An empiric estimate of the value of life: updating the renal dialysis cost-effectiveness standard

The cost-utility of haemodiafiltration versus haemodialysis in the Convective Transport Study

BACKGROUND

Despite the growing interest in haemodiafiltration (HDF), there is no information on the costs and cost-utility of this dialysis modality yet. It was therefore our objective to study the cost-utility of HDF versus haemodialysis (HD).

METHODS

A cost-utility analysis was performed using a Markov model. It included data from the Convective Transport Study (CONTRAST), a randomized controlled trial that compared online HDF with low-flux HD. Costs were estimated using a societal perspective. Probabilistic sensitivity analyses were performed to study uncertainty.

RESULTS

Total annual costs for HDF and HD were €88 622±19,272 and €86,086±15,945, respectively (in 2009 euros). When modelled over a 5-year period, the incremental cost per quality-adjusted life year (QALY) of HDF versus HD was €287,679. Sensitivity analyses revealed that this amount will not fall below €140,000, even under the most favourable assumptions like a high-convection volume (>20.3 L).

CONCLUSIONS

Based on accepted societal willingness-to-pay thresholds, HDF cannot be considered a cost-effective treatment for patients with end-stage renal disease at present. Apparently, minor additional costs of HDF are not counterbalanced by a relevant QALY gain.

The price of drugs for chronic myeloid leukemia (CML) is a reflection of the unsustainable prices of cancer drugs: from the perspective of a large group of CML experts

As a group of more than 100 experts in chronic myeloid leukemia (CML), we draw attention to the high prices of cancer drugs, with the particular focus on the prices of approved tyrosine kinase inhibitors for the treatment of CML. This editorial addresses the multiple factors involved in cancer drug pricing and their impact on individual patients and health care policies, and argues for the need to (1) lower the prices of cancer drugs to allow more patients to afford them and (2) maintain sound long-term health care policies.

The coming fiscal crisis: nephrology in the line of fire

Nephrologists in the United States face a very uncertain economic future. The astronomical federal debt and unfunded liability burden of Medicare combined with the aging population will place unprecedented strain on the health care sector. To address these fundamental problems, it is conceivable that the federal government will ultimately institute rationing and other budget-cutting measures to rein in costs of ESRD care, which is generously funded relative to other chronic illnesses. Therefore, nephrologists should expect implementation of cost-cutting measures, such age-based rationing, mandated delayed dialysis and home therapies, compensated organ donation, and a shift in research priorities from the dialysis to the predialysis patient population. Nephrologists also need to recognize that these changes, which are geared toward the population level, may make it more difficult to advocate effectively for the needs of individual patients.

The cost-effectiveness of expanded HIV screening in the United States

OBJECTIVE

The current Centers of Disease Control and Prevention (CDC) guidelines from 2006 recommend a one-time test for low-risk individuals and annual testing for those at high risk. These guidelines may not be aggressive enough, even for those at low risk of infection, due to the earlier initiation of HAART and a movement towards a test-and-treat environment. We evaluated the optimal testing frequencies for various risk groups in comparison to the CDC recommendations.

METHODS

We build a deterministic mathematical model optimizing the tradeoff between the societal cost of testing and the benefits over a patient's lifetime of earlier diagnosis.

RESULTS

Under a test-and-treat scenario with immediate initiation of HAART, the optimal testing frequency is every 2.4 years for low-risk (0.01% annual incidence) individuals; every 9 months for moderate risk (0.1% incidence) individuals; and every 3 months for high-risk (1.0% incidence) individuals. The incremental cost-effectiveness of the optimal policy is $ 36 ,342/quality-adjusted life-years (QALY) for low-risk individuals and $ 45 ,074/QALY for high-risk individuals compared with 20-year and annual testing, respectively.

CONCLUSION

The current CDC guidelines for HIV testing are too conservative, and more frequent testing is cost-effective for all risk groups.

Maintenance chemotherapy for advanced non-small-cell lung cancer: new life for an old idea

Although well established for the treatment of certain hematologic malignancies, maintenance therapy has only recently become a treatment paradigm for advanced non-small-cell lung cancer. Maintenance therapy, which is designed to prolong a clinically favorable state after completion of a predefined number of induction chemotherapy cycles, has two principal paradigms. Continuation maintenance therapy entails the ongoing administration of a component of the initial chemotherapy regimen, generally the nonplatinum cytotoxic drug or a molecular targeted agent. With switch maintenance (also known as sequential therapy), a new and potentially non-cross-resistant agent is introduced immediately on completion of first-line chemotherapy. Potential rationales for maintenance therapy include increased exposure to effective therapies, decreasing chemotherapy resistance, optimizing efficacy of chemotherapeutic agents, antiangiogenic effects, and altering antitumor immunity. To date, switch maintenance therapy strategies with pemetrexed and erlotinib have demonstrated improved overall survival, resulting in US Food and Drug Administration approval for this indication. Recently, continuation maintenance with pemetrexed was found to prolong overall survival as well. Factors predicting benefit from maintenance chemotherapy include the degree of response to first-line therapy, performance status, the likelihood of receiving further therapy at the time of progression, and tumor histology and molecular characteristics. Several aspects of maintenance therapy have raised considerable debate in the thoracic oncology community, including clinical trial end points, the prevalence of second-line chemotherapy administration, the role of treatment-free intervals, quality of life, economic considerations, and whether progression-free survival is a worthy therapeutic goal in this disease setting.

Cost-effectiveness analysis evaluating fidaxomicin versus oral vancomycin for the treatment of Clostridium difficile infection in the United States

OBJECTIVES

Fidaxomicin is a novel treatment for Clostridium difficile infections (CDIs). This new treatment, however, is associated with a higher acquisition cost compared with alternatives. The objective of this study was to evaluate the cost-effectiveness of fidaxomicin or oral vancomycin for the treatment of CDIs.

METHODS

We performed a cost-utility analysis comparing fidaxomicin with oral vancomycin for the treatment of CDIs in the United States by creating a decision analytic model from the third-party payer perspective.

RESULTS

The incremental cost-effectiveness ratio with fidaxomicin compared with oral vancomycin was $67,576/quality-adjusted life-year. A probabilistic Monte Carlo sensitivity analysis showed that fidaxomicin had an 80.2% chance of being cost-effective at a willingness-to-pay threshold of $100,000/quality-adjusted life-year. Fidaxomicin remained cost-effective under all fluctuations of both fidaxomicin and oral vancomycin costs. The decision analytic model was sensitive to variations in clinical cure and recurrence rates. Secondary analyses revealed that fidaxomicin was cost-effective in patients receiving concominant antimicrobials, in patients with mild to moderate CDIs, and when compared with oral metronidazole in patients with mild to moderate disease. Fidaxomicin was dominated by oral vancomycin if CDI was caused by the NAP1/Bl/027 Clostridium difficile strain and was dominant in institutions that did not compound oral vancomycin.

CONCLUSION

Results of our model showed that fidaxomicin may be a more cost-effective option for the treatment of CDIs when compared with oral vancomycin under most scenarios tested.

Cost-effectiveness of gene-expression profiling for tumor-site origin

OBJECTIVES

Gene-expression profiling (GEP) reliably supplements traditional clinicopathological information on the tissue of origin (TOO) in metastatic or poorly differentiated cancer. A cost-effectiveness analysis of GEP TOO testing versus usual care was conducted from a US third-party payer perspective.

METHODS

Data on recommendation changes for chemotherapy, surgery, radiation therapy, blood tests, imaging investigations, and hospice care were obtained from a retrospective, observational study of patients whose physicians received GEP TOO test results. The effects of chemotherapy recommendation changes on survival were based on the results of trials cited in National Comprehensive Cancer Network and UpToDate guidelines. Drug and administration costs were based on average doses reported in National Comprehensive Cancer Network guidelines. Other unit costs came from Centers for Medicare & Medicaid Services fee schedules. Quality-of-life weights were obtained from literature. Bootstrap analysis estimated sample variability; probabilistic sensitivity analysis addressed parameter uncertainty.

RESULTS

Chemotherapy regimen recommendations consistent with guidelines for final tumor-site diagnoses increased significantly from 42% to 65% (net difference 23%; P<0.001). Projected overall survival increased from 15.9 to 19.5 months (mean difference 3.6 months; two-sided 95% confidence interval [CI] 3.2-3.9). The average increase in quality-adjusted life-months was 2.7 months (95% CI 1.5-4.3), and average third-party payer costs per patient increased by $10,360 (95% CI $2,982-$19,192). The cost per quality-adjusted life-year gained was $46,858 (95% CI $13,351-$104,269).

CONCLUSIONS

GEP TOO testing significantly altered clinical practice patterns and is projected to increase overall survival, quality-adjusted life-years, and costs, resulting in an expected cost per quality-adjusted life-year of less than $50,000.

Cost-effectiveness analysis of therapies for chronic kidney disease patients on dialysis: a case for excluding dialysis costs

In many jurisdictions, cost-effectiveness analysis (CEA) plays an important role in determining drug coverage and reimbursement and, therefore, has the potential to impact patient access. Health economic guidelines recommend the inclusion of future costs related to the intervention of interest within CEAs but provide little guidance regarding the definition of 'related'. In the case of CEAs of therapies that extend the lives of patients with chronic kidney disease (CKD) on dialysis but do not impact the need for or the intensity of dialysis, the determination of the relatedness of future dialysis costs to the therapy of interest is particularly ambiguous. The uncertainty as to whether dialysis costs are related or unrelated in these circumstances has led to inconsistencies in the conduct of CEAs for such products, with dialysis costs included in some analyses while excluded in others. Due to the magnitude of the cost of dialysis, whether or not dialysis costs are included in CEAs of such therapies has substantial implications for the results of such analyses, often meaning the difference between a therapy being deemed cost effective (in instances where dialysis costs are excluded) or not cost effective (in instances where dialysis costs are included). This paper explores the issues and implications surrounding the inclusion of dialysis costs in CEAs of therapies that extend the lives of dialysis patients but do not impact the need for dialysis. Relevant case studies clearly demonstrate that, regardless of the clinical benefits of a life-extending intervention for dialysis patients, and due to the high cost of dialysis, the inclusion of dialysis costs in the analysis essentially eliminates the possibility of obtaining a favourable cost-effectiveness ratio. This raises the significant risk that dialysis patients may be denied access to interventions that are cost effective in other populations due solely to the high background cost of dialysis itself. Finally, the paper presents a case for excluding dialysis costs in CEAs of therapies that extend the lives of patients receiving dialysis but do not impact the need for dialysis. The argument is founded on the following: (i) health economic guidelines imply that dialysis costs are unrelated to such therapies and therefore should not be included in CEAs of such therapies; (ii) the high cost and cost-effectiveness ratio associated with dialysis place an unreasonable and insurmountable barrier to demonstrating the cost effectiveness of such therapies, particularly since the decision to fund dialysis has already been made; and (iii) current clinical and reimbursement practices include the use of such therapies for patients with CKD receiving dialysis. We conclude that the exclusion of dialysis costs in such cases is methodologically correct given current health economic guidelines and is consistent with current practices regarding the treatment of dialysis patients.

Is reconstruction nailing of all femoral shaft fractures cost effective? A decision analysis

OBJECTIVES

Femoral shaft fractures are usually treated with anterograde or retrograde nails that typically do not provide femoral neck fixation. Ipsilateral femoral neck fractures occur with 2.5%-10% of femoral shaft fractures; 19%-55% of associated femoral neck fractures are missed with plain films and 5%-22% with computed tomography (CT). This study was performed to determine if routine reconstruction nailing of all femoral shaft fractures with or without occult femoral neck fractures is cost effective.

METHODS

A decision tree model examined the cost effectiveness of reconstruction nailing over standard intramedullary nailing for all femoral shaft fractures in which an associated femoral neck fracture was not identified on plain radiographs. As a base model, we assumed that 5% of shaft fractures had an ipsilateral femoral neck fracture, and 37% were missed and required further surgery. We assigned a small morbidity and additional cost ($680) for the use of a reconstruction nail and 2 screws. Model inputs including costs, clinical outcome probabilities, and health utilities were derived from the literature, estimated from institutional data, or assumed by the authors. Sensitivity analyses evaluated the effect of the rate of associated femoral neck fracture, the rate of missed femoral neck fracture, the complication rate of reconstruction screws, the cost of the extra reconstruction screws, and the utilities of each outcome on the incremental cost effectiveness (ICER) of both strategies. Current practice in cost-effectiveness analysis uses a threshold of $100,000 per quality-adjusted life year gained as cost effective. A secondary analysis of the use CT scans to reduce missed femoral neck fractures was also performed.

RESULTS

The base model showed that the placement of reconstruction nails in all isolated femur fractures was not cost effective. Sensitivity analysis demonstrated that the ICER was most sensitive to the cost of the reconstruction nail, hemiarthroplasty, and a missed femoral neck fracture. The ICER was affected by the rate of femoral neck fracture and the rate of missed femoral neck fracture. If the rate of missed femoral neck fractures was >38%, then reconstruction nailing was a cost-effective strategy. If the probability of an ipsilateral femoral neck fracture was >7%, then reconstruction nailing was cost effective. Protocolized CT scans had an ICER >$100,000. If the additional cost of the reconstruction nails was <$650, then it was cost effective to perform reconstruction nailing for all femoral shaft fractures.

CONCLUSIONS

Reconstruction nailing of femoral shaft fractures can be a cost-effective method to reduce the risks and morbidity of missed femoral neck fractures if the incremental implant costs are <$650. Routine reconstruction nailing is cost effective if the rate of associated femoral neck fracture is >7% or the rate of missed femoral neck fracture is >38%. CT scans are not a cost-effective strategy to reduce the risk and morbidity of missed femoral neck fractures if the cost is >$243. Weaknesses of this study include the reliance on low-powered studies and on estimations of some utilities and costs. To prevent the morbidity of missed or occult femoral neck fractures, the use of reconstruction nails for femoral shaft fractures is cost effective when the incremental costs of implants are <$650.

LEVEL OF EVIDENCE

Economic Level II. See Instructions for Authors for a complete description of levels of evidence.

Saving Money or Just Saving Lives? Improving the Productivity of US Health Care Spending

There is growing concern over the rising share of the US economy devoted to health care spending. Fueled in part by demographic transitions, unchecked increases in entitlement spending will necessitate some combination of substantial tax increases, elimination of other public spending, or unsustainable public debt. This massive increase in health spending might be warranted if each dollar devoted to the health care sector yielded real health benefits, but this does not seem to be the case. Although we have seen remarkable gains in life expectancy and functioning over the past several decades, there is substantial variation in the health benefits associated with different types of spending. Some treatments, such as aspirin, beta blockers, and flu shots, produce a large health benefit per dollar spent. Other more expensive treatments, such as stents for cardiovascular disease, are high value for some patients but poor value for others. Finally, a large and expanding set of treatments, such as proton-beam therapy or robotic surgery, contributes to rapid increases in spending despite questionable health benefits. Moving resources toward more productive uses requires encouraging providers to deliver and patients to consume high-value care, a daunting task in the current political landscape. But widespread inefficiency also offers hope: Given the current distribution of resources in the US health care system, there is tremendous potential to improve the productivity of health care spending and the fiscal health of the United States.

Helicobacter pylori in First Nations and recent immigrant populations in Canada

The diminishing prevalence of Helicobacter pylori infection among most segments of the Canadian population has led to changes in the etiologies and patterns of associated upper gastrointestinal diseases, including fewer peptic ulcers and their complications. Canadian Aboriginals and recent immigrants are among populations in which the prevalence of H pylori infection remains high and, therefore, the health risks imposed by H pylori remain a significant concern. Population-based strategies for H pylori eradication in groups with a low prevalence of infection are unlikely to be cost effective, but such measures are attractive in groups in which the prevalence rates of infection remain substantial. In addition to a lower prevalence of peptic ulcers and dyspepsia, the public health value of eradication may be particularly important if this leads to a reduction in the prevalence of gastric cancer in high prevalence groups. Therefore The Canadian Helicobacter Study Group held a conference that brought together experts in the field to address these issues, the results of which are reviewed in the present article. Canadians with the highest prevalence of H pylori infection are an appropriate focus for considering the health advantages of eradicating persistent infection. In Canadian communities with a high prevalence of both H pylori and gastric cancer, there remains an opportunity to test the hypothesis that H pylori infection is a treatable risk factor for malignancy.

Understanding health economic analysis in critical care: insights from recent randomized controlled trials

PURPOSE OF REVIEW

The article reviews the methods of health economic analysis (HEA) in clinical trials of critically ill patients. Emphasis is placed on the usefulness of HEA in the context of positive and 'no effect' studies, with recent examples.

RECENT FINDINGS

The need to control costs and promote effective spending in caring for the critically ill has garnered considerable attention due to the high cost of critical illness. Many clinical trials focus on short-term mortality, ignoring costs and quality of life, and fail to change clinical practice or promote efficient use of resources. Incorporating HEA into clinical trials is a possible solution. Such studies have shown some interventions, although expensive, provide good value, whereas others should be withdrawn from clinical practice. Incorporating HEA into randomized controlled trials (RCTs) requires careful attention to collect all relevant costs. Decision trees, modeling assumptions and methods for collecting costs and measuring outcomes should be planned and published beforehand to minimize bias.

SUMMARY

Costs and cost-effectiveness are potentially useful outcomes in RCTs of critically ill patients. Future RCTs should incorporate parallel HEA to provide both economic outcomes, which are important to the community, alongside patient-centered outcomes, which are important to individuals.

Play or pay: a financial model for trauma care in a regional trauma system

BACKGROUND

Trauma systems are threatened from declining reimbursement. To increase trauma system participation in Mississippi, a novel "Play or Pay" (PoP) state trauma funding law went into effect on September 1, 2008. Hospitals were required to participate in the trauma system or pay a fee of up to $1.5 million per year. Funds generated are distributed for uncompensated care to hospitals participating in the trauma system. The purpose of this study was to evaluate the effect of PoP on a bordering state's Level I trauma center.

METHODS

Patients living in the PoP state at the time of injury who were admitted to a regional Level I trauma center from 2006 to 2009 were eligible. Demographics, payer source, and injury severity were determined. The reimbursement ratio (reimbursement or charges) (REIMBR) was calculated for each patient. Patients admitted before PoP (PRE) were compared with those admitted after (POST).

RESULTS

Trauma system participation increased in the PoP state PRE (70 of 107 [65%]) versus POST (85 of 106 [80%], p < 0.05). Transfers of Mississippi residents from referring hospitals to the regional Level I trauma center increased PRE (30.0%) versus POST (36.8%, p < 0.05). Payer mix was significantly different PRE versus POST with an increase in self-pay (37.4% POST vs. 36.5% PRE, p < 0.05) and a decrease in commercial insurance (36.0% POST vs. 41.0% PRE, p < 0.05). The REIMBR significantly decreased PRE (1.11 ± 1.43) compared with POST (0.91 ± 1.07, p < 0.05). At the same time, there was an increase in funds received from the PoP state. After accounting for increased funds, there was a significant increase in the adjusted REIMBR PRE (1.21 ± 1.53) versus POST (1.49 ± 4.51, p < 0.05).

CONCLUSIONS

A PoP policy in a neighboring state was associated with more transfers, a change in payer mix, and a decrease in the REIMBR. However, funds received from the PoP state ameliorated the negative financial impact on bordering state's Level I trauma center. The Mississippi legislature's foresighted PoP policy created a truly regional trauma system, blind to state lines.

Rationing in urologic oncology: lessons from sipuleucel-T for advanced prostate cancer

OBJECTIVES

As complex novel cancer drugs are developed, supply may transiently fail to meet demand as production capacity established for research purposes is scaled up to meet anticipated clinical volume. There are no clear guidelines for how clinicians and medical centers should allocate scarce cancer care resources among patients who may benefit from the intervention.

MATERIALS AND METHODS

We describe a recent scenario in which demand exceeded supply for a novel immunotherapy, sipuleucel-T, that was newly approved by the FDA for castration-resistant prostate cancer. Production of this autologous cellular therapy was initially limited to one facility with supply projected to serve only 2,000 out of approximately 30,000 potentially eligible patients in the United States.

RESULTS AND CONCLUSIONS

We propose basic guidelines that should be followed when allocating scarce cancer therapies and highlight ongoing challenges that must be resolved both with regard to rationing cancer care and with regard to access to high cost novel interventions in oncology in general.

Cost-benefit estimation of cadaveric kidney transplantation: the case of a developing country

BACKGROUND

In this paper we have estimated the cost savings for the health care system and quality-of-life improvement for patients from an increased number of kidney transplants in Chile. We compared the present value of dialysis and transplantation costs and quality of life over a 20-year horizon.

METHODS

We used Markov models and introduced some degree of uncertainty in the value of some of the parameters that built the model. Using Monte Carlo simulations, we estimated the confidence intervals for our results.

RESULTS

Our estimates suggested that a kidney transplant showed an expected savings value of US$28,000 for the health care system. If the quality-of-life improvement was also considered, the expected savings rise to US$ 102,000. These results imply that increasing donation rate by 1 donor per million population would achieve an estimated cost saving of US$827,000 per year, or near US$3 million per year considering the effect on the quality of life.

CONCLUSION

These results demonstrated that kidney transplantation along with a better quality of life for patients are a cost-saving decision for developing countries.

Cost-effectiveness of denosumab vs zoledronic acid for prevention of skeletal-related events in patients with solid tumors and bone metastases in the United States

OBJECTIVE

With increasing healthcare resource constraints, it has become important to understand the incremental cost-effectiveness of new medicines. Subcutaneous denosumab is superior to intravenous zoledronic acid (ZA) for the prevention of skeletal-related events (SREs) in patients with advanced solid tumors and bone metastases. This study sought to determine the lifetime cost-effectiveness of denosumab vs ZA in this setting, from a US managed-care perspective.

METHODS

A lifetime Markov model was developed, with relative rate reductions in SREs for denosumab vs ZA derived from three pivotal Phase 3 trials involving patients with castration-resistant prostate cancer (CRPC), breast cancer, and non-small-cell lung cancer (NSCLC), and bone metastases. The real-world SRE rates in ZA-treated patients were derived from a large commercial database. SRE and treatment administration quality-adjusted life year (QALY) decrements were estimated with time-trade-off studies. SRE costs were estimated from a nationally representative commercial claims database. Drug, drug administration, and renal monitoring costs were included. Costs and QALYs were discounted at 3% annually. One-way and probabilistic sensitivity analyses were conducted.

RESULTS

Across tumor types, denosumab was associated with a reduced number of SREs, increased QALYs, and increased lifetime total costs vs ZA. The costs per QALY gained for denosumab vs ZA in CRPC, breast cancer, and NSCLC were $49,405, $78,915, and $67,931, respectively, commonly considered good value in the US. Costs per SRE avoided were $8567, $13,557, and $10,513, respectively. Results were sensitive to drug costs and SRE rates.

LIMITATIONS

Differences in pain severity and analgesic use favoring denosumab over ZA were not captured. Mortality was extrapolated from fitted generalized gamma function beyond the trial duration.

CONCLUSION

Denosumab is a cost-effective treatment option for the prevention of SREs in patients with advanced solid tumors and bone metastases compared to ZA. The overall value of denosumab is based on superior efficacy, favorable safety, and more efficient administration.

Historical clinical and economic consequences of anemia management in patients with end-stage renal disease on dialysis using erythropoietin stimulating agents versus routine blood transfusions: a retrospective cost-effectiveness analysis

OBJECTIVE

To determine whether Medicare's decision to cover routine administration of erythropoietin stimulating agents (ESAs) to treat anemia of end-stage renal disease (ESRD) has been a cost-effective policy relative to standard of care at the time.

METHODS

The authors used summary statistics from the actual cohort of ESRD patients receiving ESAs between 1995 and 2004 to create a simulated patient cohort, which was compared with a comparable simulated cohort assumed to rely solely on blood transfusions. Outcomes modeled from the Medicare perspective included estimated treatment costs, life-years gained, and quality-adjusted life-years (QALYs). Incremental cost-effectiveness ratio (ICER) was calculated relative to the hypothetical reference case of no ESA use in the transfusion cohort. Sensitivity of the results to model assumptions was tested using one-way and probabilistic sensitivity analyses.

RESULTS

Estimated total costs incurred by the ESRD population were $155.47B for the cohort receiving ESAs and $155.22B for the cohort receiving routine blood transfusions. Estimated QALYs were 2.56M and 2.29M, respectively, for the two groups. The ICER of ESAs compared to routine blood transfusions was estimated as $873 per QALY gained. The model was sensitive to a number of parameters according to one-way and probabilistic sensitivity analyses.

LIMITATIONS

This model was counter-factual as the actual comparison group, whose anemia was managed via transfusion and iron supplements, rapidly disappeared following introduction of ESAs. In addition, a large number of model parameters were obtained from observational studies due to the lack of randomized trial evidence in the literature.

CONCLUSIONS

This study indicates that Medicare's coverage of ESAs appears to have been cost effective based on commonly accepted levels of willingness-to-pay. The ESRD population achieved substantial clinical benefit at a reasonable cost to society.

An economic analysis of dose dense weekly paclitaxel plus carboplatin versus every-3-week paclitaxel plus carboplatin in the treatment of advanced ovarian cancer

OBJECTIVE

Compared with every-3-week paclitaxel (q3T) plus carboplatin, dose-dense weekly paclitaxel (ddT) plus carboplatin improved the survival of ovarian cancer patients. We performed a cost analysis comparing these two regimens.

METHODS

Using a Markov decision model, an acceptable incremental cost-effectiveness ratio (ICER) per progression-free life-year saved (PFLYS) was estimated. Cost of drugs, growth colony-stimulating factors, and transfusions were derived from Medicare reimbursement data. Survival and rates of complications were estimated based on the clinical trial.

RESULTS

Using a body weight and surface area of an average woman age 63, the estimated cost per cycle of ddT was $107 vs. $80 for q3T. The costs per cycle of combination chemotherapy including treatment administration were $873 for ddT and $535 for q3T. With a median progression-free survival (PFS) of 28 months with ddT vs. 17.2 months with q3T, the ICER was $5809 per PFLYS for ddT compared with q3T arm. Using a maximum ICER of $100,000 per LYS as cost-effective threshold, the ddT regimen was cost-effective. The ICER was most sensitive to the hazard rate for difference in PFS between the two regimens. A 4-month difference in PFS resulted in a $1200 change of ICER per PFLYS. The ICER was also sensitive to overall survival difference, rate of hematological toxicity, and rate of discontinuation.

CONCLUSIONS

In this economic model, dose-dense weekly paclitaxel is a cost-effective treatment option for advanced ovarian cancer.

A review of the costs and cost effectiveness of interventions in chronic kidney disease: implications for policy

Given rising healthcare costs and a growing population of patients with chronic kidney disease (CKD), there is an urgent need to identify health interventions that provide good value for money. For this review, the English-language literature was searched for studies of interventions in CKD reporting an original incremental cost-utility (cost per QALY) or cost-effectiveness (cost per life-year) ratio. Published cost studies that did not report cost-effectiveness or cost-utility ratios were also reviewed. League tables were then created for both cost-utility and cost-effectiveness ratios to assess interventions in patients with stage 1-4 CKD, waitlist and transplant patients and those with end-stage renal disease (ESRD). In addition, the percentage of cost-saving or dominant interventions (those that save money and improve health) was compared across these three disease categories. A total of 84 studies were included, contributing 72 cost-utility ratios, 20 cost-effectiveness ratios and 42 other cost measures. Many of the interventions were dominant over the comparator, indicating better health outcomes and lower costs. For the three disease categories, the greatest number of dominant or cost-saving interventions was reported for stage 1-4 CKD patients, followed by waitlist and transplant recipients and those with ESRD (91%, 87% and 55% of studies reporting a dominant or cost-saving intervention, respectively). There is evidence of opportunities to lower costs in the treatment of patients with CKD, while either improving or maintaining the quality of care. In order to realize these cost savings, efforts will be required to promote and effectively implement changes in treatment practices.

Provision and quality of dialysis services in Libya

Dialysis is entirely funded by the public health care sector in Libya. Access to treatment is unrestricted for citizens but there is a lack of local information and no renal registry to gather national data. This cross-sectional study aimed to investigate dialysis provision and practice in Libyan dialysis facilities in 2009. A structured interview regarding dialysis capacity, staffing and methods of assessment of dialysis patients, and infection control measures was conducted with the medical directors of all 40 dialysis centers and 28 centers were visited. A total of 2417 adult patients were receiving maintenance dialysis in 40 centers, giving a population prevalence of approximately 624 per million. Most dialysis units were located in the northern part of the country and only 12.5% were free-standing units. Only three centers offered peritoneal dialysis. One hundred ninety-two hemodialysis rooms hosted 713 functioning hemodialysis stations, giving a ratio of one machine to 3.4 patients. Around half of centers operated only two dialysis shifts per day. Nephrologist/internist to patient ratio was 1:40 and nurse to patient ratio was 1:3.7. We found a wide variation in monitoring of dialysis patients, with dialysis adequacy assessed only in a minority. Separate rooms were allocated for chronic viral infection seropositive patients in 92.5% of the units. In general, the provision of dialysis is adequate but several areas for improvement have been identified, including a need for implementation of guidelines, recruitment of more nephrologists, and the development of more cost-effective alternatives such as peritoneal dialysis and transplantation.

Costs and ethical issues related to first-line treatment of metastatic non-small-cell lung cancer: considerations from a public healthcare system perspective

Metastatic non-small-cell lung cancer is generally not considered to be curable, and the overall 5-year survival rate is less than 1%. Despite this poor prognosis, palliative chemotherapy can increase time and quality of life in the advanced-disease setting. New chemotherapy treatments and targeted therapies are available for this stage of disease, but their high costs are an important issue. In this perspective article, we discuss the hospital costs of antitumor drug administration and the ethical principles involved, the roles of drug agencies and oncologists, and relevant current research on these topics. These considerations have been examined from the perspective of a national public healthcare system.

If substance use disorder treatment more than offsets its costs, why don't more medical centers want to provide it? A budget impact analysis in the Veterans Health Administration

Given that many studies have reported that the costs of substance use disorder (SUD) treatment are more than offset by other savings (e.g., in health care, in criminal justice, in foster care), why haven't health care system managers rushed to expand treatment? This article attempts to explain this puzzling discrepancy by analyzing 1998-2006 data from the national Veterans Affairs (VA) health care system. The main outcome measures were annual cost and utilization for VA SUD-diagnosed patients. The key independent variable was the medical centers' annual spending for SUD treatment. There was no evidence that SUD spending was associated with lower medical center costs over time within the medical center that paid for the treatment. Health care system managers may not be influenced by research suggesting that the costs of SUD treatment are more than fully offset because they bear the cost of providing treatment while the savings largely accrue to other systems.

Estimating the unknown parameters of the natural history of metachronous colorectal cancer using discrete-event simulation

OBJECTIVES

Some aspects of the natural history of metachronous colorectal cancer (MCRC), such as the rate of progression from adenomatous polyp to MCRC, are unknown. The objective of this study is to estimate a set of parameters revealing some of these unknown characteristics of MCRC.

METHODS

The authors developed a computer simulation model that mimics the progression of MCRC for a 5-year period following the treatment of primary colorectal cancer (CRC). They obtained the inputs of the simulation model using longitudinal data for 284 CRC patients from the Mayo Clinic, Rochester.

RESULTS

Five-year MCRC incidence and all-cause mortality were 7.4% and 12.7% in the patient cohort, respectively. Statistical analysis showed that 5-year MCRC incidence was associated with gender (P = 0.05), whereas both all-cause and CRC-related mortalities were associated with age (P < 0.001 and P = 0.01). Estimated annual probabilities of progression from adenomatous polyp to MCRC and from MCRC to metastatic MCRC were 0.14 and 0.28, respectively. Annual probabilities of mortality after MCRC and metastatic MCRC treatments were estimated to be 0.06 and 0.26, respectively. The estimated annual probability of mortality due to undetected MCRC was 0.16.

CONCLUSIONS

The results imply that MCRC, especially in women, may be more common than suggested by previous studies. In addition, statistics derived from the clinical data and results of the simulation model indicate that gender and age affect the progression of MCRC.

Early antiretroviral therapy for patients with acute aids-related opportunistic infections: a cost-effectiveness analysis of ACTG A5164

PURPOSE

ACTG A5164 demonstrated that early antiretroviral therapy (ART) in HIV-infected patients with acute opportunistic infections (OIs) reduced death and AIDS progression compared to ART initiation 1 month later. We project the life expectancies, costs, and incremental cost-effectiveness ratios (ICERs) of these strategies.

METHOD

using an HIV simulation model, we compared 2 strategies for patients with acute OIs: (1) an intervention to deliver early ART, and (2) deferred ART. Parameters from ACTG A5164 included initial mean CD4 count (47/microL), linkage to outpatient care (87%), and immune reconstitution inflammatory syndrome 1 month after ART initiation (7%). The estimated intervention cost was $1,650/patient.

RESULTS

early ART lowered projected 1-year mortality from 10.4% to 8.2% and increased life expectancy from 10.07 to 10.39 quality-adjusted life-years (QALYs). Lifetime costs increased from $385,220 with deferred ART to $397,500 with early ART, primarily because life expectancy increased, producing an ICER of $38,600/QALY. Results were most sensitive to increased intervention cost and decreased virologic efficacy in the early ART strategy.

CONCLUSIONS

an intervention to initiate ART early in patients with acute OIs improves survival and meets US cost-effectiveness thresholds. Programs should be developed to implement this strategy at sites where HIV-infected patients present with OIs.

The pragmatist's guide to comparative effectiveness research

Following an acrimonious health care reform debate involving charges of "death panels," in 2010, Congress explicitly forbade the use of cost-effectiveness analysis in government programs of the Patient Protection and Affordable Care Act. In this context, comparative effectiveness research emerged as an alternative strategy to understand better what works in health care. Put simply, comparative effectiveness research compares the efficacy of two or more diagnostic tests, treatments, or health care delivery methods without any explicit consideration of costs. To economists, the omission of costs from an assessment might seem nonsensical, but we argue that comparative effectiveness research still holds promise. First, it sidesteps one problem facing cost-effectiveness analysis--the widespread political resistance to the idea of using prices in health care. Second, there is little or no evidence on comparative effectiveness for a vast array of treatments: for example, we don't know whether proton-beam therapy, a very expensive treatment for prostate cancer (which requires building a cyclotron and a facility the size of a football field) offers any advantage over conventional approaches. Most drug studies compare new drugs to placebos, rather than "head-to-head" with other drugs on the market, leaving a vacuum as to which drug works best. Finally, the comparative effectiveness research can prove a useful first step even in the absence of cost information if it provides key estimates of treatment effects. After all, such effects are typically expensive to determine and require years or even decades of data. Costs are much easier to measure, and can be appended at a later date as financial Armageddon draws closer.

The value of trauma center care

BACKGROUND

The cost of trauma center care is high, raising questions about the value of a regionalized approach to trauma care. To address these concerns, we estimate 1-year and lifetime treatment costs and measure the cost-effectiveness of treatment at a Level I trauma center (TC) compared with a nontrauma center hospital (NTC).

METHODS

Estimates of cost-effectiveness were derived using data on 5,043 major trauma patients enrolled in the National Study on Costs and Outcomes of Trauma, a prospective cohort study of severely injured adult patients cared for in 69 hospitals in 14 states. Data on costs were derived from multiple sources including claims data from the Centers for Medicare and Medicaid Services, UB92 hospital bills, and patient interviews. Cost-effectiveness was estimated as the ratio of the difference in costs (for treatment at a TC vs. NTC) divided by the difference in life years gained (and lives saved). We also measured cost-effectiveness per quality-adjusted life year gained where quality of life was measured using the SF-6D. We used inverse probability of treatment weighting to adjust for observable differences between patients treated at TCs and NTCs.

RESULTS

The added cost for treatment at a TC versus NTC was $36,319 per life-year gained ($790,931 per life saved) and $36,961 per quality-adjusted life years gained. Cost-effectiveness was more favorable for patients with injuries of higher versus lower severity and for younger versus older patients.

CONCLUSIONS

Our findings provide evidence that regionalization of trauma care is not only effective but also it is cost-effective.

Assessing willingness to pay for cancer prevention

Cancer is the second leading cause of death in the U.S. and its economic cost is very high. The objective of this study is to analyze the socioeconomic and demographic factors that are related to the willingness to pay (WTP) for cancer prevention. Data from an experimental module in the 2002 Health and Retirement Study (HRS) were used to identify WTP differences across different population subgroups. Respondents were asked whether they were willing and able to pay different dollar amounts per month for a new cancer prevention drug. Years of age were negatively related to WTP whereas income and the probability of developing cancer were positively related to WTP. Risk-relevant numeracy skills were positively related to self-assessed cancer risk, which may suggest that adults with poor numeracy skills underestimate their cancer risk. This has consequences not only on the relative perceived value of different cancer treatments across different population subgroups but also on perceived value as captured by WTP.

An economic evaluation of the war on cancer

For decades, the US public and private sectors have committed substantial resources towards cancer research, but the societal payoff has not been well-understood. We quantify the value of recent gains in cancer survival, and analyze the distribution of value among various stakeholders. Between 1988 and 2000, life expectancy for cancer patients increased by roughly four years, and the average willingness-to-pay for these survival gains was roughly $322,000. Improvements in cancer survival during this period created 23 million additional life-years and roughly $1.9 trillion of additional social value, implying that the average life-year was worth approximately $82,000 to its recipient. Health care providers and pharmaceutical companies appropriated 5-19% of this total, with the rest accruing to patients. The share of value flowing to patients has been rising over time. In terms of economic rates of return, R&D investments against cancer have been a success, particularly from the patient's point of view.

An economic analysis of hand transplantation in the United States

BACKGROUND

Hand transplantation has received international attention in recent years; however, the economic impact of this innovative treatment is uncertain. The aim of this study was to assess the utility and estimate the costs of hand transplantation and the use of hand prostheses for forearm amputations.

METHODS

One hundred medical students completed a time trade-off survey to assess the utilities of single and double hand transplantation and the use of hand prostheses. Quality-adjusted life years (QALYs) were calculated for each outcome to create decision trees. Cost data for medical care were estimated based on Medicare fee schedules using the Current Procedural Terminology code for forearm replantation. The cost of immunosuppressive therapy was estimated based on the wholesale price of drugs. The incremental cost-utility ratio was calculated from the differences in costs and utilities between transplantation and prosthesis. Sensitivity analyses were performed to assess the robustness of the results.

RESULTS

For unilateral hand amputation, prosthetic use was favored over hand transplantation (30.00 QALYs versus 28.81 QALYs; p = 0.03). Double hand transplantation was favored over the use of prostheses (26.73 QALYs versus 25.20 QALYs; p = 0.01). The incremental cost-utility ratio of double transplantation when compared with prostheses was $381,961/QALY, exceeding the traditionally accepted cost-effectiveness threshold of $50,000/QALY.

CONCLUSIONS

Prosthetic adaption is the dominant strategy for unilateral hand amputation. For bilateral hand amputation, double hand transplantation exceeds the societally acceptable threshold for general adoption. Improvements in immunosuppressive strategies may change the incremental cost-utility ratio for hand transplantation.

Contribution of intangible costs to the economic burden of multiple sclerosis

BACKGROUND

Multiple sclerosis (MS) is associated with a substantial economic burden resulting from direct medical costs associated with health and disability-related resource utilization and indirect costs relating to reduced productivity. However, reduced health-related quality of life (HR-QOL) may be associated with additional costs, often termed 'intangible costs,' that should be considered as part of the economic burden from the societal or patient perspectives.

OBJECTIVES

To review the contribution of intangible costs to the overall economic burden of MS.

METHODS

Medline was searched through March 2010 for relevant articles that included the terms 'multiple sclerosis' in combination with 'intangible costs,' 'QALY,' 'quality-adjusted life year,' 'willingness-to-pay,' and 'WTP.' Other than the restriction that the articles were published in English, there were no other exclusionary criteria for the search. Identified references were hand-searched to determine if intangible costs were estimated.

RESULTS

Thirteen studies across ten countries were identified that estimated intangible costs based on the number of quality-adjusted life-years (QALYs) lost due to a reduction in HR-QOL multiplied by accepted willingness-to-pay (WTP) thresholds. Although absolute costs varied depending on thresholds used and year of evaluation, the intangible costs accounted for 17.5-47.8% of total costs of MS. Furthermore, evidence suggested intangible costs are positively correlated with worsening disability. The largest increase in intangible costs occurred at the transition between mild and moderate disability. However, since no value has been established as being acceptable to pay for a QALY, a limitation of these studies was their dependence on the definition of the WTP threshold.

CONCLUSIONS

Intangible costs substantially add to the economic burden of MS. There is not only a need to further characterize these costs and incorporate them into economic studies, but also to determine how these costs can be reduced through appropriate management strategies.

Healthcare rationing by proxy: cost-effectiveness analysis and the misuse of the $50,000 threshold in the US

The application of cost-effectiveness analysis in healthcare has become commonplace in the US, but the validity of this approach is in jeopardy unless the proverbial $US50,000 per QALY benchmark for determining value for money is updated for the 21st century. While the initial aim of this article was to review the arguments for abandoning the $US50,000 threshold, it quickly turned to questioning whether we should maintain a fixed threshold at all. Our consideration of the relevance of thresholds was framed by two important historical considerations. First, cost-effectiveness analysis was developed for a resource allocation exercise where a threshold would be determined endogenously by maximizing a fixed budget across all possible interventions and not for piecemeal evaluation where a threshold needs to be set exogenously. Second, the foundations of the $US50,000 threshold are highly dubious, so it would be unacceptable merely to adjust for inflation or current clinical practice. Upon consideration of both sides of the argument, we conclude that the arguments for abandoning the concept for maintaining a fixed threshold outweigh those for keeping one. Furthermore, we document a variety of reasons why a threshold needs to vary in the US, including variations across payer, over time, in the true budget impact of interventions and in the measurement of the effectiveness of interventions. We conclude that while a threshold may be needed to interpret the results of a cost-effectiveness analysis, that threshold must vary across payers, populations and even procedures.

Towards cost-effective strategies for treatment of chronic kidney disease-mineral and bone disorder in Japan

There is a growing interest worldwide in making a more effective and efficient use of limited health care resources. Dialysis treatment in Japan and other countries is being confronted with increasing expenditure due to an aging population, coverage of new medical technologies, and an increase in the dialysis population. Chronic kidney disease-mineral and bone disorder (CKD-MBD) is an important issue related to the increased expenditure among dialysis patients because it is one of the main causes of morbidity and mortality, and results in a high economic burden. In recent years, several economic analyses on the treatment of CKD-MBD have been reported from Western countries. Given the longer dialysis vintage of Japanese patients, it is very important to conduct economic evaluation from a long-term viewpoint using clinical data on Japanese patients. This article reviews the recent literature on economic evaluation of CKD-MBD treatments and discusses the road ahead for cost-effectiveness analysis in Japanese dialysis patients with CKD-MBD.

The value of specialty oncology drugs

OBJECTIVE

To estimate patients' elasticity of demand, willingness to pay, and consumer surplus for five high-cost specialty medications treating metastatic disease or hematologic malignancies.

DATA SOURCE/STUDY SETTING

Claims data from 71 private health plans from 1997 to 2005.

STUDY DESIGN

This is a revealed preference analysis of the demand for specialty drugs among cancer patients. We exploit differences in plan generosity to examine how utilization of specialty oncology drugs varies with patient out-of-pocket costs.

DATA COLLECTION/EXTRACTION METHODS

We extracted key variables from administrative health insurance claims records.

PRINCIPAL FINDINGS

A 25 percent reduction in out-of-pocket costs leads to a 5 percent increase in the probability that a patient initiates specialty cancer drug therapy. Among patients who initiate, a 25 percent reduction in out-of-pocket costs reduces the number of treatments (claims) by 1-3 percent, depending on the drug. On average, the value of these drugs to patients who use them is about four times the total cost paid by the patient and his or her insurer, although this ratio may be lower for oral specialty therapies.

CONCLUSIONS

The decision to initiate therapy with specialty oncology drugs is responsive to price, but not highly so. Among patients who initiate therapy, the amount of treatment is equally responsive. The drugs we examine are highly valued by patients in excess of their total costs, although oral agents warrant further scrutiny as copayments increase.

How much is life worth: cetuximab, non-small cell lung cancer, and the $440 billion question

The spiraling cost of cancer care, in particular the cost of cancer therapeutics that achieve only marginal benefits, is under increasing scrutiny. Although health-care professionals avoid putting a value on a life, our limited resources require that society address what counts as a benefit, the extent to which cost should factor in deliberations, and who should be involved in these decisions. Professional societies, such as the American Society of Clinical Oncology, government agencies, including the Food and Drug Administration, and insurance companies should be involved. However, no segment of society is better qualified to address these issues than the oncology community. Oncologists must offer clear guidance for the conduct of research, interpretation of results, and prescription of chemotherapies. We review recent drug approvals and clinical trials and comment on their relevance to the issue of the spiraling cost of oncology therapeutics. We suggest some standards that would serve as a starting point for addressing these issues.

Economic evaluation and cost-effectiveness thresholds: signals to firms and implications for R & D investment and innovation

In this article we describe how reimbursement cost-effectiveness thresholds, per unit of health benefit, whether set explicitly or observed implicitly via historical reimbursement decisions, serve as a signal to firms about the commercial viability of their R&D projects (including candidate products for in-licensing). Traditional finance methods for R&D project valuations, such as net present value analyses (NPV), incorporate information from these payer reimbursement signals to help determine which R&D projects should be continued and which should be terminated (in the case of the latter because they yield an NPV < 0). Because the influence these signals have for firm R&D investment decisions is so significant, we argue that it is important for reimbursement thresholds to reflect the economic value of the unit of health benefit being considered for reimbursement. Thresholds set too low (below the economic value of the health benefit) will result in R&D investment levels that are too low relative to the economic value of R&D (on the margin). Similarly, thresholds set too high (above the economic value of the health benefit) will result in inefficiently high levels of R&D spending. The US in particular, which represents approximately half of the global pharmaceutical market (based on sales), and which seems poised to begin undertaking cost effectiveness in a systematic way, needs to exert caution in setting policies that explicitly or implicitly establish cost-effectiveness reimbursement thresholds for healthcare products and technologies, such as pharmaceuticals.