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Other Patient-Level Economic Other Patient-Level Economic OutcomesOutcomes
Todd Wagner, PhDTodd Wagner, PhD
August 8August 8thth, 2007, 2007
Outline of TalkOutline of Talk
Willingness to payWillingness to pay
Employment and (lost) productivityEmployment and (lost) productivity
Economic TheoryEconomic Theory A person’s happiness is dependent on:A person’s happiness is dependent on:
– her consumption of non-health goods (X)her consumption of non-health goods (X)– her health (H)her health (H)– where consumption is limited by income and time (Y)where consumption is limited by income and time (Y)
Without mammogram: V(Y,PWithout mammogram: V(Y,Pxx,H),H) Getting a mammogram costs time and moneyGetting a mammogram costs time and money Trade off for a mammogram -- WTPTrade off for a mammogram -- WTP
V(Y,PV(Y,Pxx,H) = V(Y-WTP,H) = V(Y-WTPmammam,P,Pxx,H),H)
Revealed PreferencesRevealed Preferences Analyses of consumption data provide Analyses of consumption data provide
information on “revealed preferences”information on “revealed preferences” For example, consumers show a For example, consumers show a
preference for iPods over other MP3 preference for iPods over other MP3 playersplayers
Economists can use this information to Economists can use this information to estimate social welfare in a cost-benefit estimate social welfare in a cost-benefit analysisanalysis
Contingent ValuationContingent Valuation Hard to observe revealed preferences in Hard to observe revealed preferences in
health care because of market distortions.health care because of market distortions.– Exceptions for travel costs
Clarke, P. M. (1998). JHE, 17(6), 767-787. Kessler, D. (2005) NBER Working Paper 11419
If preferences are not observable, perhaps they can they be elicited – Contingent valuation
Willingness to PayWillingness to Pay
WTPWTPcvcv can be used as an alternative to can be used as an alternative to utility and QALYsutility and QALYs
Hereafter I use WTP to refer to WTPHereafter I use WTP to refer to WTPcvcv
WTP can be used in a cost-benefit WTP can be used in a cost-benefit analysis or as preference measureanalysis or as preference measure
OverviewOverview
“What would I be willing to pay to avoid ‘x’ or gain ‘y’?”
Academic research roots in environmental economics
Also used in marketing
Benefits of WTPBenefits of WTP People understand the concept People understand the concept Explicit tradeoffExplicit tradeoff Adheres to neoclassical economic theoryAdheres to neoclassical economic theory Many people pay for health careMany people pay for health care Dollar an easy to understand unit as opposed Dollar an easy to understand unit as opposed
to risksto risks May be responsive to small effect not detected May be responsive to small effect not detected
with utilitieswith utilities
Drawbacks of WTPDrawbacks of WTP
Insurance obscures charges and reduces riskInsurance obscures charges and reduces risk Correlation with income makes many Correlation with income makes many
practitioners uncomfortablepractitioners uncomfortable Validity is extremely dependent on framing of Validity is extremely dependent on framing of
question and response scalequestion and response scale Vulnerable to social desirabilityVulnerable to social desirability
– No limit on willing to pay No limit on willing to pay – Never willing to payNever willing to pay
What to AskWhat to Ask
User based ex-post vs. insurance based ex-anteUser based ex-post vs. insurance based ex-ante Who pays: public versus privateWho pays: public versus private Results: certainty or uncertainResults: certainty or uncertain
FramingFraming– Realism of taskRealism of task– Extent of descriptionExtent of description
Mode of AdministrationMode of Administration In person interviewing In person interviewing
– can positively bias responses through social can positively bias responses through social desirabilitydesirability
– Allows for probes and potentially greater Allows for probes and potentially greater accuracyaccuracy
Paper and web surveysPaper and web surveys– May avoid social desirabilityMay avoid social desirability– Any confusion may not be resolvedAny confusion may not be resolved
Response CategoriesResponse CategoriesPreferred
– Payment cards/scales Maximum amount is WTP This method biases estimates of variation
– Dichotomous response Randomly assign price, person asked yes or no Requires large sample WTP is estimated in a maximum likelihood logit model
Avoid– Open ended– Bidding games
NOAA. (1992). Report of the National Oceanic and Atmospheric Administration. Federal Registry, 58(10), 4601-4614.
Question DevelopmentQuestion Development WTP question must be tailored for each studyWTP question must be tailored for each study No standard WTP questionNo standard WTP question Pre-testing is highly recommendedPre-testing is highly recommended
– Dillman methodDillman method– Modify the questionModify the question– Identify the response scale rangeIdentify the response scale range
Assess validity– Correleted with income– Scope: WTP should vary by scope of benefits
Dillman, D. (2000). Mail and Internet Surveys: The Tailored Design Method (Second ed.). New York: JohnWiley and Sons, Inc.
ExampleExample
Pathfinders: NCI funded behavioral intervention that sought to improve cancer screening among ethnically diverse women
in the SF. Bay Area.
Focus GroupsFocus Groups Conducted focus groups and individual interviews
with low income women representing five race / ethnic groups (African American, Chinese, Filipino, Latino, and white) and four languages (English, Chinese, Spanish and Tagalog).
Focus group facilitators were women of approximately the same age and same race/ethnicity
All focus groups were tape recorded with consent
Question DevelopmentQuestion Development
Discussed use of mammography, paying for health care
Showed example WTP questions and had them discuss them
Identified range of WTP responsesIdentified range of WTP responses Forward and back translation into non-Forward and back translation into non-
English languagesEnglish languages
WTP QuestionWTP Question
The next questions ask how important you think mammograms are. I am The next questions ask how important you think mammograms are. I am going to ask how much you would be willing to pay to get a mammogram. going to ask how much you would be willing to pay to get a mammogram. Please be assured that answering these questions will not increase the cost of Please be assured that answering these questions will not increase the cost of any medical services. Your answer simply tells us what the mammogram is any medical services. Your answer simply tells us what the mammogram is worthworth to you in dollars. Okay, here are the questions. to you in dollars. Okay, here are the questions.
1. Many women get mammograms free of charge. But suppose that there was 1. Many women get mammograms free of charge. But suppose that there was no way to get a free mammogram. Would you get a mammogram if it cost no way to get a free mammogram. Would you get a mammogram if it cost $75?$75?
(PROBE):(PROBE): Considering what you Considering what you can afford right nowcan afford right now, would you be willing , would you be willing to payto pay $75 $75 for a mammogram? for a mammogram?
Question ValidationQuestion Validation
The validity was tested with a random sample of 52 low-income, ethnically diverse women in the San Francisco area.
Internal validity– correlation with income Construct validity– correlation with past
behaviors
Wagner, T. H., Hu, T.-w., Dueñas, G. V., & Pasick, R. J. (2000). Willingness to pay for mammography: item development and testing among five ethnic groups. Health Policy, 53(2), 105-121.
Pathfinders InterventionPathfinders Intervention
Enrolled 1463 womenEnrolled 1463 women Collected baseline data, including WTPCollected baseline data, including WTP Randomized to educational intervention Randomized to educational intervention
and control (usual care)and control (usual care) 24 month follow-up24 month follow-up
Baseline dataBaseline data
1419 respondents as of early-April 20001419 respondents as of early-April 2000
final ethnicity | Freq. Percent-----------------------+-----------------------Black/African American | 499 35.17 Chinese | 181 12.76 Filipina | 142 10.01 Latina | 297 20.93 White | 300 21.14-----------------------+----------------------- Total | 1419 100.00
Wagner, T. H., Hu, T.-w., Dueñas, G. V., Kaplan, C. P., Pasick, R. J., & Nguyen, B. H. (2001). Does willingness to pay vary by race/ethnicity? An analysis of mammography among low-income women. Health Policy, 58, 275-288.
Sample CharacteristicsSample Characteristics Survey in English 996 (70%) Survey in English 996 (70%) 39% of sample was foreign born 39% of sample was foreign born Proportion of life in USProportion of life in US
– Black/African American 0.99Black/African American 0.99– Chinese 0.33 Chinese 0.33 – Filipina 0.40 Filipina 0.40 – Latina 0.52Latina 0.52– White 0.97White 0.97
Baseline characteristics (cont.)Baseline characteristics (cont.) 1.14% had never heard of mammogram1.14% had never heard of mammogram 87% had a mammogram in their lifetime87% had a mammogram in their lifetime 83% had mammogram in last 5 years83% had mammogram in last 5 years Stages of changeStages of change
– precontemplation 5%precontemplation 5%
– contemplation 30%contemplation 30%
– action 12%action 12%
– maintenance 38%maintenance 38%
– relapse 14%relapse 14%
WTPWTP Average WTP $131 (SD 92; Range 0-500)Average WTP $131 (SD 92; Range 0-500)
wtp
-.065734.065734
0
130
500
ethn: Black/African American
-.06445.06445
0
75
500
ethn: Chinese
-.069484.069484
0
100
500
ethn: Filipina
-.068198.068198
0
100
500
ethn: Latina
-.05359.05359
0
130
500
ethn: White
p<.0001
WTP by stages of changeWTP by stages of changewtp
-.068524.068524
0
75
500
stage: precont
-.061237.061237
0
100
500
stage: contem
-.057168.057168
0
125
500
stage: action
-.0621 .0621
0
130
500
stage: maint
-.063448.063448
0
100
500
stage: relap p<.0001
Mother, daughter or sister with breast cancerMother, daughter or sister with breast cancer
141
128
122
133
110
115
120
125
130
135
140
145
Chinese, Filipina,White
AA / Latina
YesNo
Thistles and ThornsThistles and Thorns
Refused to answer 4 (0.3%)Refused to answer 4 (0.3%) Don’t know 26 (1.8%)Don’t know 26 (1.8%) No limit 95 (6.7%)No limit 95 (6.7%) Pay nothing 55 (3.9%)Pay nothing 55 (3.9%)
WTP and CBAWTP and CBA Cost benefit analysis compares costs to Cost benefit analysis compares costs to
monetized monetized benefitsbenefits CEA exists because people prefer CEA exists because people prefer
QALYs over QALYs over monetized monetized benefitsbenefits WTP is a measure of monetized benefitsWTP is a measure of monetized benefits Net benefit=WTP-CostsNet benefit=WTP-Costs Objective function: net benefit >0Objective function: net benefit >0
EmploymentEmployment Employment outcomes are typically excluded Employment outcomes are typically excluded
from a CEA because these effects are included from a CEA because these effects are included in the denominator (QALYs).in the denominator (QALYs).
However, employment may be an important However, employment may be an important outcome in its own right oroutcome in its own right or
CEA may be using another outcome that does CEA may be using another outcome that does not reflect employment (e.g., mortality)not reflect employment (e.g., mortality)
Typical (Bad) QuestionsTypical (Bad) Questions Are you currently working at a paying job?Are you currently working at a paying job?
□□ Full time Full time □□ Part time Part time □□ Not workingNot working
Please check one of the followingPlease check one of the following□□ working full time working full time □□ working part timeworking part time□□ homemakerhomemaker□□ studentstudent□□ unemployedunemployed□□ retiredretired
BLS on Being EmployedBLS on Being Employed Persons 16 years and over in the civilian noninstitutional Persons 16 years and over in the civilian noninstitutional
population who, during the reference week, (a) did any work population who, during the reference week, (a) did any work at all (at least 1 hour) as paid employees; worked in their own at all (at least 1 hour) as paid employees; worked in their own business, profession, or on their own farm, or worked 15 hours business, profession, or on their own farm, or worked 15 hours or more as unpaid workers in an enterprise operated by a or more as unpaid workers in an enterprise operated by a member of the family; and (b) all those who were not working member of the family; and (b) all those who were not working but who had jobs or businesses from which they were but who had jobs or businesses from which they were temporarily absent because of vacation, illness, bad weather, temporarily absent because of vacation, illness, bad weather, childcare problems, maternity or paternity leave, labor-childcare problems, maternity or paternity leave, labor-management dispute, job training, or other family or personal management dispute, job training, or other family or personal reasons, whether or not they were paid for the time off or were reasons, whether or not they were paid for the time off or were seeking other jobs. Excluded are persons whose only activity seeking other jobs. Excluded are persons whose only activity consisted of work around their own house (painting, repairing, consisted of work around their own house (painting, repairing, or own home housework) or volunteer work for religious, or own home housework) or volunteer work for religious, charitable, and other organizations. charitable, and other organizations.
UnemployedUnemployed Persons aged 16 years and older who had no Persons aged 16 years and older who had no
employment during the reference week, employment during the reference week, were were available for workavailable for work, except for temporary , except for temporary illness, illness, and had made specific efforts to find and had made specific efforts to find employment sometime during the 4-week employment sometime during the 4-week period ending with the reference weekperiod ending with the reference week. . Persons who were waiting to be recalled to a Persons who were waiting to be recalled to a job from which they had been laid off need not job from which they had been laid off need not have been looking for work to be classified as have been looking for work to be classified as unemployed. unemployed.
Out of Labor ForceOut of Labor Force
People who are not employed and not People who are not employed and not actively lookingactively looking
Class ExerciseClass Exercise
For employment status, how does BLS For employment status, how does BLS classify:classify:– military personnelmilitary personnel
– veteransveterans
– prison inmatesprison inmates
Measuring EmploymentMeasuring Employment Paid employmentPaid employment Employer (self or company)Employer (self or company) Hours of employmentHours of employment Productivity / lost productivityProductivity / lost productivity Absenteeism / presenteeismAbsenteeism / presenteeism Income / assetsIncome / assets Occupation (typically of little value)Occupation (typically of little value)
Employment MattersEmployment Matters
Diseases can affect overall employmentDiseases can affect overall employment– DepressionDepression– Arthritis– Stroke– Back pain
Diseases can affect willingness to start own company– Depression
ProductivityProductivity Many illnesses can affect productivity Many illnesses can affect productivity
and absenteeismand absenteeism– MigraineMigraine– IncontinenceIncontinence– UlcersUlcers– DepressionDepression– Substance UseSubstance Use– Back painBack pain
QuestionnairesQuestionnaires No gold standard exists for employment, No gold standard exists for employment,
assets, and incomeassets, and income Many people use questions from national Many people use questions from national
surveyssurveys PSID (Panel Study of Income Dynamics)PSID (Panel Study of Income Dynamics) AHEAD (Asset and Health Dynamics Among the AHEAD (Asset and Health Dynamics Among the
Oldest Old) Oldest Old) HRS (Health and Retirement Survey)HRS (Health and Retirement Survey) Bureau of Labor Statistics (www.bls.gov/ers/home.htm)Bureau of Labor Statistics (www.bls.gov/ers/home.htm)
Two measures of lost productivityTwo measures of lost productivity
Example of Tailored QuestionsExample of Tailored Questions
Partners in Care (depression)Partners in Care (depression)http://www.rand.org/health/projects/pic/measures/tcimeasure/cidi-tci.htmlhttp://www.rand.org/health/projects/pic/measures/tcimeasure/cidi-tci.html
23 pages of detailed questions on assets, 23 pages of detailed questions on assets, income, wealth for respondent and income, wealth for respondent and family.family.
Based on Health and Retirement Survey.Based on Health and Retirement Survey.
Heath and Work Performance Questionnaire (HPQ)
http://www.hcp.med.harvard.edu/hpq/http://www.hcp.med.harvard.edu/hpq/
How many hours does your employer expect you to work in a typical 7-day week?
In the past 4 weeks (28 days), how many days did you...– ...miss an entire work day because of problems with your
physical or mental health?– ...miss part of a work day because of problems with your
physical or mental health? (Please include only days missed for your own health, not someone else’s health.)
Work and Health InterviewWork and Health Interview In the past 4 weeks, how many In the past 4 weeks, how many hours per weekhours per week, on average, , on average,
did you work? did you work? ______________# of hours ______________# of hours
In the past 4 weeks, how many total, full In the past 4 weeks, how many total, full daysdays of work did you of work did you missmiss for health reasons? These would be days you did not go for health reasons? These would be days you did not go to work at all.to work at all. ______________# days______________# days
For a number of reasons (illnesses, poor concentration, For a number of reasons (illnesses, poor concentration, fatigue) people are not as productive as they can be at work all fatigue) people are not as productive as they can be at work all the time. In the past 4 weeks, how many the time. In the past 4 weeks, how many hours per weekhours per week, on , on average, were you average, were you notnot productiveproductive??
______________# of hours ______________# of hours
Note: wording from earlier version and it may have changedNote: wording from earlier version and it may have changedStewart et al. Lost Productive Time Due to Common Pain… JAMA 2003Stewart et al. Lost Productive Time Due to Common Pain… JAMA 2003
Barriers to Measuring EmploymentBarriers to Measuring Employment People who receive public benefits face a People who receive public benefits face a
disincentive to workdisincentive to work– Income from work must outweigh benefitsIncome from work must outweigh benefits– Incentives to work “under the table”Incentives to work “under the table”– Incentives to bill year’s work in a month or twoIncentives to bill year’s work in a month or two
These “perverse” incentives lead Congress to These “perverse” incentives lead Congress to enact the 1996 welfare reformsenact the 1996 welfare reforms
Veterans who receive means-tested public Veterans who receive means-tested public benefits also face a disincentivebenefits also face a disincentive
Other ProblemsOther Problems
For an outcome measure, avoid using labeled For an outcome measure, avoid using labeled categories (e.g., full time or part time)categories (e.g., full time or part time)
Measure hours of workMeasure hours of work Other issues to considerOther issues to consider
– UnionsUnions– Worksite health programsWorksite health programs– ChildcareChildcare– Health of family membersHealth of family members
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