Mind the Gap Skills in Health Economics

1. Mind the GapSkills in Health Economics Dr JK Miot PCMA AGM March 2011

2. Quick Quizz • Can you name the 4 different types of health economics analyses? • Do you know the formula for an ICER? • Do you know the difference between a Cost-utility study and a Cost-effectiveness study? • Do you know the difference between a QoL measure and a Utility? • Do you know what a Probabilistic Sensitivity Analysis is?

3. So what are your skills? How many of you: • Could build a simple model in Excel? • Have built a simple model in Excel? • Have built a Markov model? • Have done a Probabilistic Sensitivity Analysis? • Could critically appraise a health economics study?

4. Another Quick Quizz Raise your hands if you: • Know the Levels of Evidence Hierarchy? • Know what a double blind randomised control trial is? • Know what a confidence interval is? • Know the difference between blinding and allocation concealment? • Could critically appraise a clinical trial?

5. Can you calculate these? RxER = CER = RR = RRR = ARR = NNT = Odds = OR = How good are your Clinical Evaluation Skills?

6. Did you get it right? RxER = a/(a+b) CER = c/(c+d) RR = RxER/CER RRR = (CER-RxER)/CER ARR = RD = CER-RxER RRR = 1- RR NNT = 1/ARR Odds = a/b and c/d OR = (a/b)/(c/d) = ad/bc

7. Health Technology Assessment (HTA) Clinical, economic, financial and social effects Aimed at assisting Policy making • Evidenced Based Medicine • What is best for the patient? • Aimed to assist clinical decisions • Economic Evaluation • Value, Cost-benefit and Cost-effectiveness • Pharmacoeconomic studies • Budget Impact Analysis • Financial assessment • Payer perspective • Social Impact Analysis • Access and equitable care • Patient perspective

8. Why do we need Health Economics? “All effective health technologies should be free” • Archie Cochrane But • The introduction of new effective technology is faster than the increase in our ability to pay for them • Uncertainty about both effects and resource use for new technologies

9. Balancing Uncertainty and Access • Unrestricted Access • Spending scarce healthcare resources on technologies that provide little if any benefit or may even harm • Restricted Access • Delaying benefits which could be accrued whilst generating further evidence on effectiveness • Need to explore ways to take into account uncertainty while also offering chance for earlier/increased access to novel treatments Trueman P. ISPOR SA 3rd Annual Conference 2010

10. Trends • Increasing number of high cost drugs requiring health economic evaluations • Increasing pressure on funders to provide access to these drugs • Increasing requirements for proof of cost-effectiveness for re-imbursement • Increasing transparency in adoption of HE and re-imbursement decisions – Australia vs UK • Use of HE to inform multiple-level co-pays and other restrictions on access • Use of HE earlier in drug development (Phase 2 trials) to inform stop-go decisions and portfolio reviews

11. Uses of Health Economics Studies • Submission for Re-imbursement • Submission for Regulatory approval • Academic and Educational • Publication for information • National Guidance • Policy Determination • Cost-Benefit Analysis

12. Who uses Health Economic studies and why? • Healthcare Funders • Allocate resources equitably • Assist in decision-making for high cost technologies • Ensure sustainability of the fund • Government/State • Allocate resources to programmes • Decide whether to purchase - Xigris • Decide what to purchase - Syringes • Manufacturers/Suppliers • Decide whether to market product • Decide where to market – primary vs. specialists • Sell their product – providers, funders, state • Academics • Research • Teaching • Healthcare Providers • Provide most cost-effective treatment vs. least/most costly • Choose between alternative treatments

13. PE Guidelines Worldwide

14. Who is responsible for evaluating PE submissions OECD Health Working Paper No 4 & ISPOR Pharmacoeconomic guidelines around the world

15. Use of External Consultants OECD Health Working Paper No 4 & ISPOR Pharmacoeconomic guidelines around the world

16. Objectives of PE Guidelines and Submissions • Aid to decision-making • Consistency – adhere to std requirements • Transparency – publish outcomes • Clinical appropriateness • Securing value for money • Inform pricing negotiations • Reduce unnecessary drug use • Bring down cost of drugs • Sensitise suppliers and decision-makers to need for cost-effective medicines • Improve cost-effectiveness of prescribing

17. Main obstacles in achieving objectives • Insufficient skilled resources • Inappropriate prescribing • Inappropriate drug use by patients • Inadequate public resources • Lack of legal authorisation • Lack of co-operation by manufacturers

18. Common Problems seen By Australian regulator (PBAC) • Unsuitable comparators • Incomplete literature search • Methodological errors • Calculation errors • Modeling errors • Subgroup analyses • Inappropriate adjustments of event rates • Analyses (trials used) don’t match registered indication

19. Common Problems seen By Australian regulator • Use of clinically insignificant outcomes • Surrogate outcomes • Therapeutic equivalent dosages • Duration of trials too short • Too optimistic cost savings with no supporting data These are largely Clinical and Evidence issues…..! Don’t bother with a pharmacoeconomic evaluation if the clinical evidence is poor!

20. Other Challenges • Measuring relevant costs and benefits • Vary from country to country ( transferability) • Value of surrogate endpoints • Local costs and resource utilisation • Lack of long-term follow-up – extrapolation beyond clinical trials • Especially important in chronic disease • Some modelling is required • Decision needed now - can’t wait until long-term data is available • Reducing uncertainty to improve confidence in outcome • Sensitivity analysis • Cost-effectiveness acceptability curves plotted from probabilistic model • How to define cost-effectiveness • Do we need a threshold? • Only relevant from a social perspective? • How make the budget allocation • How to define the budget? • Payer perspective (which payer?) • What about resource consequences that fall outside the payer? (included in the benefit measure?)

21. What skills are required? • A Health Economics Evaluation is NOT JUST about economics • Health Economic Evaluation is multi-disciplinary, it combines • Economics • Epidemiology • Biostatistics • Medicine • Pharmacy • Nursing • Accounting • Public Health • Health Administration • Psychometrics • Sociology • Management Sciences • Actuarial Sciences • Finance • ….

22. Skills Survey 2009 • N = 107

23. Skills Survey 2009 Most people who said ‘yes’ have attended one day industry programs, certificate programs, internal company training, PCMA, etc.

24. Levels of Health Economics Functions

25. What Levels of Training are needed? Education and Skills needed to conduct, interpret and use economic evaluations in healthcare. ISPOR Panel 4. Value in Health, 1999. 2 (2):88-91

26. Obstacles to getting people interested in health economics • Economists • Many different career options • Highly paid jobs/careers in finance • Little interest in health • Not exposed to concepts of HE as undergraduates • Health Providers • Prefer clinical work • Little interest in health policy and systems • Not exposed to concepts of health economics • Perceived as “the dark side” Need to create VISIBILITY

27. Retaining Health Economists • Few specific positions for HE • Only part of job description • Often soft-funded, research grants etc • Use it or Lose it • Need to continue using skills • Lack of continuous opportunities • Limited local training options • Often working alone • Lack of focussed career path • Boss doesn’t understand value

28. Stimulating demand for health economics • Sensitise governments and decision makers to value of health economics • Develop tools to assist • Develop skills in using these tools Strengthening Health Economics Capability in Africa. World Health Organisation. 2008. Prof D McIntyre

29. Developing skills • Need to establish critical mass • Networks and Associations are key • Collaboration – scarce resources • Academic involvement • Create opportunities for growth and career paths Strengthening Health Economics Capability in Africa. World Health Organisation. 2008. Prof D McIntyre

30. The Up Side • Part of the new wave • Shaping health policy • Finding a solution • Growing sector in SA • International career

31. Challenges are Opportunities Using EBM and Health Economics leads to; • Better clinical outcomes • More efficient use of resources • Reduce over-utilisation • Reduce perverse incentives • Improved re-imbursement structures • Improved training and skills

32. “The study of health economics (HE) will stimulate anyone who believes that seeking to improve human health is worth using up some of the world's scarce resources” Stephen Heasell. Principle Lecturer in Economics, Nottingham Trent University