Economic evaluation of health programmes

1. Economic evaluation of health programmes Department of Epidemiology, Biostatistics and Occupational Health Class no. 7: Cost-effectiveness analysis – Part 2 Sept 24, 2008

2. Plan of class • Review Question 1 from assignment no 1 • Finish material from previous class • Quality of life scales • Extended dominance • Net benefit vs ICER

3. Relevance of each perspective

4. Perspective of analysis: Which costs to include

5. Perspective of analysis: Which costs to include

6. Perspective of analysis: Which costs to include

7. Time horizon decision • Should be long enough for consequences directly related to intervention to play themselves out • Do the costs of the 4 interventions have different time profiles? • Depression known to influence physical health care costs (several mechanisms) • Longer follow-up costly; use modeling study

8. CEA or CUA? • Turtle soup was tangy • Tables were attractively decorated • Service was prompt and attentive • Salmon was ordinary • Decor was so-so • Price was moderate VS. • Overall value for money: 4/5! CEA or CCA

9. Need for good effectiveness data • Efficacy vs effectiveness • Study protocols may influence outcome • Adjust if possible • Selective use of studies? • If no evidence, use sensitivity analysis

10. Intermediate vs final outcomes • Intermediate outcomes: medication adherence, blood pressure, cholesterol levels… • Usefulness of results depends on strength of evidence linking intermediate and final outcomes

11. Discounting benefits • Controversy whether to also discount benefits • But logical inconsistencies arise if benefits and costs not discounted at the same rate • So in practice best to discount at the same rate (report results with 5%, 3%, 0% for both) • See book for more detailed discussion

12. Quality of life scales • Specific measures (e.g., Wisconsin QOL for people with severe mental illness) • General health profiles (e.g., SF-36, GHQ) • Preference-based measures To be discussed as part of Cost-utility analysis

13. General health profiles Specific measures • More responsive to change • More acceptable to patients and clinicians • Do not yield results that can be compared across disease domains • May be less responsive to change • May be less acceptable to patients and clinicians • May yield results comparable across disease domains

14. Extended dominance

16. Assume 100 patients are to be treated and that the 3 treatments may be used (e.g., 1/3 get A, 1/3 B, etc.). What treatment(s) should the 100 patients receive to maximize the number of life-years gained? Suppose you have a budget limit - $20,000. Can a combination of A and C yield more life-years than B?

17. New Tx costs more Increased threshold ratio Existing threshold ratio A New Tx more effective 0

18. Net benefit instead of ICER ∆C/∆E < RT NMB = RT∆E - ∆C > 0 or NHB = ∆E - ∆C/ RT > 0

19. Example ∆C= $1,000; ∆E = 10 life years ∆C/∆E =100 $ per life-year Suppose RT = $50 per life-year Then ∆C/∆E > RT NMB = 50 x 10 - 1000 = -500 < 0 or NHB = 10 - 1000/ 50 = -10 < 0 Intervention is too costly for the life-years it provides