How to weight cost effectiveness in appraisal

NVTAG / CVZ course:The appraisal process, work in progress

22th of April 2009

Jan van Busschbach

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Context investigation CVZ

Cost effectiveness is considered in all new reimbursement application

Cost effectiveness is an important aspect in the appraisal

How to implement cost effectiveness in appraisal?

Two research questions:

1) What is a “good” and what a “bad” cost effectiveness? What is the threshold value? In terms of costs per QALY

2) How does one weight cost effectiveness with other considerations?

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What is the threshold value?

Should there be a threshold value? If there was one: what is the point in weighting with

other arguments? A threshold provokes strategic behavior Is there a normative paradigm (theory), that provides

such threshold? The need for a threshold is pragmatic

It helps to chose between good and bad Its value is historical determined

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Threshold most likely a range

A range like in England and Scotland £ 20.000 - £ 30.000 But higher values are possible

As defined by RvZ maximum € 80.000 per QALY In de media € 80.000 seem threshold But much lower values also possible

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Cost effectiveness in practice

Threshold might stand for average cost effectiveness in practice

Average cost per QALY Meerding et al, 2007 Cardiovascular diseases: € 2.000 to € 5.000 per QALY Oncology: €16.000 tot € 18.000 per QALY

In practice: A range Averages cost effectiveness is lower than used in most

debates about the threshold

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Conclusion research question 1

1. What is a “good” and what a “bad” cost effectiveness? What is the threshold value? In terms of costs per QALY

There is no empirically or theoretically fixed value

More likely: a range (of thresholds) Other variables determine good or bad cost

effectiveness

A variable threshold

Research question 2 How does one weight cost effectiveness with other

considerations? Same question as:

Is the threshold variable? If so: which variables have an influence?

For instance: does disease burden interacts with threshold value? CvZ models 2001, RvZ model 2006, 2007

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A variable thresholdThe RvZ model: interaction with

burden

Burden of Disease

Cos

ts p

er Q

ALY

Interaction with Burden

Burden of disease most often discussed As candidate to alter decision making To weight cost effectiveness

Know as the equity debate1) Maximize average population health…

Without looking at burden of disease2) Focus on the worse of….

Without looking at the average population health Interaction is intermediate position in debate

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Interaction with burden often suggested

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Methodology issues

How to measure burden? What should be the form of the curve?

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Cost per QALY

Burden of disease

But we do know…

The function is continuously ascending Burden can be measured

Next presentation: Elly Stolk We can deduct the curve from research

Population preferences The appraisal committee

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Next to burden….

Other argument than burden might be also be relevant

Examples are rarity (orphan drugs), budget impact, live style etc.

Some might increase the threshold, some might lower it…

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Increasing or lowering the threshold

Increasing Burden Rarity (orphan drugs) Relates to much informal care Risks for others

Lowering Limited relation to domain of health care High budget impact High future medical costs Unsuitable for insurance because of high incidence Unsuitable for insurance because of autonomy patient

Increasing threshold, and critics

Burden But lower population health…

Rarity (orphan drugs) Cause of disease becomes more important that burden and

effectiveness… Does not make much sense from epidemiology point of view

Relates to much informal care Could be include in the CE-ratio…

Risks for others Could be include in the CE-ratio…

Lowering the threshold, and critics

Limited relation to domain of health care What is the domain of health care...?

High budget impact Focus on costs, not on cost effectiveness

High future medical costs Could be include in the CE-ratio…

Unsuitable for insurance because of high incidence Might cause people to avoid health care

Unsuitable for insurance because of autonomy patient Might cause people to avoid health care

Conclusions

There does not seem to be a fixed threshold Many factors might alter threshold Burden of disease is best described Decisions of the appraisal committee will reveal trade-off

between cost effectiveness and other arguments