Health Economics and Cost/Decision Analysis

Transcription

1 Health Economics and Cost/Decision Analysis Samuel Finlayson, MD, MPH, FACS Department of Surgery University of Utah School of Medicine

2 Resources Constrained Every decision to provide a service represents an implicit decision not to provide some other service. (opportunity cost)

3 Provide cost-conscious care minimize cost maximize benefit PROVIDE VALUE

4 Glossary for Economic Analysis Cost-minimization Cost-benefit Cost-effectiveness Cost-utility

5 Cost Minimization Consider interventions A and B A and B both work. A costs less. Use A.

6 Cost-Benefit Interventions A and B A and B have costs: C A and C B A and B have outcomes: O A and O B (valued $) Compare A and B: C A /O A versus C B /O B

7 Cost-Effectiveness Interventions A and B again A and B have costs: C A and C B A and B have outcomes: O A and O B This time measured as health outcome (not $) e.g. lives saved, infections prevented, etc.

8 Cost-Effectiveness NET or INCREMENTAL cost-effectiveness C A -C B O A -O B

9 Utility and QALY Utility is measure of the value of a health state How much time in perfect health is your current health state worth? (time trade off) QALY = utility x year E.g. if one year in perfect health = 2 years with paraplegia then a year with paraplegia is 0.5 QALYs. (and utility of life with paraplegia = 0.5)

10 Cost-utility Type of cost effectiveness analysis based on utility (QALY) Expresses cost-effectiveness in terms of $ per QALY C A -C B QALY A -QALY B

11 How are economic analyses conducted? Clinical trials Decision models

12 Decision Analysis Quantitative, systematic approach to evaluating risks and benefits (tradeoffs) of an intervention Uses multiple data sources ( synthetic )

13 You re the Football Coach You are losing You have the ball 5 yards from the goal line 5 seconds left in the game Your call?

14 Summary of Steps 1. Model the decision 2. Apply probabilities of events 3. Apply value of outcomes 4. Analyze

15 1. Model the Decision

16 2. Assign Probabilities

17 3. Assign Values to Outcomes

18 4. Analyze (0.5*0.9) + (0*0.1) = 0.45 (1.0*0.4) + (0*0.6) = 0.40 Baseline analysis: FG strategy (0.45) preferred Typically also apply sensitivity analysis

19 Medical Decisions More complex Want to include costs/value

20 1. Model the decision survive Lose weight Bariatric surgery Don t lose wt. decide die Lose weight Diet & exercise Don t lose weight

21 2. Add probabilities 0.95 Bariatric surgery survive Lose weight Don t lose wt. decide 0.05 die Diet & exercise Lose weight Don t lose weight

22 3. Add values of outcomes LE U QALY 0.95 Bariatric surgery survive Lose weight Don t lose wt decide 0.05 die Diet & exercise 0.1 Lose weight Don t lose weight

23 4. Analysis EV = (0.1)(40)+(0.9)(24) = 25.6 QALY 0.95 Bariatric surgery survive Lose weight Don t lose wt. QALY decide 0.05 die 0 Diet & exercise 0.1 Lose weight Don t lose weight 24

24 4. Analysis QALY 36.5 decide 0.95 Bariatric surgery 0.05 survive die Lose weight Don t lose wt Diet & exercise 0.1 Lose weight Don t lose weight 24

25 How does one get from DA to CEA? Consider costs an outcome in the model

26 Add costs for CEA Lose weight Don t lose wt. Bariatric surgery 36.5 (Need to include decide 25.6 $$$ $ Diet & exercise survive die Lose weight Don t lose weight $ $ $ downstream costs as well)

27 Add costs for CEA $450, decide $$$ Bariatric surgery survive die Lose weight $ Don t lose wt $150,000 $ Diet & exercise Lose weight Don t lose weight $ $

28 Cost-Effectiveness NET or INCREMENTAL cost-effectiveness C A -C B O A -O B

29 Incremental Cost-Effectiveness Cost ($) Effect (QALY) Bariatric Surgery 450, Diet & Exercise 150, Net cost/effect 300, C/E ratio = $300,000/10.9 QALY = $27,500/QALY Interpretation: cost-effective

30 higher cost lower utility higher cost greater utility Utility alternative lower cost lower utility lower cost greater utility dominant Cost

31 How is CEA used? Common role for CEA informing decisions about individual interventions, identifying the best buy Common targets interventions that are new, controversial, or in direct competition with an accepted alternative treatment (CEA can be used to make an argument for additional expenditure)

32 Summary 1. DA synthesizes data from multiple sources and models clinical choices to estimate the relative benefits of competing interventions 2. Economic analysis measures the relative value interventions -- the cost of the additional health benefit -- to help establish priorities in resource allocation.