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/.
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