Populations Exam 2

• Pharmacoeconomics


  Description and analysis of the costs of drug therapy to healthcare systems and society
• Pharmacoeconomics identifies, measures, and compares the costs and consequences of pharmaceutical products and services
• $3.5 trillion spent on healthcare in 2017, for an average of $10,000 per person, or ~17% to 18% of the gross domestic product (GDP)
• Expenditures expected to continue rising each year (esp. gene therapy and biologics)
• Pharmacoeconomics at individual patient level

  Determining best medication for each patient depending on demographic, clinical and economic considerations
• Pharmacoeconomics at institutional level

  Implementing a clinical pharmacy service or hiring a clinical pharmacist
• Pharmacoeconomics at hospital system, managed care organization or governmental level

  Developing drug use guidelines and formulary system
• Pharmacoeconomics overlaps with both healthcare economics and pharmacy-related clinical or humanistic outcomes research
• Types of Pharmacoeconomic Studies

  • Cost-minimization analysis (CMA)
  • Cost-effectiveness analysis (CEA)
  • Cost-benefit analysis (CBA)
  • Cost-utility analysis (CUA)

  
• Cost-Minimization Analysis (CMA)


  Simplest to conduct because outcomes are assumed to be equivalent → only the costs of the intervention are compared
• CMA cannot be used when outcomes of interventions are different
• Appropriate uses of CMA

  • Comparing two generic medications that are rated as equivalent by the FDA
  • Comparing different routes of administration of the same drug
  • Comparing the same drug given in different settings
• It would not be appropriate to compare different classes of medications using cost-minimization analyses if there are noted differences in outcomes

  
• Cost-Effectiveness Analysis (CEA)


  Measures outcomes in natural units (e.g., mm Hg, cholesterol levels, symptom-free days, years of life saved)
• Advantage of CEA: Outcomes are easier to quantify when compared with a CUA or a CBA, and clinicians are familiar with measuring these types of health outcomes because they are routinely collected in clinical trials and in clinical practice
• Disadvantage of CEA: Programs with different types of outcomes cannot be compared
• CEA may estimate the extra costs associated with each additional unit of outcome (cure, year of life), but no monetary amount is placed on the clinical outcomes to indicate the value of these outcomes

  
• Cost-Benefit Analysis (CBA)


  Both costs and benefits are valued in monetary terms
• Advantages of CBA


  • Clinicians can determine whether the benefits of a program or intervention exceed the costs of implementation
  • Clinicians can compare multiple programs or interventions with similar or unrelated outcomes
• Disadvantage of CBA: Difficult to place a monetary value on health outcomes
• Examples of CBA


  • Evaluation of vaccinations programs
  • Health screening programs
  • Comparing drugs and/or nondrug treatment options (e.g., diet, exercise, surgery) for a condition
  • Drug-dependence treatment services
  • Diagnostic tests
  • Educational/counseling efforts
• Cost-Utility Analysis (CUA)


  Compares two or more alternatives based on their costs and outcomes, where outcomes are measured in units of quality-adjusted life years (QALYs) or disability-adjusted life-years (DALYs)
• Outcomes in CUA are based on years of life that are adjusted by "utility" weights, which range from 1.0 for "perfect health" to 0.0 for "dead"
• When morbidity and mortality are both important outcomes of a treatment, CUA should be used to incorporate both into one unit of measure
• Disadvantage of CUA: No consensus on how to measure these utility weights, and they are more of a "rough estimate" than a precise measure
• Some researchers consider CUA as a subset of CEA
• Cost-consequence analysis (CCA)


  Only a list of costs and a list of various outcomes are presented, with no direct calculations or comparisons
• Cost-of-illness (COI) analysis


  Researchers attempt to determine the total economic burden (including prevention, treatment, losses caused by morbidity and mortality, etc…) of a particular disease on society
• The costs included in COI studies are usually summarized into two categories: (1) direct costs and (2) indirect costs
• COI studies are used to indicate the magnitude of resources needed for a specific disease or condition, and they may be used to compare the economic impact of one disease versus another or the economic impact of a disease on one country compared with another
• Opportunity cost


  The value of the best-forgone option or the "next best option" - not necessarily the amount of money that changes hands
• Resources committed to one product or service cannot be used for other products or services (opportunities)
• Price


  The amount that is charged to a payer and is not necessarily synonymous with the cost of the product or service
• Cost Categorization


  • Direct medical costs
  • Direct non-medical costs
  • Indirect costs
  • Intangible costs

  
• Direct medical costs


  The medically related inputs used directly to provide treatment
• Examples of direct medical costs for chemotherapy treatment


  • Chemotherapy products
  • Medications to reduce side effects
  • Intravenous supplies
  • Laboratory tests
  • Clinic costs
  • Physician visits
• Direct non-medical costs


  Costs to patients and their families that are directly associated with treatment but are not medical in nature
• Examples of direct non-medical costs for chemotherapy treatment


  • Travel costs to and from the clinic or hospital
  • Childcare services
  • Food and lodging for patients and families
• Indirect costs


  Costs that result from the loss of productivity because of illness or death
• Examples of indirect costs for chemotherapy treatment


  • Time off work for the patient to receive treatment
  • Reduced productivity due to the effects of the disease or its treatment