The fiscal consequences of public health investments in disease-modifying therapies for the treatment of multiple sclerosis in Sweden

Abstract

Background and aims: The economic consequences of multiple sclerosis (MS) are broader than those observed within the health system. The progressive nature suggests that people will not be able to live a normal productive life and will gradually require public benefits to maintain living standards. This study investigates the public economic impact of MS and how investments in disease-modifying therapies (DMTs) influence the lifetime costs to government attributed to changes in lifetime tax revenue and disability benefits based on improved health status linked to delayed disease progression.

Methods: Disease progression rates from previous MS Markov cohort models were applied to interferon beta-1a, peginterferon beta-1a, dimethyl fumarate, and natalizumab using a public economic framework. The established relationship between expanded disability status scale and work-force participation, annual earnings, and disability rates for each DMT were applied. Subsequently, we assessed the effect of DMTs on discounted governmental costs consisting of health service costs, social insurance and disability costs, and changes in lifetime tax revenues.

Results: Fiscal benefits attributed to informal care and community services savings for interferon beta-1a, peginterferon beta-1a, dimethyl fumarate, and natalizumab were SEK340,387, SEK486,837, SEK257,330, and SEK958,852 compared to placebo, respectively. Tax revenue gains linked to changes in lifetime productivity for interferon beta-1a, peginterferon beta-1a, dimethyl fumarate, and natalizumab were estimated to be SEK27,474, SEK39,659, SEK21,661, and SEK75,809, with combined fiscal benefits of cost savings and tax revenue increases of SEK410,039, SEK596,592, SEK326,939, and SEK1,208,023, respectively.

Conclusion: The analysis described here illustrates the broader public economic benefits for government attributed to changes in disease status. The lifetime social insurance transfer costs were highest in non-treated patients, and lower social insurance costs were demonstrated with DMTs. These findings suggest that focusing cost-effectiveness analysis only on health costs will likely underestimate the value of DMTs.     

Medical costs in patients with heart failure after acute heart failure events: one-year follow-up study

Aims: This study investigated annual medical costs using real-world data focusing on acute heart failure.

Methods: The data were retrospectively collected from six tertiary hospitals in South Korea. Overall, 330 patients who were hospitalized for acute heart failure between January 2011 and July 2012 were selected. Data were collected on their follow-up medical visits for 1 year, including medical costs incurred toward treatment. Those who died within the observational period or who had no records of follow-up visits were excluded. Annual per patient medical costs were estimated according to the type of medical services, and factors contributing to the costs using Gamma Generalized Linear Models (GLM) with log link were analyzed.

Results: On average, total annual medical costs for each patient were USD 6,199 (±9,675), with hospitalization accounting for 95% of the total expenses. Hospitalization cost USD 5,904 (±9,666) per patient. Those who are re-admitted have 88.5% higher medical expenditure than those who have not been re-admitted in 1 year, and patients using intensive care units have 19.6% higher expenditure than those who do not. When the number of hospital days increased by 1?day, medical expenses increased by 6.7%.

Limitations: Outpatient drug costs were not included. There is a possibility that medical expenses for AHF may have been under-estimated.

Conclusion: It was found that hospitalization resulted in substantial costs for treatment of heart failure in South Korea, especially in patients with an acute heart failure event. Prevention strategies and appropriate management programs that would reduce both frequency of hospitalization and length of stay for patients with the underlying risk of heart failure are needed.     

Modeling the fiscal costs and benefits of alternative treatment strategies in the United Kingdom for chronic hepatitis C

Background: Hepatitis C (HCV) infection causes substantial direct health costs, but also impacts broader societal and governmental costs, such as tax revenue and social protection benefits. This study investigated the broader fiscal costs and benefits of curative interventions for chronic Hepatitis C (CHC) that allow individuals to avoid long-term HCV attributed health conditions.

Methods: A prospective cohort model, assessing the long-term fiscal consequences of policy decisions, was developed for HCV infected individuals, following the generational accounting analytic framework that combines age-specific lifetime gross taxes paid and governmental transfers received (i.e. healthcare and social support costs). The analysis assessed the burden of a theoretical cohort of untreated HCV infected patients with the alternative of treating these patients with a highly efficacious curative intervention (ledipasvir/sofosbuvir [LDV/SOF]). It also compared treating patients at all fibrosis stages (Stages F0–F4) compared to late treatment (Stage F4).

Results: Based on projected lifetime work activity and taxes paid, the treated cohort paid an additional £5,900 per patient compared to the untreated cohort. Lifetime government disability costs of £97,555 and £125,359 per patient for treated cohort vs no treatment cohort were estimated, respectively. Lifetime direct healthcare costs in the treated cohort were £32,235, compared to non-treated cohort of £26,424, with an incremental healthcare costs increase of £5,901 per patient. The benefit cost ratio (BCR) of total government benefits and savings relative to government treatment costs (including LDV/SOF) ranged from 1.8–5.6. Treating patients early resulted in 77% less disability costs, 43% lower healthcare costs, and 33% higher tax revenue.

Conclusion: The ability to cure Hepatitis C offers considerable fiscal benefits beyond direct medical costs and savings attributed to reduced disability costs, public allowances, and improved tax revenue. Changes in parameters, such as productivity, wage growth, and tax rates, can influence the conclusions described here.     

医疗服务递送机制中主体利益关系及扭曲矫正——基于政府职能的视角

医疗服务递送机制中涉及到医疗服务机构、医生、药企和患者四方利益主体。当前我国这些利益主体之间种种不合理的利益"合作"与"冲突",均与医疗服务递送机制中政府职能的缺位和错位存在着直接关系。在进一步深化医改的过程中,我国政府应当正确地履行好理应承担的公共职能,即加强对卫生资源的合理规划与配置;加大对公立医院的财政投入并优化对其补偿机制;加强对医疗服务机构与药品行业的监管;加强医药信息披露机制建设;鼓励医药卫生服务市场公平竞争,并放弃不适当的医药价格管制。     

Medical economic impact of tracheotomy patients on a hospital system

Abstract

Background:

Tracheotomy patients are a small portion of hospitalizations, but account for disproportionately high risk and costs. There are many complex decisions that go into the care of these patients, and practice variation is expected to be compounded in a health system. This study sought to characterize the medical economic impact of tracheotomy patients on the hospital system.

Methods:

A retrospective review of the health system’s hospital billing software was performed for 2013, and pertinent outcomes measures were tabulated.

Results:

There were 829 tracheotomies performed in the health system of seven hospitals, with total costs of $128,883,865. Average length of stay was 36.74 days for principal procedures, and 43.36 days for tracheotomy as secondary procedures. Mortality was ～18% overall, and re-admissions were 10.93% for primary, and 14.36% for secondary procedures. A fairly wide variation in each category among the different hospitals was observed.

Conclusions:

There are potentially many factors that impact variations of care and outcomes in patients with tracheotomy. Due to their large economic impact and risks for morbidity and mortality, a formalized care pathway is warranted. Goals of the pathway should include understanding medical decisions surrounding these complex patients, monitoring pertinent outcomes, reducing practice variation, and improving the efficiency of compassionate care.     

Standard costs of regional public rail passenger transport: evidence from Italy

ABSTRACT

The paper estimates the standard cost in Italian regional public rail passenger transport services (LPTR), depending on service characteristics. The results highlight the crucial role of: number of seats per ride, commercial speed, service size and length of rail tracks. The model also shows the positive link between investment in rolling stock and the unit cost of the service. Finally, based on the empirical evidence, we propose regulatory adjustments to accomplish policy targets regarding the fair allocation of public LPTR funds to Regions and Local Authorities and a more efficient use of (scarce) local and national public resources.     

Retrospective analysis of patients with advanced or metastatic gastric cancer in Colombia

Abstract

Aims: To assess patient and disease characteristics, treatment patterns, and associated costs in patients with advanced or metastatic gastric cancer (A/MGC) in Colombia, in both the public and private hospitals.

Materials and methods: A total of 145 patients who had received first-line chemotherapy treatment (platinum analog and/or a fluoropyrimidine) and were followed for at least 3 months after the last administration of a first-line cytotoxic agent were eligible for inclusion. Case-report forms were elaborated based on the patients’ medical records from three Colombian hospitals. Estimates of treatment costs were calculated using unit costs from the participating hospitals.

Results: Of the 145 patients, more than half (64.83%) were male, 79.56% were diagnosed with metastatic stage IV disease (mean age = 58.14?years). Prior to MGC diagnosis, 31.71% of the patients being operated on received a total gastrectomy; 66.9% of the patients received a doublet therapy, of which 5-fluorouracil (5-FU) in combination with cisplatin was the standard treatment (14%), followed by combination with leucovorin (12%). Only around 10% of the patients responded to first-line treatment. Out of 41.38% of the patients who received a second-line treatment, 71.67% were still administered a platinum analog and/or fluoropyrimidine. During the follow-up period, 52% of the patients progressed and 20% achieved stable disease. Best supportive care mostly consisted of outpatient visits after last line-therapy (72.41%), palliative radiotherapy (18.6%), and surgery (37.2%).

Limitations and conclusions: Gastric cancer is one of the main causes of cancer-related death in Colombia, as most of the patients are diagnosed at an advanced stage, when prognosis is poor. Treatment patterns are highly heterogeneous. Second-line treatments were mostly initiated with paclitaxel, capecitabine, irinotecan, or cisplatin.     

Estimating the public economic consequences of introducing varenicline smoking cessation therapy in South Korea using a fiscal analytic framework

Background and aims: Smoking gives rise to many cross-sectorial public costs and benefits for government. Costs arise from increased healthcare spending and work-related social benefits, while smoking itself provides significant revenue for government from tobacco taxes. To better understand the public economic impact of smoking and smoking cessation therapies, this study developed a government perspective framework for assessing smoking-attributable morbidity and mortality and associated public costs. This framework includes changes in lifetime tax revenue and health costs, as well as changes in tobacco tax revenue, from fewer smokers.

Methods: A modified generational accounting framework was developed to assess relationships between smoking-attributable morbidity and mortality and public economic consequences of smoking, including lifetime tax revenue gains/losses, government social transfers, and health spending. Based on the current prevalence of smoking in South Korean males, a cohort model was developed for smokers, former-smokers, and never-smokers. The model simulated the lifetime discounted fiscal transfers for different age cohorts in 5 year age bands, and the return on investment (ROI) from smoking cessation therapy.

Results: Former smokers are estimated to generate higher lifetime earnings and direct tax revenues and lower lifetime healthcare costs due to the reduction of smoking-attributable mortality and morbidity compared to smokers, even after accounting for reduced tobacco taxes paid. Based on the costs of public investments in varenicline, this study estimated a ROI from 1.4–1.7, depending on treatment age, with higher ROI in younger cohorts, with an average ROI of 1.6 for those aged less than 65.

Conclusions: This analysis suggests that reductions in smoking can generate positive public economic benefits for government, even after accounting for lost tobacco tax revenues. The results described here are likely applicable to countries having similar underlying smoking prevalence, comparable taxation rates, and social benefit protection provided to individuals with smoking-related conditions.     

Export Product Diversification and Public Revenue’s Dependence on Resource Revenue

ABSTRACT

This article tries to reconcile two major priorities for countries, notably resource-rich countries on the international development agenda: export product diversification with a view to helping them better integrate into the multilateral trading system and tax reforms with a view to reducing the dependence of total public revenue on resource revenue, and therefore developing a more sustainable stream of public revenue. The analysis therefore involves examining empirically the impact of export product diversification on countries’ overall public revenue dependence on resource revenue, this dependence being measured by the share of resource revenue in total public revenue. The empirical analysis shows that export product diversification exerts a negative and significant impact on resource revenue share of total public revenue, and therefore could help facilitate tax reforms towards lower resource revenue dependence. Hence, while tax policy is the main policy tool to conduct tax reforms, export product diversification would likely contribute to facilitating the implementation of these reforms.     

How much could be saved in Chinese hospitals in procurement of anti-hypertensives and anti-diabetics?

Background: Efficient use of government funding has been increasingly relevant for the success and sustainability of ongoing health-system reform in China; however, as there is no generic substitution policy, patients and basic health-insurance programs pay more for public-preferred brand originators. Such phenomenon is especially typical in public hospitals. The objective of this study is to estimate the potential cost savings in procurement by Chinese public hospitals when switching from brand originators of anti-hypertensive and anti-diabetic medications to their generic equivalents between 2012–2014.

Method: IMS Health volume and value consumption data (IMS China Hospitals Audit system 2012–2014) were used, which covered all Chinese hospitals with 100 beds and above. The top 60% IMS volume consumption of respective anti-hypertensive and anti-diabetic medication with unique dosage form and strength were included. The potential cost savings were calculated from a switch of brand originators with their generic equivalents on the Chinese and international market. An independent sample t-test was conducted to compare the difference of proportion of cost savings in value between the Chinese and international market.

Results: An average of 44% (US$44 million) and 87% (US$90 million) and a total of US$1.4 and 2.8 billion (2014?US$) could be saved from a switch from originator brand anti-hypertensives and anti-diabetics to domestically and internationally available generic equivalents, respectively. The differences of cost savings (in proportion) between domestic and international market were statistically significant (α?=?0.005, p?=?0.003, p?=?0.002, p?=?0.000).

Conclusion: Expensive brand originators dominated the anti-hypertensive and anti-diabetic market in Chinese hospitals between 2012–2014. Preference of brand originators wastes a huge amount of health resources in China and these limited resources could have been used more efficiently. As one of the world’s key generic suppliers, if China wants to use its health resource more efficiently on medicines, comprehensive measures are needed to address both demand-side (consumers’ low trust in the quality of local generics) and supply-side barriers (health professionals’ preference of brand originators).     

Reduced medical spending associated with increased use of a remote diabetes management program and lower mean blood glucose values

Abstract

Aims: Many new mobile technologies are available to assist people in managing chronic conditions, but data on the association between the use of these technologies and medical spending remains limited. As the available digital technology offerings to aid in diabetes management increase, it is important to understand their impact on medical spending. The aim of this study was to investigate the financial impact of a remote digital diabetes management program using medical claims and real-time blood glucose data.

Materials and methods: A retrospective analysis of multivariate difference-in-difference and instrumental variables regression modeling was performed using data collected from a remote digital diabetes management program. All employees with diabetes were invited, in a phased introduction, to join the program. Data included blood glucose (BG) values captured remotely from members via connected BG meters and medical spending claims. Participants included members (those who accepted the invitation, n?=?2,261) and non-members (n?=?8,741) who received health insurance benefits from three self-insured employers. Medical spending was compared between people with well-controlled (BG ≤ 154?mg/dL) and poorly controlled (BG > 154?mg/dL) diabetes.

Results: Program access was associated with a 21.9% (p?<?0.01) decrease in medical spending, which translates into a $88 saving per member per month at 1 year. Compared to non-members, members experienced a 10.7% (p?<?0.01) reduction in diabetes-related medical spending and a 24.6% (p?<?0.01) reduction in spending on office-based services. Well-controlled BG values were associated with 21.4% (p?=?0.03) lower medical spending.

Limitations and conclusions: Remote digital diabetes management is associated with decreased medical spending at 1 year. Reductions in spending increased with active utilization. It will be beneficial for future studies to analyze the long-term effects of the remote diabetes management program and assess impacts on patient health and well-being.     

社会医疗保障改革的福利效应:以中国城镇为例

This paper evaluates Chinese public health insurance reform enforced since 1998 in terms of its welfare effects. We evaluate China health insurance reform since 1998 using the China Health and Nutrition Surveys (CHNS) data with relevant econometric models. The results of empirical studies show that the public health insurance status has significant impact on medical service utilization and expenditure. The reform reduces the positive effect of public health insurance on medical service utilization, meaning the utilization gap is narrowed after the reform. However, the empirical studies find that the medical expenditure growth of the sample individuals in urban China has not been controlled after the Basic Medical Insurance (BMI) program even if a new co-payment is enforced. Two main reasons for this failure might be the rising cost of medical service and physician’s severe moral hazard, while both of them come from no managed care mechanism for medical service providers in China.      

THE IMPACT OF GREATER AUTONOMY ON EFFICIENCY OF WORK AND QUALITY OF SERVICES IN PUBLIC SERVICE PROVIDERS: A CASE OF VOCATIONAL EDUCATION INSTITUTIONS

ABSTRACT: The paper analyses impact of greater autonomy on efficiency of work and quality of services in public service institutions. Autonomy is one of the key principles of New Public Management that, according to the theory, increases performance in public service providers. However this assumption has been scarcely researched in practice. To narrow this gap, the experimental reform that implemented greater managerial and financial autonomy in 13 Lithuanian state vocational schools was chosen for research. In order to analyse the impact of autonomy after the reform, maximally similar institutions (those that underwent the reform and that did not) are compared using quantitative (incl. counterfactual analysis) and qualitative methods. The results indicate that institutions that have been reformed tend to have better efficiency and quality of services, even though this relationship is not causal. Moreover, the research challenges the notion that such results came from greater autonomy. Finally, the logic of the NPM of as to why more autonomous institutions perform better is also challenged.     

Real-world dosing and drug costs with everolimus or axitinib as second targeted therapies for advanced renal cell carcinoma: a retrospective chart review in the US

Objective:

To describe dosing patterns and to compare the drug costs per month spent in progression-free survival (PFS) among patients with advanced renal cell carcinoma (aRCC) treated with everolimus or axitinib following a first tyrosine kinase inhibitor (TKI).

Methods:

A medical record retrospective review was conducted among medical oncologists and hematologists/oncologists in the US. Patient eligibility criteria included: (1) age ≥18 years; (2) discontinuation of first TKI (sunitinib, sorafenib, or pazopanib) for medical reasons; (3) initiation of axitinib or everolimus as a second targeted therapy during February 2012–January 2013. Real-world dosing patterns were summarized. Dose-specific drug costs (as of October 2014) were based on wholesale acquisition costs from RED BOOK Online. PFS was compared between everolimus and axitinib using a multivariable Cox proportion hazards model. Everolimus and axitinib drug costs per month of PFS were compared using multivariable gamma regression models.

Results:

A total of 325 patients received everolimus and 127 patients received axitinib as second targeted therapy. Higher proportions of patients treated with axitinib vs everolimus started on a higher than label-recommended starting dose (14% vs 2%) or experienced dose escalation (11% vs 1%) on second targeted therapy. The PFS did not differ significantly between patients receiving everolimus or axitinib (adjusted hazard ratio (HR)?=?1.16; 95% confidence interval [CI]?=?0.73–1.82). After baseline characteristics adjustment, axitinib was associated with 17% ($1830) higher drug costs per month of PFS compared to everolimus ($12,467 vs $10,637; p?<?0.001).

Limitations:

Retrospective observational study design and only drug acquisition costs considered in drug costs estimates.

Conclusions:

Patients with aRCC receiving axitinib as second targeted therapy were more likely to initiate at a higher than label-recommended dose and were more likely to dose escalate than patients receiving everolimus. With similar observed durations of PFS, drug costs were significantly higher—by 17% per month of PFS—with axitinib than with everolimus.     

Real-world utilization of molecular diagnostic testing and matched drug therapies in the treatment of metastatic cancers

Aims: To assess the frequency of biopsies and molecular diagnostic testing (human DNA/RNA analysis), anti-cancer drug use (genomically-matched targeted therapy [GMTT], unmatched targeted therapy [UTT], endocrine therapy [ET], and chemotherapy [CT]), and medical service costs among adults with metastatic cancer.

Methods: Adults diagnosed with metastatic breast, non-small cell lung (NSCLC), colorectal, head and neck, ovarian, and uterine cancer (2010Q1–2015Q1) were identified in the OptumHealth Care Solutions claims database and followed from first metastatic diagnosis for ≥1 month and until the end of data availability. Utilization was assessed for each cancer cohort (all and patients aged ≥65 years); per-patient-per-month (PPPM) medical service costs were assessed for all patients. Testing frequency estimates were applied to Surveillance, Epidemiology, and End Results Program data to estimate the number of untested patients (2010–2014).

Results: Patients with metastatic cancer (n?=?8,193; breast [n?=?3,414], NSCLC [n?=?2,231], colorectal [n?=?1,611], head and neck [n?=?511], ovarian [n?=?275], and uterine [n?=?151]) were 63 years old (mean), with 11.1–22.2 months of observation. Biopsy and molecular diagnostic testing frequencies ranged from 7% (uterine) to 73% (ovarian), and from 34% (head and neck) to 52% (breast), respectively. Few were treated with GMTT (breast, 11%; NSCLC, 9%; colorectal, 6%). Treatment with UTT ranged from 0.7% (uterine) to 21% (colorectal). Biopsy, diagnostic testing, and anti-cancer drug therapy were less frequent for those ≥65 years. Medical service costs (PPPM, mean) ranged from $6,618 (head and neck) to $9,940 (ovarian). The estimated number of untested new patients with metastatic cancer was 636,369 (all) and 341,397 (≥65).

Limitations: In addition to the limitations of claims analyses, diagnostic testing frequency may be under-estimated if patients underwent testing prior to study inclusion.

Conclusions: The low frequency of molecular diagnostic testing suggests there are opportunities to better inform management of patients with advanced cancer, particularly decisions to treat with GMTT.