Unbiased Analysis of Today's Healthcare Issues

Applying Cost Effectiveness Analysis to all Health Care Interventions

Written By: Jason Shafrin - Apr• 14•17

That is the topic of a Health Affairs blog post published today by James Baumgarder and Peter Neumann.  An excerpt is below.

Cost-effectiveness analysis (CEA) is an important tool for assessing and pointing the way toward better health care efficiency. The number of published CEAs on health care interventions has blossomed, averaging 34 per year in the 1990 to 1999 time frame and increasing to more than 500 per year in the 2010 to 2014 period. Advances in computing and data storage technology, along with a workforce with the appropriate statistical, health economic, modeling, and computational skills, will enable continued growth in the application of CEA, which can be used for the benefit of providers, payers, patients, and governments. The founding and rapid increase in membership of the International Society for Pharmacoeconomics and Outcomes Research (ISPOR), for example, is a testament to the growth and potential for the use of CEA and other quantitative assessments of the value of various health care technologies.

Researchers have noted, however, that the application of CEA across different types of health care interventions is imbalanced, with CEAs disproportionately conducted on pharmaceuticals. Data from the Tufts Medical Center Cost-Effectiveness Analysis Registry indicate that 46 percent of recent CEAs evaluated pharmaceuticals, yet less than 15 percent of personal health care expenditures in the United States are devoted to prescription drugs. In contrast, only 22 percent of CEAs evaluated surgical or medical procedures.

The rest of the article focuses on the reasons why cost effectiveness analysis occurs more frequently among pharmaceutical interventions compared to medical or surgical interventions and what steps could be taken to better inform key stakeholders of the value of these medical and surgical interventions.  Interesting throughout.

Note that the research underlying the article was funded by the Innovation and Value Initiative, where I serve as the Director of Research.

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