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180 Cards in this Set
- Front
- Back
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define pharmacoeconomics
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describes costs(input) and consequences(outcomes) of drugs/pharmacy services
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pharmacoeconomics shares parts of what 2 other fields
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health care economics
pharmacy-related clinical or humanistic outcomes research |
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pharmacy related clinical or humanistic outcomes can be broken into 2 fields, what are they?
describe each |
basic research-drug discovery and development
outcomes research- pt's taking meds -deals with ECHo models |
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why is pharmacoecon. important
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rising costs
longer life expectancy required by foreign regulators impact of S.E. on economy formulary decisions |
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what settings can pharmacoecon be used?
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formulary
clinical guidelines individual pt tx |
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what are 4 types pharmacoecon. evaluations
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CMA-cost minimiz. analysis
CEA-cost effect analysis CBA-cost benefit anal CUA-cost utility |
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what is another type of pharmacoecon evaluation-thats diff than previous 4
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COI- cost of illness study
-looks at disease** -economic burden for particular disease |
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basics of pharmacoecon. equation
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cost-->intervention-->outcomes
resources --drug/service-consequences consumed |
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pharmacoeconomics studies=
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evaluates both costs and outcomes together
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3 basic important rules in pharmacoecon.
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1-ID best comparator
2-incorp(calc) costs (inputs) 3-calc outcomes(outputs) |
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define costs
opportunity costs |
estimate resources used in prod of good/service
opp costs-resources used per good thats no longer avail. for another |
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rank in terms of monetary value
low to high -insurance reimburstment -charges costs |
cost< insurance reimburstment<charges(sticker price)
always use COSTS for analysis |
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what are the 5 costings steps
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1)ID items to be included
2)Counting units of resource used 3) value resources 4) standardize cost/discount 5)sensitivity analysis |
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which items are included in IDing step
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cost categories
cost perspectives |
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cost categories- traditional classification
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direct costs
-medical -nonmedical Indirect costs Intangible costs |
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examples of direct medical costs
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anything directly to medical tx
-meds, diagnositcs, ambulance |
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examples of direct nonmedical costs
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travel costs(taxi)
hotel stay, child care, meals on wheels |
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examples of indirect costs
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affecting productivity
-pt loses product., or caregiver |
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examples of intangible costs
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feelings, booowhooooo
anxiety, fatigue |
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what are the 5 cost perspectives
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patient-partial direct med, all other costs
provider-partial direct med costs payer-partial direct med costs employer-partial direct med, indirect costs societal-ALL costs! |
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which perspectives are easiest to obtain?
which perspective is the gold standard |
provider and payer-easiest
gold stand-societal perspective |
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describe retrospective resources
examples |
ex-medical records, claims data
less expensive more chance for errors time consuming costs vs charges |
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describe prospective resources
examples |
random. clinical trials, pragmatic trials, pt surveys, expert opinions
VERY EXP! |
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examples of cost valuation sources (step 3)
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med costs-wholesale price (red book)
med services- physican fee ref. personnel- time*wages |
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step 3 (cost valuation)
types |
per-diem
disease per diem disease related group micro-costing |
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cost valuation
per-diem |
least exp
avg cost/day for ANY disease -LEAST ACCURATE |
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cost valuation
disease per diem |
avg cost/day for specific disease
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cost valuation
disease related group(DRG) |
bundled cost for disease tx
most commonly used |
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cost valuation
micro-costing |
MOST PRECISE
detailed info on resources used in study |
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step4 (standardizing and discounting)
define each |
are done to make fair cost comparisons
standardizing- uses consumer price index- when costs are >1 yr ago discounting or projecting- >1 year from now |
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what are most common discount rates
and whats formula |
3%,5%, 6%
1/(1+ r)^t t is for how many years |
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What time is it?
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TOPO TEC AN TIME!
well not yet, BUT SOON!!!! N'WARLEANS, CRAIG!!!! |
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step 5(sensitivity analysis)
define 1 way sens. analysis 2 way |
costs and effectiveness results tested by changing parameters
1 way- vary 1 parameter at time, hold others constant 2way- same thing but 2 parameters |
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multiway sensitivity analysis
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monte carlo
nonparametric bootstraping |
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COI study
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still follow the same costing steps, but this looks at particular disease vs drug therapy/service like in CUA
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what are types of decision analysis modeling
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simple decision trees
recursive decision trees -Markov models |
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define simple decision tree
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alt. + outcomes are explicitly stated to maximize expected value
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what is decision analysis
how is it used |
an analytic method
used in short term outcomes, allows u to systematically compare |
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advantages of decision analysis
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don't need much money
limited time allows for extrapolation |
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what does decision analysis calc?
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total average costs
total average outcomes used in pharmacoecon to calc costs/outcomes for treatments |
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step 1 in decision analysis
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list project objective
decide wether to add drug to formulary or not? |
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step 2 in decision analysis
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specify tx alternatives
new vs old tx |
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step 2 continued
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specify factors
like efficacy/failure side effect profile complications |
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step 3 draw tree structure
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start with decision/choice node=square
chance node=circle terminal node=triangle |
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step 4 in decision analysis
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specify costs/outcomes/probabilities
terminal nodes must be mutually exclusive |
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step 5 in decision analysis
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perform calculations
p's must= 1 plug in numbers from table into decision tree |
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what is a payoff
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its the branch all added up
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what is total weighted cost or expected value
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specific payoff x specific prob,,,
add up all of these for drug |
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step 6 of decision analysis
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interpret results
if only based on price, go with cheapest expected value lowest cost=strategy of choice |
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what outcomes can be calc using decision analysis
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clincial-total weighted life expect.
humanistic-total quality adjusted life yr economic- total avg health care use highest outcome value=strategy of choice |
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when to use markov models
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for long term outcomes
>1 year chronic illness, vaccination program |
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steps in markov models
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1choose health state
2 determine transition 3 choose cycle length and # 4 estimate transition probabilities 5calc costs and outcomes |
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health states (step1) in markov
examples |
stages of health or disease-must be mutually exclusive
well,sick,dead |
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whats the last state in markov model
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absorbing state-state were pt's remain permanently
ex-death state |
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markov model step 2,4
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transition prob
usually from clinical trail data, literature, or expert opinion |
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markov model
step 3 |
cycle length + #
-usually 3 months,1yr #of cycles- necessary for 99.9% of simulation pts to reach absorbing state |
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simulations AKA
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patients
usually 10,000 simulations (pt's) in markov models |
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what are markov models used for
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count avg weighted costs and outcomes for each simulated pt( or cohort of pts) as they go thru model
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disadvantages of markov
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more complex than decision analysis
structure made by researcher-can be biased health states must capture true nature of disease |
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why use sensitivity analysis
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cause uncertainty in values in decision analysis and markov models
so values should ALWAYS be tested |
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define uncertainty
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applies predictions of future events to measurements already made or to unknown
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purpose of sensitivity analysis
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determine rigor of base case results
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sensitivity analysis types
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simple-1 way
a) threshold analysis b)tornado diagrams -2way scenario- best/worst case complex-multi-way |
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1 way sensitivity analysis
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1 value is varied, hold others constant
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threshold analysis
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graphical analysis of 1way sensitivity analysis
point at which A and B will have same expected value |
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tornado diagram
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summarizes multiple 1 way analyzes
plots expected values line that goes thru box is the threshold |
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tornado interpretation
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parameter is sesnitive if it crosses threshold of interest
wider bar(fatties)-more sensitive narrow(skinny)-less sensitive |
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threshold analysis in 2 way sensitivity analysis
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whichever point lies in shaded area-go with that drug
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limitations of simple sensitivity
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hard to show, interpret >3 variables at same time
unrealistic only 1 or 2 are really diff in base case |
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scenario sensitivity analysis
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tests effects of changing several or all parameters
ex-best/worst case scenarios |
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conclusion to sensitivity
if doesn't change--- if base case results change-- |
if base case results DON'T change-decision is insensitive
if it does-base case is sensitive |
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example used
rhythm vs rate |
in base case-rate dominates rthym
but after best case scenario-rthym dominates rate |
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multiway sens. analysis types
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bootstrapping
monte carlo simulation used in decision analysis and markov uncertainty is incorp.-it incorporates random behavior in model |
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multi-way SA usually seen as
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normal distributions
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cost effectiveness acceptablitiy curve gives what
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cost eff % for each QALY
usually $50,000/QALY |
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what is humanistic outcome?
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asses patient's fxn status or QOL
ex-how drug S.E. affect morbidity -illness affectes QOL |
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types of Humanistic outcome units
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QALY-quality adjusted life year **most common
QALM-life months HYE-health year equiv. |
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advantages of humanistic outcomes
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compare diff types of health outcomes/disease with multiple outcomes
doesn't have to give outcome in monetary value |
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example of humanistic outcome
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funding vaccines vs drug rehab vs HTN screening
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limitations of humanistic outcomes
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difficult to determine accurate utility or QALY value
most expensive and hard to analyze-hard to understand what QALY means |
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when to use CUA
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evaluating things that effect QOL
-seasonal allergies, cancer pain when interventions affect both morbidity and mortality |
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when not to use CUA
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HTN
-not all illnesses cause morbidity or S.E. initially anyways |
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step 1 of calculating QALY
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describe disease state- amt of pain, activity restriction, mental changes
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step 2 of calculating QALY
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calc. utilities
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defien utility
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# for strength of PT HEALTH PREFERENCES for outcomes
1=perfect health 0=death |
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3 methods of calculating QALY
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rating scale
standard gamble time trade off |
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describe rating scale
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scale 0 to 100
utility = score/100 so a # from 0 to 1 |
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describe standard gamble
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like branches
..............______p (healthy) alt 1----0<_____1-p (dead) alt2-----0----DISEASE STATE |
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step 3 of QALY
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choose subjects
patients proxies-heatlh care provider(most comm) -society(gen pop) always from pt's point of view |
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step 4 QALY
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CALCULATIONS
utility * #of years of life saved 0.8 * 5 years= 4 QALY |
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QALY
advantages of picking the pt and limitations |
adv-more familiar with effects of the disease vs someone without disease
limits-more biased view give scores closer to 1**** |
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QALY
adv of using health care provider limits |
most commonly used***
adv-understand diseases limits-may not rate discomfort/disability as pt would |
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QALY
adv of using societal limits |
adv -supported by economists
limits-not familiar with complex diseases, so need to edjumacate-time intensive |
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rating scales
adv limits |
adv-questionaires-don't need face time
less cognitively demanding limits-time is not incorp. ppl won't use extreme values _____________________ doesn't include uncertaintiy or time |
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standard gamble
adv limits |
*****GOLD STANDARD*****
ADV-based on econ. theory limits-need face interviews, some dx can't be cured- unreaslistic scenarios ___________________________ includes uncertainty but NO time component |
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Time trade off
adv limits |
adv-more adaptable to dx then S.G.
limits-face interviews required ______________________ includes time and uncertainty |
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RS vs SG vs TTO
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all produce diff scores or utilities
RS< TTO< SG |
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CUA
after getting costs and humanistic outcomes, what to do? |
list interventions with cost in ascending order
eliminate 1st order dominated and 2nd order calc ICURs-incremental cost utility ratios |
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define health-related quality of life, HRQoL
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fxn effect of illness and therapy, from pt's perspective
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what is QoL
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heatlh and nonhealth stuff in ppls lives- econ, political, cultural
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how to measure health?
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surveys, questionaires, instruments
health preferences do NOT = health status |
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how are health preferences measured
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utilities- thru standard gamble, rating scale, TTO
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how is health status measured
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surveys=scores for each domain, not just 1 score
from patients and proxies |
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what are 2 types of HRQoL Surveys
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general-detect unanticipated effex, difficult to interpret
specific-more responsive to changes in health, less likely to detect unanticipated effex |
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examples of general HRQoL Surveys
examples of specific surveys |
SF36
EQ5D specific-PSI(distress index), asthma questionnaires |
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what are domains
and what are the 4 |
dimensions addressed in survey
1-physical fxning 2-mental functions 3-social or role functioning 4-general health perception |
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How many domains?
SF36 EQ5D |
SF36-8 domains
EQ...5...D = 5 domains |
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DOMAIN-physical fxning
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how disease or tx affects activities of daily life- feeding yourself, bathing, dressing,grooming
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DOMAIN-mental fxning
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how disease effex physological distress
-anxiety, moodiness, cognitive fxn |
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DOMAIN-social functioning
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asses how pts role is limited by disease
ability to work/perform in household |
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EQ5D
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self classifier
-1 score, 5domains, 3 levels 1=perfect health 0=deaht <1= worse than death UTILITIES FOR EQ5D CAN BE NEGATIVE****** |
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SF36
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10 diff scores
8 domains higher score=better the HRQOL |
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what combo of generic/ specific measures be used
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do a SF36 or EQ5D and a disease specific instrument
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what is psychometrics
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study of educational and psychological measurement-knowledge, attitudes + personality traits
-mainly deals with study of measurement instruments-questionaires |
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psychometrics focuses on
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reliability and consistency
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3 ways to evaluate surveys
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1 reliability:consistency
2 validity: precision 3 responsiveness: changes over time |
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3 reliability assessments tests
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test-retest reliability-similar scores over time
internal consistency-response agreement within domains interrater reliability-agreement btwn 2 proxies if a survey is RELIABLE, does NOT mean its VALID |
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T OR F
for an instrument to be valid, it MUST be reliable |
TRUE
its pre-requirement to assess validity |
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define responsiveness
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ability of survey to detect changes in health status
-pts on different health stages -same pt in btwn health stages |
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researchers may claim cost effectiveness if
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cost drug 1 < drug 2 AND
better score in at least 1 domain AND not worse in any other domains |
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CBA first applied when
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in social welfare issues in 1800's + 1900's
CBA 1st applied in 1966 medicare and medicaid enactment**** |
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CBA definition in general
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Prest and Turbey defined in 1965
-assess projects in long view(40yrs down road) and wide view(benefit to diff population) |
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CBA def in pharmecon.
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McGhan, Rowland, and Bootman in 78
method to compare all resources consumed(costs) for program vs value of outcome(benefits) -benefits can be negative |
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define externalities
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benefit not only to proposed population
(+)- immunization program-benefit extended to population not just kids (-)- letting sick kids go to school pollution-affects house pricing |
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steps of Cost benefit analysis
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1) determine program type
2)ID alternative 3) ID costs/benefits 4)calc results |
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1st step in CBA
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determine program type
outcomes measure in CBA-monetary units |
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step2 in CBA
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ID alternative
with or without program compare diff programs -asthma program vs diabetes program |
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to be a CBA, you must ..
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include direct and indirect benefits
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direct beneifts
broken up into? define |
direct medical and direct nonmedical benefits
-thru not utilizing costs, cost savings thru reductions in physician visits, length of stay |
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indirect benefits
define how to measure |
increase in productivity or earnings cuz program/intervention
measure-use human capital approach and willingness to pay |
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human capital method
define |
estimate wage and prod. losses cuz of illness, disability, or death
2 basic components-wage rate, missed time cuz illness |
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human capital method
adv disadv |
adv-easy to measure from public sources
disadv- bias against specific groups-assuming kids dont work assumes healthy=100% econ. productive, which is NOT accurate |
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willigness to pay
define |
willing to pay to reduce chances of addverse health outcome
can be used to estimate indirect benefit and intangible benefit |
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Contingent Valuation method
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use to measure WTP
2 elements- 1) hypothetical scenario 2)bidding vechiles-open ended ?'s, payment cards, bidding games |
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WTP
adv disadv |
adv-can measure both indirect benefit and intangible benefit
disadv-starting pt bias in bidding game, validity to responses |
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3 methods to calculating results of CBA
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Net benefit(net cost)
benefit-cost ratio (cost-benefit ratio) internal rate of return |
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Net benefit method
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simplest method
used when project is 1 yr or less used when NB is unlimited |
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benefit cost ratio method
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$ to $ comparison of costs and benefits
from economical perspective |
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if B/C>1 then...
if B/C=1 then if B/C<1 then |
>1 tx is valuable
if =1 still valuable? <1 not benefical evaluates single or multiple programs-cuz all benefits converted into dollars |
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Net present value method
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look up formula
used when project lifetime >1yr estimates future costs or benfits with discounting by discount rate |
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discount rate or r
concept |
given amt of money has diff values when it is spent at diff times
econ-gen use 3,5, or 6% |
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most studies occured in
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hospital setting
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most studies were from what perspective
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provider, NOT societal
200 ppl studied for 16 months |
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most studies were of what quality
proportion of high quality is |
poor (57%)
rising |
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CPS..pharmacy services is
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economically viable
studies need more rigorous design->randomized clinical trials input costs need to be reported |
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PT committee
whos chairman? whos secretary |
chair-physican
secretary-pharmacists |
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whats committees scope
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evaluative
educational advisory--recomm policy |
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fxns of PT committee
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policy develp
form management quality assurance TJC requirements |
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whats steps in process
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PT mins with recc->exect. committee of med staff-> becomes hospital policy
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what is frequency of PT meetings
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not set standard-usually q month or q other month
each institution determines their own freq. |
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rational drug therapy is...
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cost effective
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whats most commonly used analysis
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CEA..quantifiews tradeoffs btwn costs and health effex
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3 types of fomualry categories
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1)full formulary
2)restricted formulary-zyvox 3)non formulary-havnt been evaluated or shortage drugs |
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CEA outcomes are...
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clinical outcomes
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what is cost-effectivness
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relative costs and effects of each alt. have to be considered
-has an outcome worth its respecive cost relative to other alt. |
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what is CEA goal
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to compare relevant costs and clinical outcomes for competing drugs
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adv of using CEA
disadv of CEA |
outcome units commonly used so physicans understand
disadv-diff units so can't compare -diff to colapse multiple outocmes into 1 unit-CUA dose this |
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clinical outcomes or AKA
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effect, clinical effectiveness, efficacy, consequences
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primary clinical outcome units
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morbidity or mortality
-cases cured, # of deaths, remissions |
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intermediate clinical outcomes
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clinical indicators
A1C blood pressure, CD4 count |
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define dominate
define dominated |
dominante-more effective and less costly
dominated-more costly less effective -2 types: 1st order, 2nd order(extended) |
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ICER equation
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cost1-cost2
___________ effect1-effect2 |
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ACER equation
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average cost effectiveness ratio
cost/outcome asks questions of should we tx pt or not- not a question we should be asking |
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IF CUA <50,000 per QALY...
IF CUA >50,000 per QALY |
< 50,000 then cost effectiveness
>50K...not cost effectiveness |
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limits of ICER
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when comparing 2 tx's where change in effect is small, the ICER will be large
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alternative methods of assessing cost effectiveness
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incremental benefit analysis
incremental cost effectiveness plane cost effectivness frontier |
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incremental benefit analysis
formula |
INBA= (Lambda * Delta E)-Delta C
lamda=50,000 INB>0 =cost effective INB<0 not cost effective |
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INBA
adv. limits |
adv-more straight forward
limits-need to know lambda must conduct sensitivity analysis to know at which point decision changes |
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Incremental cost effectiveness plane
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IV..........................I
__________________x axis (-eff to +) III...........................II |
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Quad I
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tradeoff...ICER
Cn>Co En>Eo |
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QuadII
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Dominant
Cn<Co En>Eo |
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QIII
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tradeoff
Cn<Co En<Eo |
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QIV
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dominated
Cn>Co En<Eo |
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cost effectiveness frontier
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line of cost vs effects
slope shows ICER cost effectivnes plane is for straightforward then frontier |
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CMA used when?
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to compare brand vs gen or same drug in deff setting(hosp vs retail)
costs vary as outcome stays same |
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CMA outcome
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equivalent clinical outcome- statical equivalence
ex-comparing meropenem alt dosings |
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CMA
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simplest form of econ. analysis, application is limited
evidence showing equivalence must be stated and statically confirmed |
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define health economics
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studies choices ppl, hc providers, policymakers make in regard to health given scare resources
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what is % of pharmaceutical expenditures in terms of health care costs
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its only 10% of health care costs
but fastest growing segment expected to increase to 50% in 10yrs |
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health cares distinctive features
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asymmetric-Drs. have info
uncertain demand uncertain supply no trade off btwn quantity and quality (only 1 surgery not like cereal) |
