Using CEA to inform state policy 30 November 2017

Transcription

1 E: USING COST- EFFECTIVENESS ANALYSIS TO INFORM STATE POLICY Health Policy and Management Jeffrey S. Hoch, PhD Associate Director, Center for Healthcare Policy and Research Professor and Chief, Division of Health Policy Management Department of Public Health Sciences, University of California, Davis 2 Jeffrey S. Hoch, PhD 1

2 4 Disclaimer The opinions expressed in this talk are mine and are not meant to represent official positions of the people or groups with whom I work. THIS SESSION IS NOT HOW TO DO CEA Mathy, Statsy, or Numbery Focused on health & other areas 6 WHY YOU SHOULD CARE 01 Costs challenge patients and payers 02 Paying for Value (not volume) is a popular solution 03 Costeffectiveness analysis is a way to look at Value. Jeffrey S. Hoch, PhD 2

3 7 WHAT IS VALUE? process outcome cost In most industries, value as defined by consumers is associated with in four attributes: Accessibility: can I get what I need or want from you? Service: is dealing with you a pleasant experience? Effectiveness: is what you re providing going to satisfy my need or want? Costs: what s the cost to me and my family and is it worth it? 8 The trip and the options what you get The Trade-off What it costs 9 Jeffrey S. Hoch, PhD 3

4 10 In collaboration with the partner organizations, Consumer Reports has created resources to engage in conversations about the overuse of medical tests and procedures that provide little benefit and in some cases harm. Choosing Wisely recommendations should not be used to establish coverage decisions or exclusions. Rather, they are meant to spur conversation about what is appropriate and necessary treatment. As each patient situation is unique, providers and patients should use the recommendations as guidelines to determine an appropriate treatment plan together. Policy is made for a population, not a patient. How to use Cost-Effectiveness Analysis (CEA) to look at Value at the population (policy) level? 11 COUNT DOWN TO USE 4 Quadrants 3 Findings 2 Items of interest 1 Thing 12 WHERE ARE WE? An economic evaluation tells you a tradeoff located in one of 4 areas Jeffrey S. Hoch, PhD 4

5 13 4 potential outcomes 2 dimensions x 2 directions Less effective More effective Costs more Costs less 14 2 X 2 TABLE = 4 QUESTIONS More or less means > 2 options. Are they relevant/correct? Whose cost? more than or less than 1 option is Decision maker s perspective included? compared to a 2 nd option. Which outcome (what to use as effect)? Is Does one that the matters usual included? care in the analysis match your context / reality? Over what time horizon? Over policy/clinically relevant time period? 15 2 X 2 TABLE = 4 QUESTIONS More or less means > 2 options. Are they relevant/correct? Whose cost? Decision maker s perspective included? Which outcome (what to use as effect)? The Is one decision that matters maker included? cares about the decision maker s costs (i.e., not paying = Over not a what cost) time horizon? Over policy/clinically relevant time period? Jeffrey S. Hoch, PhD 5

6 16 2 X 2 TABLE = 4 QUESTIONS More or less means > 2 options. Are What they are relevant/correct? you trying to accomplish with this policy or program? Whose cost? Decision maker s perspective included? Which outcome (what to use as effect)? Is one that matters included? Over what time horizon? What Over amount policy/clinically of success relevant does time the period! new option offer? 17 2 X 2 TABLE = 4 QUESTIONS 1200 More or less means > 2 options Are they relevant/correct? Whose cost? 400 Decision 200 maker s perspective included? 0 Time horizon matters Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Which outcome (what to use as effect)? Costs Benefits cost benefit Is one that matters included? Over what time horizon? Over policy/clinically relevant time period! 18 2 X 2 TABLE = 4 QUESTIONS More or less means > 2 options. Are they relevant/correct? Whose cost? Decision maker s perspective included? Which outcome (what to use as effect)? Is one that matters included? Over what time horizon? Over policy/clinically relevant time period! Jeffrey S. Hoch, PhD 6

7 19 4 potential outcomes Right Cost? Both Cost and Effect Less effect More effect Costs more Costs less Right Effect? 20 EXAMPLE OF THE MAIN TYPES OF CHALLENGES 1) Can you find the right box? YES or NOT yet II) Is the information useful/relevant? YES or NOT yet 21 A NEW SMOKING CESSATION PROGRAM A 6 month study shows that a new smoking cessation program costs $2,500 per person. Jeffrey S. Hoch, PhD 7

8 22 Some of the benefits reported by those who quit include: Better appearance Better breath and whiter teeth Appetite for food is rediscovered An improved sense of smell Better lung capacity A NEW SMOKING CESSATION PROGRAM A 6 month study shows that a new smoking cessation program costs $2,500 per person. 23 EXAMPLE COMPLETED The new smoking cessation program helps more people quit smoking than the standard practice and costs more over a 50 year time horizon. 24 COUNT DOWN TO USE 4 Quadrants 3 Findings 2 Items of interest 1 Thing Jeffrey S. Hoch, PhD 8

9 25 4 potential outcomes 2 dimensions x 2 directions Less effective More effective Costs more Easy NO Costs less 26 4 potential outcomes 2 dimensions x 2 directions Less effective More effective Costs more Costs less Easy YES 27 4 potential outcomes 2 dimensions x 2 directions Less effective More effective Costs more It Depends Costs less It Depends Jeffrey S. Hoch, PhD 9

10 28 3 potential findings Less effective Similar Effect More effective Costs more Similar Costs Costs less 29 What do you need to know? TEST YOUR UNDERSTANDING 4 Quadrants,3 Findings, 2 Items of interest, 1 Thing 30 What might you find? TEST YOUR UNDERSTANDING, CONTINUED 4 Quadrants,3 Findings, 2 Items of interest, 1 Thing Jeffrey S. Hoch, PhD 10

11 31 COUNT DOWN TO USE 4 Quadrants 3 Findings 2 Items of interest 1 Thing items of interest: 1)Estimate Less effective Same Effect More effective Costs more Costs the same Costs less 33 2 items of interest: 2)Uncertainty Less effective Same Effect More effective Costs more Costs the same Costs less Jeffrey S. Hoch, PhD 11

12 34 USING 2 ITEMS OF INTEREST: 1) ESTIMATE & 2) UNCERTAINTY ESTIMATE How much extra cost? How much extra effect? UNCERTAINTY What other values are possible? What is the 95% CI? How much extra cost per extra effect? How much more extra benefit than extra cost? $75,000 extra cost and 6 more months of life $75,000 / 0.5 years = $150,000 per year of life 35 Cost C = $75,000 $75,000 extra cost and 6 more months of life $75,000 / 0.5 years = $150,000 per year of life Patient outcome E = 6 months or 0.5 year Jeffrey S. Hoch, PhD 36 COST-EFFECTIVENESS PLANE More Costly, C > 0 Lose-Lose More Costly/More Effective Less Effective, E < 0 More Effective, E > 0 Less Costly/Less Effective Win-Win Less Costly, C < 0 36 Jeffrey S. Hoch, PhD Jeffrey S. Hoch, PhD 12

13 37 COST-EFFECTIVENESS PLANE Extra cost per 1 extra effect (ICER) Extra cost $150,000 $75,000 More Costly, C > 0 More Costly/More Effective Less Effective, E < yr 1.0 year More Effective, E > 0 Less Costly/Less Effective Less Costly, C < 0 $75,000 extra cost and 6 more months of life $75,000 / 0.5 years = $150,000 per year of life Jeffrey S. Hoch, PhD 38 THE STORY OF ONE ARTICLE JEFFREY S. HOCH, PHD 39 Estimates Jeffrey S. Hoch, PhD 13

14 40 Uncertainty 41 WHAT IS THE DECISION MAKER WILLING TO PAY? Is $150k per year of life worth it? YES! no This is costeffective! This is not costeffective WTP WTF? 42 P(CE) Uncertainty WTP Jeffrey S. Hoch, PhD 14

15 43 COUNT DOWN TO USE 4 Quadrants 3 Findings 2 Items of interest 1 Thing 44 In a perfect theory world (where budget determines WTP). Calculate all of the extra cost per extra effect (using CEA) and then purchase from lowest to highest until you run out of your budget 45 In a perfect theory world (where WTP determines budget). Use CEA results to purchase from lowest to highest until you hit the magical WTP threshold (e.g., 30,000) Jeffrey S. Hoch, PhD 15

16 46 Neither the budget nor the WTP are known and no payer is buying everything at once. No rec committee knows 47 There is something odd about the choreography of the CEA 48 WHAT IS BEING CONSIDERED? Given the available evidence on comparative effectiveness and incremental cost-effectiveness, and considering other benefits, disadvantages, and contextual considerations, what is the long-term value for money of treatment with acupuncture and usual care versus usual care alone for patients with chronic low back pain? Jeffrey S. Hoch, PhD 16

17 CHBRP 50 Clinical evidence Patient values The 4 key areas Cost-effectiveness Feasibility of Adoption (into the Health System) Jeffrey S. Hoch, PhD 51 LESSONS FROM FRONT ROW SEATS 1) Other evidence in addition to economic evidence is used in decision making 2) almost no one is a health economist among policy advisors and policy makers 3) Good & Useful can be better than Perfect & Right Jeffrey S. Hoch, PhD 17

18 TO USE CEA, YOU MUST HAVE 4 Quadrants 3 Findings 2 Items of interest 1 Thing 52 FINAL EXAM 1) Is this cost-effective? 2) How do people view CEA? 53 FINAL EXERCISE Economic analysis of erythropoietin use in orthopaedic surgery. by Coyle D, Lee KM, Fergusson DA, Laupacis A. Transfus Med Mar;9(1): Example: Cost-effectiveness of epoetin-alpha (EPO) to augment preoperative autologous blood donation (PAD) in elective surgery Concerns: Allogeneic (someone else s) blood might have disease Autologous (your own) blood is costly to get, and so is EPO 54 Jeffrey S. Hoch, PhD 18

19 FEEDING DATA TO A MODEL 55 COST EFFECTIVENESS RESULTS Is EPO cost-effective? 56 COST EFFECTIVENESS RESULTS BY HOMER Is EPO cost-effective? 57 Jeffrey S. Hoch, PhD 19

20 COST EFFECTIVENESS RESULTS BY HOMER SIMPSON 58 Is EPO cost-effective? What do we already know (what can we already achieve w/o EPO)? COST EFFECTIVENESS RESULTS Intervention Life Years Extra Life Years Cost No intervention EPO Extra Cost Cost per life year gained $66.3 million PAD EPO + PAD $329.3 million Incremental cost-effectiveness ratio (ICER) = C / E ICER = Extra cost / Extra effect extra cost of 1 more unit of extra effect 59 TO USE CEA, YOU MUST HAVE 4 Quadrants 3 Findings 2 Items of interest 1 Thing More costly, more effective Easy no C = $1935 E= 3 minutes; C/ E = 330 mill per 1 YR NO uncertainty shown 60 Jeffrey S. Hoch, PhD 20

21 TO USE CEA, YOU MUST HAVE 4 Quadrants 3 Findings 2 Items of interest 1 Thing 61 DIFFERENT OPINIONS SOUND LIKE 62 WHAT HAPPENED IN ONTARIO? 63 Jeffrey S. Hoch, PhD 21

22 TO USE CEA, YOU MUST HAVE 4 Quadrants 3 Findings 2 Items of interest 1 Thing 64 AS HEALTHCARE BECOMES MORE EXPENSIVE There will be more focus on value (i.e., cost and effectiveness of new treatments). Cost-effectiveness analysis (CEA) is a tool used throughout the world to help inform policy. The questions you ask when smart shopping are the same ones users of CEA should ask 65 E: jshoch@ucdavis.edu jshoch@ucdavis.edu 66 Jeffrey S. Hoch, PhD Jeffrey S. Hoch, PhD 22