In the example in regards to weight loss, we have treatments that turned out to be useless.

But more, more challenging, is the situation looked at next, where a treatment has some very small advantage over alternative treatments, but at a very high price.

The number of such treatments is enormous, and we're definitely paying for them. Most of us would agree that an expensive new treatment is worth the added cost if there's a big bang for the buck. We don't mind rising health-care costs when the benefits are substantial. We're not necessarily looking to save money on health care, just to get value for our money.

For example while compairing different chemotherapy treatments , the average survival was only eight months regardless of therapy.1/2.

Side effects differed somewhat among the regimens, and it appeared that patients treated with carboplatin plus Taxol had somewhat less nausea than patients given the other treatments. The magnitude of this benefit remains a bit unclear, though, because patients in the Taxol group used more antinausea drugs. And, of course, drugs for nausea are an option with any of the treatments. Furthermore, overall quality of life measures were the same among the different groups. Nonetheless, the major cancer research groups in the United States adopted the carboplatin and Taxol treatment as the standard regimen for comparison in future studies.3/4.

So far, so good. But consider the costs. Scott Ramsey, the doctor and economist at the University of Washington and the Fred Hutchinson Cancer Research Center, undertook a careful evaluation of the all the costs associated with the different treatment strategies. The new "standard regimen" costs up to $12,000 more per patient than the least expensive treatment. The more expensive treatment offered no savings in downstream costs like further hospitalization, emergency visits for treating side effects, other drugs, or blood transfusions. Given that almost 105,500 persons are diagnosed with this type of cancer each year, using the carboplatin and Taxol regimen as first-line therapy will cost about $1 billion more per year than the alternative treatments. Of course, what isn't clear from these studies is whether any of these chemotherapy treatments offer an improvement in quality or length of life compared to supportive care alone. And if so, how much?

Is $1 billion a year a reasonable price to pay for an uncertain reduction in nausea over an eight-month period for patients who are terminally ill? Before you answer, consider that insurers, who work within a budget, will have to cover these costs. To do so, they'll have to stop paying for other things, reduce the amount they pay for various services, or charge you higher premiums. Would you be happy to increase your insurance costs or your Medicare taxes to cover this particular treatment?

In the USA medicare covers most patients with lung cancer, and there's little appetite for increasing Medicare taxes. Congress gives Medicare a fixed budget, and the agency is struggling to keep up with rapidly rising costs. In recent years, Medicare officials have sometimes decided to shrink payments to doctors rather than eliminate coverage for other services. Because of the cuts, some doctors have declared that they'll no longer care for new Medicare patients.5  We have to consider this kind of trade-off if we want the more expensive new chemotherapy program.

 

Arthrititis Anti-Inflammatory Drugs

Many people are familiar with the new arthritis drugs, Celebrex, Vioxx, and Bextra under any other name. They are so extensively advertised on TV that you, could hardly miss them. Though the ads give the impression that these’ drugs offer a breakthrough in treatment effectiveness, all indications are that they’re no more effective than older and cheaper drugs like ibuprofen and naproxen. What they may offer is a slightly reduced risk of stomach irritation and less risk of bleeding from the stomach. The cost of the newer medicines is five to ten times more than that of the older drugs.

To compare treatment costs and benefits for a nonfatal disease like arthritis, analysts often try to estimate the quality-of-life improvements from a new treatment. This makes it possible to give credit to a treatment that improves quality of life, but doesn’t necessarily make people live longer. This is the situation for most medical treatments.

In the case of the new arthritis drugs, quality of life may be improved over the older drugs because the new drugs cause less belly pain and slightly less risk of bleeding. Because the new drugs reduce bleeding, using them may save some of the money used to treat the bleeding that occurs with the older drugs. Over a long period and many patients, the new drugs may even prevent a small number of deaths, though this is speculation. In fact, some may increase the risk of heart disease, so any benefit for survival is completely unclear.

Analysts try to calculate “quality-adjusted life years” as a way of giving credit to treatments that yield little or no benefit in terms of survival, but improve quality of life. There are some formal, but complicated, ways of trying to estimate how valuable an improvement is. For example, we might ask people how many days or weeks or months of life they’d be willing to give up in exchange for less belly pain and a lower risk of bleeding. That can give us an idea of how many quality-adjusted life years we gain from a treatment. These estimates are crude and controversial, but they give some ballpark figures of value for money.

Some expensive but widely accepted medical treatments cost in the range of $50,000 per quality-adjusted life year gained. Comparing the newer arthritis drugs with the older ones, one credible estimate is that it costs $250,000 plus for each quality-adjusted life year gained.6

 

Lung Volume Reduction Surgery

Some patients with severe emphysema were made better with  lung volume reduction surgery but  some patients are made worse by the operation. Overall, there is no improvement in survival, but there is a modest improvement in quality of life. Among patients who got the operation, medical bills in the first year averaged $63,000, compared with $13,000 for similar patients who got standard nonsurgical treatment.7

No one knows how many patients there are who might benefit from the operation, or how many would want it. But estimates are that offering the treatment will cost Medicare between $1 billion and $15 billion each year. Identifying the small group that benefits most certainly helps to improve cost-effectiveness, but costs are high even for this subgroup.

Medicare is also facing costs for expensive new coronary artery stents, implantable heart defibrillators, and special pumps to help failing hearts. All of these are likely to add billions in costs to a program that's already in financial straits.8 The Medicare board of trustees recently estimated that under current conditions, the Medicare hospital insurance trust fund will be unable to cover its expenses by 2019.9 Given the modest benefits of lung volume reduction surgery, we might reasonably ask if it's good value for money.

 

Pedicle Screws For The Spine

The use of pedicle screws for spinal fusion surgery causes more complications than performing a fusion without the hardware. Pedicle screws generally don’t improve the results, in terms of pain relief and improved function.10 Nonetheless, one group of researchers made the assumption that there was some small advantage in quality of life as a result of using the screws and tried to estimate the cost of adding the screws for each quality-adjusted year of life gained. Their best estimate was that adding pedicle screws to the procedure costs over $3 million per quality-adjusted year of life gained.11 Are there ways to spend $3 million that would have more benefit for more people?

 

Cholesterol Drugs

In many cases, new technology is a good value when doctors use it for certain types of patients, but not for others. The trick is to figure out who benefits most and use the new technology selectively. Cholesterol lowering offers a good example.

For people at high risk of having a heart attack, the use of cholesterol lowering drugs seems to offer good value. In a man over age fifty-five with a cholesterol over three hundred and three other risk factors for heart dis­ease (such as smoking, high blood pressure, and diabetes), treatment with a statin-type drug for lowering cholesterol probably costs about $20,000 per year of life saved.12

But in a low-risk person, the value of treatment is considerably less. For a forty-year-old woman with high cholesterol but no other risk factors, statin therapy would cost about $2 million per year of life saved. 12 Many people would therefore say, don't bother testing for cholesterol in such a low-risk person. But it happens routinely, and many such patients are treated.

So for many treatments, value for money isn't an all-or-nothing thing. For some kinds of patients the value may be excellent, and for others it may be terrible. If doctors aren't highly selective about whom they treat, even the value of effective treatments shrinks fast. Yet past history tells us doctors and patients both have difficulty saying no.

"But wait," you may protest, "all life is precious, and we can't attach a value to it." But we have to realize that the $2 million we would spend to save one year of life for a low-risk person might save many more lives if we used it instead for more efficient treatments. As Richard Lamm, former governor of Colorado, notes, "In public policy, everything we do prevents us from doing something else. Paying for treatment A to patient B, prevents us from delivering treatment Y to patient Z.13

Dr. David Eddy, an expert in clinical decision making and operations research, has offered some excellent examples of how this might work, for example, in a managed-care plan. We won't try to reproduce the math and the details here. But by focusing on treatment strategies that deliver high value for money, a health plan actually saves more lives than by paying for expensive services that provide only minor benefits.14/15

The rapid growth of modestly effective, but very expensive treatments like those described here is the main reason why health insurance costs are rising so fast, with so little to show for it in terms of longevity or other public health statistics. It's also why fewer and fewer people can afford insurance at all. Are these treatments good value for money? We don't pretend to know the answer, but we do know that we can't afford every new test or treatment that will increase costs this much-and there are hun­dreds waiting for a coverage decision.

Richard Lamm, the former governor, argues that unless we address the questions of trade-offs and limits, we'll continue to move enormous amounts of resources into "marginal medicine." He believes that medical school culture, the legal system, and our insurance system are all programmed to maximize marginal medicine.13

Better data on clinical effectiveness and on value for money won't answer the tough questions for us. Decisions about what services to pro­vide and pay for will never be based on economic analyses alone. But socalled cost-effectiveness studies may help to provide the information we need to inform both group and individual value judgments. Unfortunately, the value judgments can't be avoided.

Medical technology is here to stay, and it's a good thing. But it's the primary reason for rising health-care costs, which threaten to leave more and more people uninsured. Rapid medical advances, coupled with a financing sys­tem that pays most of the costs and few mechanisms to evaluate the clinical effectiveness of new advances, create a recipe for inefficient care. Relatively low out-of-pocket costs to patients make price seem irrelevant. Payment systems generally encourage doctors and hospitals to do ever more, and to concentrate on specific lucrative services.
 

1. Toner R, Stolberg SG. Decade after health care crisis, soaring costs bring new strains. The New York Times, August 11, 2002, sec. 1, p.1.

2. Kelly K, Crowley J, Bunn PA Jr, et al. Randomized phase III trial of paclitaxel plus carboplatin versus vinorelbine plus cisplatin in the treatment of patients with advanced non-small-cell lung cancer: A Southwest Oncology Group trial. J Clin Oncol 2001; 19: 3210-3218.

3. Schiller JH, Hartington D, Belani CP, et al. Comparison of four chemotherapy regimens for advanced non-small-cell lung cancer. N Engl J Med 2002; 346: 92-98.

4. Ramsey SD, Moinpour CM, Lovato LC, et al. Economic analysis of vinorelbine m, plus cisplatin versus paclitaxel plus carboplatin for advanced non-small-cell lung `or cancer. J Nat Cancer Inst 2002; 94: 291-297.

5. Ramsey SD, Kessler LG. Does economics matter when treating advanced non­small cell lung cancer? Oncologist 2002; 7: 179-180.

6. Spiegel BM, Targownik L, Dulai GS, Gralnek IM. The cost-effectiveness of cyclooxygenase-2 selective inhibitors in the management of chronic arthritis. Ann Intern Med 2003; 138: 795-806.

7. Ramsey SD, Berry K, Etzioni R, Kaplan RM, Sullivan SD, Wood DE, for the National Emphysema Treatment Trial Research Group. Cost effectiveness of lung- volume-reduction surgery for patients with severe emphysema. N Engl J Med 2003; 348:2092-2102.

8. Kolata G. New therapies pose quandary for Medicare. The New York Times,August 17, 2003, p. 1-1.

s. Pear R. Medicare overseers expect costs to soar in coming decades. The New York Times, March 24, 2004, p. Al.

10. Deyo RA, Nachemson A, Mirza SK. Spinal-fusion surgery-the case for restraint. N Engl J Med 2004; 350: 722-726.

11. Kuntz KM, Snider RK, Weinstein JN, Pope MH, Katz JN. Cost-effectiveness of >r fusion with and without instrumentation for patients with degenerative spondy- ch lolisthesis and spinal stenosis. Spine 2000; 25: 1132-1139.

12. Probstfield JL. How cost-effective are new preventive strategies for cardiovascular disease? Am J Cardiol 2003; 91(suppl): 22G-27G.

13. Lamm RD. Marginal medicine. JAMA 1998; 280: 931-933.
 

See also:  Eddy DM. Cost-effectiveness analysis: A conversation with my father. JAMA 1992;267:1669-1675.

Eddy DM. From theory to practice: Rationing resources while improving quality: How to get more for less. JAMA 1994; 272: 817-824.  Ginsburg PB, Nichols LM. The health care cost-coverage conundrum: The care we want vs. the care we can afford. Center for Studying Heath System Change, Annual Essay, Fall 2003. Available at wwwhschange.org/content/616/.  

 

 

For updates click homepage here

 

 

 

 

shopify analytics