Principles of economic analysis of health care technology.
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Humans↗
Biomedical subjects
A L Hillman
Publications and source records attributed to A L Hillman.
Gene therapy: socioeconomic and ethical issues. A roundtable discussion.
Gene therapy research has the potential to revolutionize the way in which many human diseases are treated. Despite its enormous potential, roundtable panelists concluded that the field needs time to mature scientifically without pressure to develop a marketable therapeutic product. In addition, health care decision makers, physicians, and the lay public need to be educated on the future medical, economic, and ethical ramifications of gene therapy.
Clinical Trials as Topic↗
The cost-effectiveness of terazosin and placebo in the treatment of moderate to severe benign prostatic hyperplasia.
OBJECTIVES: To evaluate the cost-effectiveness and functional status effects of terazosin, an alpha(1)-adrenoceptor antagonist, compared with placebo in the treatment of men with moderate to severe, symptomatic, benign prostatic hyperplasia (BPH). METHODS: Prospective, randomized, double-blind, placebo-controlled multicenter trial of 2084 patients was conducted at 15 academic regional centers and 141 community-based satellite centers. Information about the use of health care resources and non-disease-specific functional status measures was collected by a standardized telephone interview of patients at baseline and every month thereafter for 12 months. Other information, such as American Urologic Association (AUA) disease-specific functional status scores, was obtained from the patient study records. Patients had a mean age of 65.7 years (range, 46 to 94), with a clinical diagnosis of BPH. At baseline men had at least moderate BPH symptoms by AUA Symptom score (13 or more) and Bother Score (8 or more). On entry, patients at regional sites had peak urinary flow rates 15 mL/s or less and total voided urine volumes 150 mL or greater. A total of 1053 patients were randomized to terazosin and 1031 to placebo treatment. Primary outcome measures included payments for all direct medical resource consumption (inpatient care, emergency department care, outpatient care, and medications); changes in three AUA disease-specific functional status indicators, (Symptom, Bother, and Quality of Life scores), and non-disease-specific functional status measures (days of work loss, days of customary activity loss, and days of bed rest). RESULTS: Total payments for health care resource (including study drug medication), adjusted to reflect 1000 patients per treatment group, were $3,781,803 and $3,568,263 in the placebo and terazosin groups, respectively. All three AUA disease-specific functional status scores improved significantly more in the terazosin group than in the placebo group. We found no difference between terazosin and placebo in all three nonspecific functional status measures. CONCLUSIONS: Compared with placebo, terazosin therapy for moderate to severe symptomatic BPH results in approximately equivalent payments for direct medical care, better disease-specific functional status improvement, and comparable change in non-disease-specific functional status measures.
Adrenergic alpha-Antagonists↗
Economic modeling to assess the costs of treatment with finasteride, terazosin, and transurethral resection of the prostate for men with moderate to severe symptoms of benign prostatic hyperplasia.
OBJECTIVES: We developed a decision analytic model to compare the costs of treatment for an initial 2-year period with finasteride, terazosin, and transurethral resection of the prostate (TURP) in men with at least moderate symptoms of benign prostatic hyperplasia (BPH). Outcome measures were BPH treatment costs, duration of symptomatic improvement, and lost productivity days (work or other customary activity). METHODS: Patterns of health care resource use associated with the treatment of moderate to severe BPH and BPH-related complications were evaluated by a survey of urologists and validated by a urology consensus panel. BPH safety and efficacy studies in the published literature were used to provide probabilities of treatment success. Both a national health care resource database (Systemetrics) and Medicare data were used to estimate the costs of specific health care services (such as physician services and laboratory tests). RESULTS: The probabilities of first-year success (defined as symptomatic improvement) for surgery, finasteride, and terazosin were 88%, 67%, and 74%, respectively. The most expensive intervention was surgery, followed by finasteride and terazosin, at estimated 24-month costs of $6411, $2860, and $2422 for private insurance and $3874, $2161, and $1820 for Medicare, respectively. Duration of symptom improvement was comparable for the three treatments. Estimates of usual activity days lost (work or other customary activity) were 22, 8, and 8 days for surgery, finasteride, and terazosin, respectively. CONCLUSIONS: As a primary intervention for patients considering conventional clinical approaches to BPH treatment, pharmacotherapy is expected to be less expensive than TURP over the initial 2 years of therapy.
Adrenergic alpha-Antagonists↗
Exemplary quality improvement programs in HMOs.
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Accreditation↗
Declining cost-effectiveness of screening for disease. The case of gastric cancer in Japan.
We examined the cost-effectiveness of screening for gastric cancer in hypothetical cohorts of asymptomatic Japanese ages 40, 50, 60, and 70, followed for 10 years. Current screening recommendations in Japan are not optimal. Although indirect x-ray is the correct method, screening for gastric cancer may not be cost-effective for Japanese under the age of 50. Policymakers worldwide should monitor the changing incidence of disease as they consider and recommend screening policies.
Adult↗
Diffusion of laparoscopic cholecystectomy among general surgeons in the United States.
Introduced in 1989, laparoscopic cholecystectomy has rapidly become the treatment of choice for symptomatic gallstones. This study describes the diffusion of laparoscopic cholecystectomy among general surgeons; assesses the importance of various reasons for surgeons adopting the procedure; and examine the influence of surgeon, practice, and health care market characteristics on the timing of adoption. The data were obtained from a survey of a national sample of surgeons. Most surgeons (81%) adopted laparoscopic cholecystectomy by early 1992. More than three fourths of adopters identified the desire to keep up with the state-of-the-art and improved patient outcomes as very or extremely important reasons for adoption. Results of proportional hazards regression analysis indicate that individual surgeons' adoption behavior generally was consistent with expected utility maximization in an uncertain new technological environment. Of particular interest, fee-for-service payment and more competitive practice settings and markets were associated with earlier adoption. These findings suggest that the "technological imperative" and surgeons' perception of the relative clinical and financial advantages of laparoscopic cholecystectomy were important reasons for the rapid diffusion of laparoscopic cholecystectomy. Policies that accelerate current trends toward payment of physicians based on salary or capitation and promote the growth of multispecialty group practice could slow the diffusion of new physician-based product innovations in health care.
Adult↗
Cost-effectiveness: from whose perspective?
Evaluating the cost-effectiveness of medical interventions, particularly pharmaceuticals, has been the focus of much debate in this country over the past few years. Although the support for efficient utilization of monies is widespread, the delicate balance between optimizing patient outcome with the costs to do so in high-risk patients is especially difficult. Although research in the field of cost-effectiveness is widespread, at present there are few guidelines in this country. Furthermore, the introduction of bias is a serious concern in the interpretation and validation of studies, often limiting their utility. Guidelines that can be implemented to minimize bias in economic research have been identified to include administrative, methodology-based, and ethical parameters. The standardization and implementation of such guidelines can reduce bias in economic research and optimize study validity. This review focuses on these issues and suggests that initial steps to produce unbiased economic research include total disclosure, appropriate comparator selection, complete release of all relevant data, and the cooperation of all involved parties.
Acquired Immunodeficiency Syndrome↗
Hospital adoption of medical technology: an empirical test of alternative models.
OBJECTIVE: This study examines hospital motivations to acquire new medical technology, an issue of considerable policy relevance: in this case, whether, when, and why hospitals acquire a new capital-intensive medical technology, magnetic resonance imaging equipment (MRI). STUDY DESIGN: We review three common explanations for medical technology adoption: profit maximization, technological preeminence, and clinical excellence, and incorporate them into a composite model, controlling for regulatory differences, market structures, and organizational characteristics. All four models are then tested using Cox regressions. DATA SOURCES: The study is based on an initial sample of 637 hospitals in the continental United States that owned or leased an MRI unit as of 31 December 1988, plus nonadopters. Due to missing data the final sample consisted of 507 hospitals. The data, drawn from two telephone surveys, are supplemented by the AHA Survey, census data, and industry and academic sources. PRINCIPAL FINDING: Statistically, the three individual models account for roughly comparable amounts of variance in past adoption behavior. On the basis of explanatory power and parsimony, however, the technology model is "best." Although the composite model is statistically better than any of the individual models, it does not add much more explanatory power adjusting for the number of variables added. CONCLUSIONS: The composite model identified the importance a hospital attached to being a technological leader, its clinical requirements, and the change in revenues it associated with the adoption of MRI as the major determinants of adoption behavior. We conclude that a hospital's adoption behavior is strongly linked to its strategic orientation.
Capital Expenditures↗
The impact of physician financial incentives on high-risk populations in managed care.
The challenge of managed care is to design a system in which rules and incentives together create a system of checks and balances that ensure both efficient and high-quality care. Incentives need to be administered so that physicians--both primary care providers and specialists--are not forced to choose between personal and/or organizational financial viability and patients' care. To accomplish this goal, payment needs to be linked both to quality and productivity and appropriately risk-adjusted. Quality assurance programs must ensure that both efficient and high-quality care is being provided and must maintain the satisfaction of both physicians and members. AIDS patients may be harmed by a system in which the more services a physician performs, the more he or she is paid--the traditional way in which American health care has been delivered heretofore. Managed care may undermine the care of high-risk patients if it arbitrarily reduces the high volume of care they require. However, a managed care system with effective checks and balances on financial incentives and quality of care can ensure that an efficient and high standard of care is being met--across all populations, including both healthy and high-risk patients.
Acquired Immunodeficiency Syndrome↗
A comparison of international health outcomes and health care spending.
Does increased spending improve health outcomes? We analyzed 1988 data from OECD countries to determine how key health care indexes correlate with health care outcomes. Total health care spending per capita and outpatient and inpatient utilization are not related to health outcomes. How our resources are allocated seems to be more important than how much money is actually spent.
Canada↗
Economic analysis of alternative treatments for persistent gastro-oesophageal reflux disease.
The economic evaluation of new medicines is increasingly important for pricing, registration and selection for use. A decision-analytic strategy was performed to assess the economic impact of antacids alone (phase I therapy), and in combination with either omeprazole, 20 mg once daily, or ranitidine, 150 mg twice daily, for patients with persistent, symptomatic gastro-oesophageal reflux disease of grade II or more (Savary-Miller classification). Data were obtained from published literature, an expert panel of gastroenterologists and actual payments by a private insurer in the USA. Over the 7-month period of the analysis, omeprazole reduced both symptoms and overall costs when compared with ranitidine or antacids. Consequently, the cost per symptom-free month was 43% lower with omeprazole than with ranitidine. Thus, omeprazole should be considered as the initial therapeutic approach for patients in whom phase I therapy fails.
Cost-Benefit Analysis↗
Reasons for increasing administrative costs in hospitals.
OBJECTIVE: To evaluate trends in administrative expenditures by examining changes in administrative costs compared with other areas of the hospital budget, changes in expenditures for patient care departments compared with nonpatient care departments, and departments with a greater number of regulatory requirements compared with those with fewer regulatory requirements. DESIGN: Annual hospital operating budgets submitted to Blue Cross were examined for an 8-year period from 1983 to 1990. PARTICIPANTS: Seventy hospitals in Western Pennsylvania. MEASUREMENTS: Annual operating expenditures. RESULTS: Total administrative expenditures showed a larger growth rate (90%) than service departments (29%), ancillary services (30%), professional care (52%), miscellaneous expenses (70%), and the total hospital budget (45%). Administrative costs increased from 10.6% as a proportion of the total hospital budget in 1983 to 13.9% in 1990. These increases were seen regardless of hospital size. Departments with a greater number of regulatory obligations had a greater increase in expenditures (84%) than did departments with fewer regulatory requirements (5%). However, overall expenditures in departments with direct patient care responsibilities did not increase appreciably faster (44%) than in departments not providing clinical services (46%), possibly reflecting the fact that administrative costs may be increasing equally in both areas. CONCLUSIONS: Administrative costs were found to be one of the fastest growing components of hospital budgets. Future research should determine the effect of these increases on the quality of patient care.
Budgets↗
A reappraisal of hepatitis B virus vaccination strategies using cost-effectiveness analysis.
OBJECTIVE: To determine clinical and economic consequences of alternative vaccination strategies for preventing hepatitis B virus infection (HBV). METHODS: Decision analysis was used to evaluate costs, outcomes, and cost-effectiveness of three HBV management strategies ("no vaccination," "universal vaccination," and "screen and vaccinate") in four populations (newborns, 10-year-old adolescents, a high-risk adult population, and the general adult U.S. population). Information on HBV incidence and prevalence, clinical course, and management of acute illness and chronic sequelae was obtained from the literature and a panel of experts. Actual payments (costs) were obtained from Blue Cross/Blue Shield and local pharmacies. Incremental cost-effectiveness was calculated from the perspective of the payer of medical care and subjected to sensitivity analysis. RESULTS: Vaccination (with or without screening) prevents more disease at somewhat increased cost than no vaccination for the neonatal, adolescent, and adult populations. Vaccination (with or without screening) is a dominant strategy in adult high-risk populations (lower cost and greater benefit than no vaccination). Optimal cost-effectiveness, with nonmonetary benefits not discounted, results if all pregnant women are screened for active HBV infection, and HBV vaccine and hepatitis B immune globulin are administered to babies born to mothers with positive screening tests. Then HBV vaccine is administered to all children at age 10 and again 10 years later (incremental cost-per-year-of-life-saved relative to the "no vaccination" strategy is $375). A strategy of universal newborn vaccination alone leads to an incremental cost-per-year-of-life saved of $3332. If adolescents are vaccinated at age 10, incremental cost-per-year-of-life saved is $13,938; for the general adult population, the incremental cost-per-year-of-life saved of universal vaccination is $54,524. Discounting benefits will increase cost-per-year-of-life saved 7 to 12 times for all strategies. CONCLUSIONS: HBV vaccine is most cost-effective when a strategy of screening newborns is combined with routine administration to 10-year-old children. The means to achieve substantial improvements in the health of the public in a cost-effective fashion are now available and should be pursued aggressively.
Adolescent↗
How important is the scientific literature in guiding clinical decisions? The case of magnetic resonance imaging.
Little is known about how information diffuses to clinicians and influences their purchase and use of new technology. This is especially true about the role of the scientific literature. As a case study, we examined the literature for magnetic resonance imaging (MRI) during the years preceding and the first five years following its clinical introduction. Using a computerized retrieval system, we identified approximately 1,700 citations in which MRI was the major topic. The clinical literature on MRI was heavily concentrated in radiology journals. Less than 28% of articles compared MRI with alternative diagnostic technologies. During the first five years of clinical availability, the diffusion patterns of scientific articles and operational units mirrored the example set by computerized tomography (CT), in that a substantial number of units were purchased in both research and nonresearch settings before studies were available comparing them to alternative diagnostic technologies. These patterns of diffusion, combined with other studies of the MRI literature's content and methodology, suggest that less comprehensive and objective sources of information were important in early purchasing decisions. This study also suggests that the present readership and publication patterns of professional journals may not facilitate effective, rapid information dissemination about innovations to a broad spectrum of clinicians.
Diffusion of Innovation↗
Hospitals' motivations in establishing or closing geriatric evaluation management units: diffusion of a new patient-care technology in a changing health care environment.
BACKGROUND: Although Geriatric Evaluation Management Units (GEMs) are beneficial to patients, they are still new and their adoption by hospitals is unknown. This study describes the adoption of GEMs in a large sample of hospitals, and explores the reasons underlying hospitals' decisions to open (and sometimes close) an inpatient GEM. METHODS: A nationwide mail survey was conducted of 3,655 hospitals. The survey asked whether the hospital had an operating GEM, had a GEM that closed, had considered opening a GEM (but had not done so), or had not considered opening a GEM. The survey also requested specific information about operating or closed GEMs. Descriptive statistics, chi-square, t-tests, one-way analysis of variance, and Tukey's standardized range test for multiple comparison of means were used to analyze the responses. RESULTS: Among the 1,639 responding hospitals, 159 had established GEMs, 200 were evaluating the possibility of opening a GEM, and 1,263 had neither opened nor considered opening a GEM. Adopters were more likely to be large, urban, teaching hospitals. Evaluators were more optimistic than adopters about GEM's potential to meet financial goals. GEMs that closed tended to be located in hospitals experiencing budget deficits. Among adopters, space and nonphysician staffing were the most critical barriers to establishing a GEM whereas, for evaluators, identifying reimbursement sources and physician staffing were the greatest barriers. VA GEMs are smaller and initiated for different reasons than non-VA hospital GEMs. CONCLUSIONS: Despite their demonstrated usefulness, the adoption of GEMs has been limited. The reasons underlying decisions to adopt this new technology or close a GEM are often related to financial, not clinical concerns.
Aged↗
Safeguarding quality in managed competition.
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Competitive Medical Plans↗
Issues in the cross-national assessment of health technology.
With the growing international literature in economic evaluation and the rapid spread of new health technologies, there is a need to undertake, or at least interpret, economic evaluations on the international level. However, the ways in which cross-national differences affect the cost-effectiveness of health technologies or their evaluations have never been studied. This paper explores these issues by taking advantage of a unique situation in which the same economic evaluation of a new indication for a health technology was conducted simultaneously in four countries using an identical methodology. The study showed that if prior agreement on methods can be reached and local data applied, economic evaluations can be undertaken in a way that facilitates the extrapolation of results from country to country.
Cost-Benefit Analysis↗