UCD Geary Institute UCD School of Economics UCD Geary Institute University College Dublin Belfield, Dublin 4 Ireland geary@ucd.ie Institiúid Geary UCD, An Coláiste Ollscoile, Baile Átha Cliath, Belfield, Baile Átha Cliath 4, Eire

2 Healthcare Economics & Economic Evaluation Overview of Economist s Perspective Introduction to the Principles Economic Evaluation of Healthcare Suite of Tools A Guide to Critical Assessment (10 point)

3 Introduction to economic analysis in health care Health economics is the application of economic theory, models and empirical techniques to the analysis of decision-making by individuals, health care providers and governments with respect to health and health care It offers a unique and systematic intellectual framework for analysing important issues in health care. This is useful since the healthcare sector consumes a great deal of resources, and because the organisation and delivery of health care is influenced by the economic environment and economic conditions.

4 Is health care an economic good? An economic good is any good or service that is scarce relative to our wants for it. Heath care is an economic good because the resources that are used to produce health care services are finite. More resources can be devoted to the production and consumption of health care only by diverting them form some other use. Health care is an economic good because our wants for health care have no known bounds No health care system has achieved levels of spending sufficient to meet all its citizens wants for health care

5 Overview of Economist s Perspective So in essence, resources time, labour, facilities, equipment, knowledge are limited. We do not have the resources to satisfy all the goods and services that we desire. Resources spent on one item cannot be spent on another. This gives rise to the concept of Opportunity Cost; the value of the best forgone alternative. In a real sense, the cost of any programme is not the s in the budget sheet but rather the health outcomes from the programme which has been forgone by committing the resources in question to the first programme.

6 Overview of Economist s Perspective Economic evaluations are not concerned with accounting costs, financial management and cost-cutting. Concern is with the comparative analysis of alternative courses of action in terms of both their cost and consequences to make the best use of available resources. The ultimate aim of healthcare evaluation is the choosing of programmes that maximise benefits for society from society s resources.

7 2. Economic Evaluation of Healthcare Economic evaluations as a tool for healthcare assessment and cost-effectiveness in particular. Drummond et al. (2005) - Economic Evaluation of Health Care Programmes.

8 The Suite of Tools Cost-minimisation analysis Cost-effectiveness analysis Cost-consequences analysis Cost-utility analysis Cost-benefit analysis The four tools value consequences by assuming them either as equivalent (CMA), in some natural unit (CEA), in multiple natural units (CCA), in derived utilities (CUA), or in monetary units (CBA).

9 Economic Evaluations in Healthcare Each approach is acceptable so long as it is appropriately justified. The ultimate choice will depend on the context and the specific question posed. Gold (1996) the models are not mutually exclusive forms of analysis; the use of one does not exclude the use of another in any one study Furthermore, CUA and CBA can generally be retrospectively applied to CEA with further work. Especially if outcome measures lend themselves to utility assessment (to be valued) In general the majority of evaluations in healthcare are CEA

10 Critical Assessment A guide to critically assessing economic evaluations will give you a sharp appreciation of the most important aspects of evaluations and a sense of the standard that is expected in the literature. We will look at these aspects by asking 10 core questions that will allow you to Recognise well conducted evaluations Assess the validity of the results you encounter Open up a chest of literature on previous evaluations carried out in your field and their utility in your work

11 Checklist for economic evaluation 1. Was a well-defined question posed in an answerable form? A well specified question for example might look as follows: From the viewpoint of (a) both the ministry of health and the ministry of social welfare budgets (b) patients incurring out-ofpocket costs, is treatment X preferable to the existing programme of treatment Z in (i) reducing symptom, (ii) preventing infection, (iii) increasing QALYs, (iv) increasing life years saved, (v) reducing mortality? Bad Questions e.g. Will a community hypertension programme do any good? This solicits the wrong answer. Similarly questions such as How much does it cost to run our intensive care unit? are NOT efficiency questions as they fail to specify the alternatives for comparison. The answers to questions such as these do not themselves qualify as efficiency statements.

12 2. Was a comprehensive description of the competing alternatives given? Were relevant alternatives omitted? Can you tell who did what to whom, where, and how often Was a do-nothing alternative considered? A clear and specific statement of the primary objective of each alternative programme, treatment, or service is critical in appropriately selecting costeffectiveness analysis, cost-utility analysis, or cost benefit analysis (CEA, CUA and CBA, respectively) as the type of evaluation to be undertaken. A full description of the alternatives is essential for three further reasons.

13 2. Comprehensive description of the competing alternatives I 1. Readers must be able to judge the applicability of the programmes to their own settings. 2. Readers should be able to assess for themselves whether any costs or consequences may have been omitted in the analysis 3. Readers may wish to replicate the programme procedures being described.

14 3. Was the effectiveness of the programmes or services established? Was this done through a randomized controlled clinical trial? If so, did the trial protocol reflect what would happen in regular practice?! Were effectiveness data collected and summarised through a systematic overview of clinical studies? If so, were the search strategy and rules for inclusion or outlined? Were observational data or assumptions used to establish effectiveness? If so, what are the potential biases in results?

15 3. Establishing effectiveness of the programme or service We are not interested in an ineffective services, that is, a service which have been shown to do no more good than harm (by themselves, or compared with no treatment). We are not interested in the provision of such services under any other conditions, efficient or otherwise, if something is not worth doing its not worth doing well!! Therefore if the economic evaluation assumes effectiveness some indication of the validation of effectiveness should be given.

16 4. Were all the important and relevant costs and consequences for each alternative identified? Was the range wide enough for the research questions sat hand? Did it cover all relevant viewpoints? Possible viewpoints include the community or social viewpoint, and those of patients and third-party payers. Were capital costs, as well as operating cots, included? Even though it may not be possible or necessary to measure and value all of the costs and consequences of the alternatives under comparison, a full identification of the important and relevant ones should be provided. The combination of information contained in the viewpoint statement and programme description should allow judgement of what specific costs and consequences or outcomes it is appropriate to include in the analysis.

17 5. Were costs and consequences measured accurately in appropriate physical units? Hours of nursing time, number of physician visits, lost work days, gained life years. Were the sources of resource utilization described and justified? Were any of the identified items omitted from the measurement? If so, does this mean that they carried no weight in the subsequent analysis? Were there any special circumstances (for example, joint use of resources) that made measurement difficult? Were these circumstances handled appropriately?

18 5. Identification and appropriate measurement of costs and consequences While identification, measurement and valuation often occur simultaneously in analyses, it is a good practice for users of evaluation results to view each as a separate phase of analysis. Once the important costs and consequences have been identified they must be measures in appropriate physical and natural units. E.g. measurement of the operating costs of a particular screening programme may yield a partial list of ingredients such as 500 physical examinations performed by physicians, 10 weeks of salaried nursing time, 10 weeks of a 1000 square foot clinic, 20 hours of medical research librarian time from an adjoining hospital and so on.. Similarly, costs borne by patients may be measured, by the amount of medication purchased, the number of times travel was required for treatment or time lost from work for treatment.

19 A note on Costs: per unit costs Overhead costs like housekeeping or central administration are allocated to various departments on the basis of some measure judged to be related to usage of the overhead item (e.g., square feet of floor space). Analyst needs to judge how important this cost is an then assign the appropriate effort and care to estimating it accurately. Average per diem cost may often suffice one can improve on this by stripping these costs of their medical component leaving the hotel component of the hospital expenditure for which all patients can be assumed equal so cost can be ascribed on the number of patient-days. Allows for medical care cost to be estimated separately ~ benefit is that these key costs can directly relate to the specific patients in the programme.

20 Levels of precision in hospital costing Most Precise Least precise Micro-costing Each component of resource use (for example, laboratory tests, days of stay by wards, drugs) is estimated and a unit cost derived for each. Case- mix group Gives the cost for each category of case or hospital patient. Takes account of length of stay. Precision depends on the level of detail in specifying the types of cases. Disease- specific per diem( or daily cost) Gives the average daily cost for treatments in each disease category. These may still be quite broad( for example, orthopaedic surgery) Average per diem (or daily cost) Averages the per diem over all categories of patient. Available in most health care systems.

21 Outcomes Examples of effectiveness measures used in CEAs in the published literature: Hypertension ~ mmhg Bp reduction Hypercholesterolemia ~ % serum cholesterol reduction Asthma ~ Episode-free day Thrombolysis ~ Life years gained Some are final, health-related measures of outcome, such as lifeyears gained or episode-free days. Others are expressed as intermediate outcomes, such as percentage cholesterol reduction or cases detected. The most important issue to consider is whether the measure is relevant, given the objectives of the decision maker concerned. As more jurisdiction request economic evaluation as part of the formal decision making process for health technologies, measures that relate to broader objectives, such as maximizing health gain, are becoming most relevant.

22 How does one link intermediate and final outcomes? Although intermediate outcomes may themselves have some value (or clinical meaning), the economic analyst should ideally choose an effectiveness measure relating to a final outcome. In some cases, where the size of the relative risk (for example, of death) comparing individuals with and without the risk factor is large, it may be possible to establish the link through observational or case-control studies. An example here is a link between smoking and lung cancer. However, when undertaking a CEA using effectiveness data relating to an intermediate endpoint the analyst should either Make a case for the intermediate endpoint having value or clinical relevance in its own right Be confident that the link between intermediate and final outcomes has been adequately established by previous research or, Ensure that any uncertainty surrounding the link is adequately characterized in the economic study.

23 6. Were costs and consequences valued credibly? Were the sources of all values clearly identified? (Possible sources include market values, patient or client preferences and views, policymakers views and health professionals judgements.) Were market values employed for changes involving resources gained or depleted? The sources of methods of valuation of costs, benefits and utilities should be clearly stated in the economic evaluation. Costs are normally valued in units of local currency, based on prevailing prices of, for example, personnel, commodities, and services, and can often be taken directly from programme budgets. All current and future programme costs are normally valued in constant Euros of some base year (usually the present), in order to remove effects of inflation from the analysis.

24 7. Were costs and consequences adjusted for differential timing? Were costs and consequences that occur in the future discounted to their present values? Was any justification given in the discount rate used? Because comparison of programmes or services must be made at one point in time (usually the present), the timing of programme costs and consequences that do not occur entirely in the present must be taken into account. Different programmes may have different time profiles of costs and consequences e.g. the primary benefits of the influenza immunization programme are immediate while those of hypertension screening occur well into the future.

25 8. Was an incremental analysis of costs and consequences alternatives performed? Were the additional (incremental) costs generated by one alternative over another compared to the additional effects, benefits or utilities generated? For meaningful comparison, it is necessary to examine the additional coats that one service or programme imposes over another, compared with the additional effects, benefits, or utilities it delivers. Table 3.1 shows the costs and outcomes (in terms of direct diagnoses) generated by two alternative strategies: impendence plethysmography (IPG) alone versus IPG plus outpatient venography if impendence plethysmography is negative.

26 Economic evaluation of alternative diagnostic strategies for 516 patients with clinically suspected deep-vein thrombosis. Programme Cost ($) Outcome (number Of correct diagnoses) 1. IPG (alone) Ratio of cost to outcome ($ per correct diagnoses) 2. IPG plus out patient venography if IPG negative 3. Increment (of programme 2 over programme 1)

27 9. Was allowance made for the uncertainty in the estimates of costs and consequences? If patient level data on costs or consequences were available, were appropriate statistical analyses performed? If sensitivity analysis was employed, was justification provided for the ranges or distributions of values (for hey study parameters), and the form of sensitivity analysis used? Were the conclusions of the study sensitive to the uncertainty in the result, as quantified by the statistical and/or sensitivity analysis?

28 10. Did the presentation and discussion of study results include all issues of concern to users? Were the conclusions of the analysis based on some overall index or ratio of costs to consequences (for example, cost-effectiveness ratio)? If so, was the index interpreted intelligently or in mechanistic fashion? Were the results compared with those of others who have investigated the same question? If so, were allowances made for potential differences in study methodology? Did the study allude to, or take account of, other important factors in the choice or decision under consideration for example, distribution of costs and consequences, or relevant ethical issues?) Did the study discuss issues of implementation, such as the feasibility of adopting the preferred programme given existing financial or other constraints, and whether any freed resources could be redeployed to other worthwhile programmes?

29 How might effectiveness data to be obtained? A major source of effectiveness data is the existing medical literature. Use of such data in economic evaluation raise three issues Quality Relevance Comprehensiveness

30 Assessing medical literature A full discussion of appraising the quality of medical evidence is beyond the scope of this talk.. generally, economists support the quality criteria laid down by clinical epidemiologists for clinicians seeking evidence to support clinical recommendations. It is rare for the data on clinical outcomes used in economic evaluations to be drawn solely from clinical trials. In judging the relevance of results published in the literature, one would have to consider how close one s own situation is to those where the published clinical studies were conducted. Important factors to consider are the patient case-load, the expertise of medical and other staff, and the existence of back-up facilities. The third criterion for judging effectiveness evidence in economic evaluation is comprehensiveness. That is, are the clinical data used in the economic evaluation representative of the medical literature as a whole?

31 Nowadays, many more economic evaluations use data from a review of clinical trials and well-conducted synthesis of available data. Finally, in situations where no good clinical evidence exists, the cost effectiveness analysts may proceed by making assumptions about the clinical evidence and then undertaking a sensitivity analysis of the economic results to different assumptions. The underlying logic is that if the final result is not sensitive to the estimate used for a given variable, then it is not worth much effort to obtain a more accurate estimate.

32 Note: Evaluations cost money themselves! They should be carried out efficiently. Costing can take considerable time and effort and one shouldn t make the perfect the enemy of good. Therefore, analysts need to make judgements on how accurate (or precise) cost estimates need to be within a given study. In general, the analyst will need to judge the importance of different costs and consequences in the overall scheme and work accordingly; any important assumptions made should be included in the discussion.