Cost-Effectiveness in Radiology

Jeffrey Shyu

Cost-Effectiveness in Radiology

OIG analysis of Part B data, 2007

Cost-Effectiveness in Radiology

http://www.ifhp.com/

Cost Effectiveness in Radiology

Cost Effectiveness in Radiology

NLST

• Methods– Three strategies: screening with CT,

screening with XR, no screening– QALY, ICER, cost per person estimates

NLST

• Results (CT compared to no screening)• Per person:

– Additional $1631– Additional 0.0316 life-years– Additional 0.0201 QALYs– ICERs

• $52,000 per life-year gained• $81,000 per QALY gained

– Wide variability

Lung Cancer Screening

• McMahon 2011– Up to $169,000/QALY

• Pyenson 2012– Less than $19,000 per life-year saved

Decision Analysis

• Identify and bound decision problem• Create decision tree• Fill in the tree

– Data collection, expert opinions• Calculate expected value• Sensitivity analysis

– Evaluate uncertainty and test conclusions

Cost

Cost Analysis• Direct Costs

– Decision leads to resource utilization directly– CT, staff costs, physician payments, additional workup for

positive results, lung cancer treatment• Medicare Physician Fee Schedule

• Indirect Costs– Changes in resource use leading to increased or decreased

productivity– Opportunity costs (time, etc.)

• BLS data

https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PFSLookup/index.html?redirect=/pfslookup/02_PFSsearch.asphttp://www.bls.gov/news.release/archives/ecec_03102010.pdf

Cost Analysis

Effectiveness

QALYs

Expected Value• Weighted average of possible values of a random

variable

• Bet on a horse– Probability of winning: 10%– Potential net winnings: $1000– Costs $200 to play

• E(b) = $1000*0.1 - $200*0.9 = - $80

Expected Value

• Expected value for two different treatment regimens

• Surgery + Medical Treatment• Medical treatment alone

• E(x) = 0.6*40 + 0.3*25 + 0.1*0 = 31.5 QALYs gained• E(y) = 0.7*40 + 0.15*20 + 0.15*0 = 31 QALYs gained

Standard Gamble

Time Trade Off

Measuring and Valuing Outcomes

• Perspectives– Patient– Society

• Health state classification systems– e.g. EQ-5D

ICER

• Net increase in cost / Net gain in effectiveness

• Additional cost per unit increase in effect• Measure of value of resources• Willingness to pay threshold

NLST

• Results (CT compared to no screening)• Per person:

– Additional $1631– Additional 0.0316 life-years– Additional 0.0201 QALYs– ICERs

• $52,000 per life-year gained• $81,000 per QALY gained

– Wide variability

Willingness to Pay Threshold

• $25K per QALY gained?• $50K?• $100K?• $150K?

Two Kinds of Decisions

• Ultrasound• XR• CT• MRI• PET/CT• PET/MRI

• 81 mg aspirin• 325 mg aspirin• 20 mg statin• 81 mg aspirin +

statin• 325 mg aspirin +

statin

Shopping Spree

Competing Choice

Decision Analysis

• Identify and bound decision problem• Create decision tree• Fill in the tree• Calculate expected value• Sensitivity analysis

Decision Analysis

• Identify and bound decision problem• Create decision tree• Fill in the tree• Calculate expected value• Sensitivity analysis

Modeling

Markov Model

Markov Model

• Mutually exclusive, collectively exhaustive health states

• Transition probabilities govern movement among states

• Fixed cycle length• Health states with utility value and/or costs

Decision Analysis

• Identify and bound decision problem• Create decision tree• Fill in the tree• Calculate expected value• Sensitivity analysis

Case

• Data Search– Probabilities

• Percentage of CTs that find liver masses• True cancer rate• True benign finding (cyst)• False negative rate• False positive rate• Etc…

– Data Quality/Missing Data– Expert Opinion

Decision Analysis

• Identify and bound decision problem• Create decision tree• Fill in the tree• Calculate expected value• Sensitivity analysis

Sensitivity Analysis

• How high a false negative rate can you tolerate for this test to be cost-effective?

• How many screening CTs can you perform for this test to be cost-effective?

• What complication rates can you tolerate for ablation to be more cost-effective than nephrectomy for treating RCC?

Sensitivity Analysis

Health Care Rationing?

Health Care Rationing?• (c)(1) The Secretary shall not use evidence or findings from comparative

clinical effectiveness research conducted under section 1181 in determining coverage, reimbursement, or incentive programs under title XVIII in a manner that treats extending the life of an elderly, disabled, or terminally ill individual as of lower value than extending the life of an individual who is younger, nondisabled, or not terminally ill.

• (e) The Patient-Centered Outcomes Research Institute established under section 1181(b)(1) shall not develop or employ a dollars-per-quality adjusted life year (or similar measure that discounts the value of a life because of an individual’s disability) as a threshold to establish what type of health care is cost effective or recommended. The Secretary shall not utilize such an adjusted life year (or such a similar measure) as a threshold to determine coverage, reimbursement, or incentive programs under title XVIII.

http://www.ssa.gov/OP_Home/ssact/title11/1182.htm

Challenges

• Variation and uncertainty• Data lacking• Cost estimates challenging• Lack of methodological uniformity• Politically controversial