Module 13: Cost-Utility Analysis & Cost-Effectiveness Analysis

is a pharmacoeconomic evaluation that ompares costs and and utility

Cost-Utility Analysis

Most difficult and expensive economic evaluation method to use

Also, uses ___________ outcomes; not ____________

CUA

final, intermediates

Cost-Utility Analysis

Results are typically expressed as:

• Cost per QALY gained

• Cost per healthy year equivalents (HYE)

• Cost per well-years gained, per time without symptoms and toxicity (TWiST)

• Others (functions of years, value-adjusted years, quality-adjusted life expectancy)

Economic evaluation to compare costs (in dollars) of a defined outcome in natural units (e.g. cures, lives saved, or blood pressure) of at least two competing interventions

Cost-Effectiveness Analysis

Most common type of pharmacoeconomic analysis in pharmacy is

Cost-Effectiveness Analysis

How to measure utility?

Rating Scale

Standard Gamble

Time Trade-Off

RS Examples

• Rate your pain on a scale of 0-10

• How satisfied are you with your healthcare?

Standard Gamble (SG)

Classic method of measuring ________________

Respondent is given _______ alternatives:

Also, is the __________

preferences

two

Gold standard

Similarly to SG, respondent is offered two alternatives, but the duration of health state is altered, instead of probability

Time is then altered until respondent is indifferent between the two alternatives

Time Trade-Off (TTO)

• Refers to the duration or length of life an individual experiences

• Often measured in years, can be measured in months, days, hours, etc

Quality-Adjusted Life Years (QALY)

Steps in Calculating QALYs

1 Develop a description of each disease state or condition of interest 2 Choose method for determining utilities (SG, TTO, RS)

Choose subjects who will determine utilities

4 Calculate QALY

QALY equation

QoL x life expectancy

Quality of life

QALY is the product of quantity (____) and quality (___) of life

Y;Q

Is a measure used in cost-utility analysis, comparing the incremental cost of a medical intervention to the incremental utility (or QALYs) gained, providing a ratio of cost per additional unit of health benefit

Incremental Cost Utility Ratio (ICUR)

ICUR =

Δ Costs ÷Δ QALYs

ICUR and ICER can be used interchangeability.

T/F

T

CUA should be used when:

QoL is the important outcome

Programs in questions affects morbidity and mortality

Program being compared have a wide range of difference types/outcomes and a common unit output (QALY) is desired

Represents the additional cost required to gain one additional unit of health outcome when comparing two interventions

Incremental Cost-Effectiveness Ratio (ICER)

ICER =

C1-C0 /E1-E0

Most common type of pharmacoeconomic analysis in pharmacy

CEA

We say an intervention is cost-effective if it is:

1. less expensive and effective

2. More expensive, but benefits is worth the cost

3. Less expensive, less effective when the additional cost are NOT worth it

Quadrant 1

More Effective

More Cost

Quadrant 2

Less Cost

More Effective

IDEAL ONE

Quadrant 3

Less Cost

Less Effective

Quadrant 4

More Cost

Less effective