Cost-Effectiveness Analysis and Ageism Daniel Eisenberg, PhD Dept of Health Management and Policy...
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Transcript of Cost-Effectiveness Analysis and Ageism Daniel Eisenberg, PhD Dept of Health Management and Policy...
Cost-Effectiveness Analysis and Ageism
Daniel Eisenberg, PhD
Dept of Health Management and PolicySchool of Public HealthUniversity of Michigan
AcademyHealth Annual Research Meeting
2006
University of MichiganSchool of Public Health
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Allez Les Bleus!
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Go Blue!
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Background: Economic Methods for Evaluating Health Interventions
• Cost effectiveness analysis (CEA): $/life-year ($/LY) or $/disability-adjusted-life-year ($/DALY)
• Cost utility analysis (CUA): $/quality-adjusted-life-year ($/QALY)
• In CEA and CUA, the unit of health, whether it’s a LY, DALY, or QALY, is typically weighted the same at all ages (e.g. 1 QALY at age 10 = 1 QALY at age 70)
• Cost benefit analysis (CBA) often uses single “value of a statistical life” for all ages
• Thus, CEA and CUA account for life expectancy whereas CBA typically does not
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Background: Economic Methods (cont’d)
Standard CEA/CUA
CBA w/ single value-of-life
Modified CEA/CUA?
Increasing priority for health of young
Decreasing priority for health of young
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Policy Context
• Debate within federal government about whether agencies should be doing CEA vs CBA vs CUA
• Who gets influenza vaccines first?– Recent article in Science (Emanuel and Wertheimer
2006) critiquing priorities of National Vaccine Advisory Committee (NVAC) and the Advisory Committee on Immunization Policy (ACIP)
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Key Question
• How can we modify cost effectiveness analysis (CEA) methods to reflect more accurately our society's valuation of health improvements by age?
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Synthesis of Related Theoretical and Methodological Literature
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Synthesis of Arguments in Literature on Why CEA Should Be Modified
1. Future health gains should be weighted more to reflect society’s increase in willingness-to-pay over time for health• 1-2 % increase per year
2. Net resource use should be included in costs• Consumption minus productivity (Meltzer)
3. Younger life-years should receive priority for equity reasons• “Fair innings” argument: young have not had their
share of life yet
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Evidence on Argument #1
• Value of health gains rises at least in proportion to income:– Costa, Dora L. and Matthew E. Kahn (2004) J of Risk
and Uncertainty.– Hammitt, James K., Jin-Tan Liu, and Jin-Long Liu
(2004). Harvard Univ. mimeo.– Hall, Robert, and Chad Jones. (2006). Forthcoming in
Quarterly J of Economics.
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Evidence on #2 (Net Resource Use)
• Net resource use (consumption minus productivity) (Meltzer 1997 J of Health Econ):– Positive for children and adolescents– Negative for adults until retirement age– Positive for adults after retirement age
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Evidence on #3
• Equity concern is supported consistently in a variety of survey studies
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Survey Evidence on Valuation of Health by Age
Suppose a choice must be made between two medical programs. The programs cost the same but there is only enough money for one.
• Program A will save 100 lives from diseases that kill 20-year-olds.
• Program B will save 200 lives from diseases that kill 60-year-olds.
Which program would you choose?
Example from Cropper et al (1994). Journal of Risk and Uncertainty 8: 243-265.
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Survey Evidence (cont’d)
• Several studies (from a variety of countries) find that respondents not only place higher values on younger lives, but they do so more so than can be explained by differences in life expectancy
• These preferences are consistent for all age groups of survey respondents
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Translating Survey Evidence Into Modifications for CEA Methods
Age Weights from World Bank Guidelines and Rodriguez & Pinto
2000)
0
0.5
1
1.5
2
age 10 19 28 37 46 55 64 73 82
wei
gh
t
Standard CEA
Age Weights
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Implications for CEA Methods
1. Increasing valuation of health over time -> weight life-years by increasing amount: (1+x)^t
2. Net resource use -> add it to costs
3. Equity concerns -> construct age weights based on survey data on preferences
Does it make sense to do all of these at once?
That depends on interpretation of survey data.
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Example: Re-analysis of Recently Conducted CEAs
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CEAs to be Re-Analyzed
• We selected for re-analysis CEAs that:– Were published within last 10 years– Evaluated interventions for people of ages under 21– Yielded cost-effectiveness ratios between $50,000
and $500,000 per LY (i.e. dubious cost effectiveness)
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Two CEAs Identified for Re-analysis
• Jacobs et al (2003). Regional variation in the cost effectiveness of childhood hepatitis A immunization. Pediatr Infect Dis J 22: 904-14.– Universal immunization in low prevalence states
• Kulasingam, S.L. and E.R. Myers (2003). Potential health and economic impact of adding a human papillomavirus vaccine to screening programs. JAMA 290(6): 781-9.– Vaccine plus screening starting at age 24 versus
vaccine plus screening starting at age 18
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Methods for Re-analyses
We separately applied the following methods:
1) Standard CEA
2) Increasing value of health over time (2% year)
3) Age-weights
4) #2 and #3
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Results: Cost EffectivenessUnder Each Method
Study Units (1)
HepA vac. $/QALY 63,000
HPV vac. $/LY 96,000
(1) Standard CEA (discount rate = 3%)
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Results: Cost EffectivenessUnder Each Method
Study Units (1) (2)
HepA vac. $/QALY 63,000 52,000
HPV vac. $/LY 96,000 46,000
(1) Standard CEA (discount rate = 3%)
(2) Increasing valuation of health effects (2% per year)
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Results: Cost EffectivenessUnder Each Method
Study Units (1) (2) (3)
HepA vac. $/QALY 63,000 52,000 49,000
HPV vac. $/LY 96,000 46,000 72,000
(1) Standard CEA (discount rate = 3%)
(2) Increasing valuation of health effects (2% per year)
(3) Age-weighting by formula in Rodriguez & Pinto (2000) (w/ 3% discounting)
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Results: Cost EffectivenessUnder Each Method
Study Units (1) (2) (3) (4)
HepA vac. $/QALY 63,000 52,000 49,000 39,000
HPV vac. $/LY 96,000 46,000 72,000 37,000
(1) Standard CEA (discount rate = 3%)
(2) Increasing valuation of health effects (2% per year)
(3) Age-weighting by formula in Rodriguez & Pinto (2000) (w/ 3% discounting)
(4) Combination of (2) and (3)
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Conclusion
• Standard CEA methods do not reflect societal preferences related to age
• Modifications grounded in theoretical and empirical evidence lower CE ratios substantially for interventions targeted at young people
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Implications
• CEA practitioners can use adjustments for increasing value of health over time and age weights to reflect these concerns
• Readers of CEAs should bear in mind that the technique, as currently practiced, does not reflect societal preferences with respect to age
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Acknowledgements
• Gary Freed, MD, MPH• R. Jake Jacobs, MPA and co-authors on Jacobs
et al (2003)• Shalini L. Kulasingam, PhD and Evan R. Myers,
MD, MPH• R. Douglas Scott, PhD