Health Economics Literature Research Articles

Fuzzy bi-objective preventive health care network design.

Preventive health care is unlike health care for acute ailments, as people are less alert to their unknown medical problems. In order to motivate public and to attain desired participation levels for preventive programs, the attractiveness of the health care facility is a major concern. Health economics literature indicates that attractiveness of a facility is significantly influenced by proximity of the clients to it. Hence attractiveness is generally modelled as a function of distance. However, abundant empirical evidence suggests that other qualitative factors such as perceived quality, attractions nearby, amenities, etc. also influence attractiveness. Therefore, a realistic measure should incorporate the vagueness in the concept of attractiveness to the model. The public policy makers should also maintain the equity among various neighborhoods, which should be considered as a second objective. Finally, even though the general tendency in the literature is to focus on health benefits, the cost effectiveness is still a factor that should be considered. In this paper, a fuzzy bi-objective model with budget constraints is developed. Later, by modelling the attractiveness by means of fuzzy triangular numbers and treating the budget constraint as a soft constraint, a modified (and more realistic) version of the model is introduced. Two solution methodologies, namely fuzzy goal programming and fuzzy chance constrained optimization are proposed as solutions. Both the original and the modified models are solved within the framework of a case study in Istanbul, Turkey. In the case study, the Microsoft Bing Map is utilized in order to determine more accurate distance measures among the nodes.

Reflections on the development of health economics in low- and middle-income countries.

Health economics is a relatively new discipline, though its antecedents can be traced back to William Petty FRS (1623-1687). In high-income countries, the academic discipline and scientific literature have grown rapidly since the 1960s. In low- and middle-income countries, the growth of health economics has been strongly influenced by trends in health policy, especially among the international and bilateral agencies involved in supporting health sector development. Valuable and influential research has been done in areas such as cost-benefit and cost-effectiveness analysis, financing of healthcare, healthcare provision, and health systems analysis, but there has been insufficient questioning of the relevance of theories and policy recommendations in the rich world literature to the circumstances of poorer countries. Characteristics such as a country's economic structure, strength of political and social institutions, management capacity, and dependence on external agencies, mean that theories and models cannot necessarily be transferred between settings. Recent innovations in the health economics literature on low- and middle-income countries indicate how health economics can be shaped to provide more relevant advice for policy. For this to be taken further, it is critical that such countries develop stronger capacity for health economics within their universities and research institutes, with greater local commitment of funding.

Ethical objections against including life-extension costs in cost-effectiveness analysis: a consistent approach.

One of the major ethical concerns regarding cost-effectiveness analysis in health care has been the inclusion of life-extension costs ("it is cheaper to let people die"). For this reason, many analysts have opted to rule out life-extension costs from the analysis. However, surprisingly little has been written in the health economics literature regarding this ethical concern and the resulting practice. The purpose of this work was to present a framework and potential solution for ethical objections against life-extension costs. This work found three levels of ethical concern: (i) with respect to all life-extension costs (disease-related and -unrelated); (ii) with respect to disease-unrelated costs only; and (iii) regarding disease-unrelated costs plus disease-related costs not influenced by the intervention. Excluding all life-extension costs for ethical reasons would require-for reasons of consistency-a simultaneous exclusion of savings from reducing morbidity. At the other extreme, excluding only disease-unrelated life-extension costs for ethical reasons would require-again for reasons of consistency-the exclusion of health gains due to treatment of unrelated diseases. Therefore, addressing ethical concerns regarding the inclusion of life-extension costs necessitates fundamental changes in the calculation of cost effectiveness.

HOW MUCH FAVORABLE SELECTION IS LEFT IN MEDICARE ADVANTAGE?

The health economics literature contains two models of selection, one with endogenous plan characteristics to attract good risks and one with fixed plan characteristics; neither model contains a regulator. Medicare Advantage, a principal example of selection in the literature, is, however, subject to anti-selection regulations. Because selection causes economic inefficiency and because the historically favorable selection into Medicare Advantage plans increased government cost, the effectiveness of the anti-selection regulations is an important policy question, especially since the Medicare Advantage program has grown to comprise 30 percent of Medicare beneficiaries. Moreover, similar anti-selection regulations are being used in health insurance exchanges for those under 65. Contrary to earlier work, we show that the strengthened anti-selection regulations that Medicare introduced starting in 2004 markedly reduced government overpayment attributable to favorable selection in Medicare Advantage. At least some of the remaining selection is plausibly related to fixed plan characteristics of Traditional Medicare versus Medicare Advantage rather than changed selection strategies by Medicare Advantage plans.

When Is a Model Good Enough? Deriving the Expected Value of Model Improvement via Specifying Internal Model Discrepancies

A “law-driven” or “mechanistic” computer model is a representation of judgments about the functional relationship between one set of quantities (the model inputs) and another set of target quantities (the model outputs). We recognize that we can rarely define with certainty a “true” model for a particular problem. Building an “incorrect” model will result in an uncertain prediction error, which we denote “structural uncertainty.” Structural uncertainty can be quantified within a Bayesian framework via the specification of a series of internal discrepancy terms, each representing at a subfunction level within the model the difference between the subfunction output and the true value of the intermediate parameter implied by the subfunction. By using value of information analysis we can then determine the expected value of learning the discrepancy terms, which we loosely interpret as an upper bound on the “expected value of model improvement.” We illustrate the method using a case study model drawn from the health economics literature.

Intra-Country Health Inequalities and Air Pollution in Developing Countries

In the health economics literature, many studies have assessed the association between environmental degradation and health outcomes. This paper extends this literature by investigating how the presence of air pollution might explain health inequalities both between and within developing countries. We argue that differential exposure to air pollution between asset classes, differential ability to prevent the negative health effects of environment degradation, differential capacity to respond to disease caused by pollutants, and particular susceptibility of some groups to the effects of air pollution are all sufficient reasons for explaining a positive link between air pollution and asset-related health inequality. Using data from developing countries, our econometric results show that sulphur dioxide emissions (SO2) and particulate matter (PM10) partly explain the large disparities in infant and child mortalities between and within developing countries. In addition, we found that the institutions that are based on democratic principles, and which have low levels of corruption and high quality bureaucracy, are the most effective. That is, they are more responsive to the needs of the poor, they promote access to justice and public administration, and they deliver basic services to those most in need. As a result, they are able to more effectively mitigate the mortality effect of pollution for the poorest asset classes compared with that of the richest ones and thus reduce the health inequality it provokes.

Expected value of information in the case of mixed strategies

Cost-effectiveness analysis (CEA) represents the most important tool in the health economics literature to quantify and qualify the reasoning behind the optimal decision process in terms of the allocation of resources to a given health intervention. However, the practical application of CEA in regulatory process is often limited by some critical barriers, and decisions in clinical practice are frequently influenced by factors that do not contribute to an efficient resources allocation, leading to inappropriate drug prescription and utilisation. Moreover, most of the times there is uncertainty about the real cost-effectiveness profile of an innovative intervention, with the consequence that it is usually impossible to obtain an immediate and perfect substitution of an intervention with another having a better cost-effectiveness ratio. We propose a rational approach to CEA within regulatory processes basing our analysis in a Bayesian decision-theoretic framework and proposing an extension of the application of well known tools (such as the expected value of information) to such cases. The regulator can use these tools to identify the economic value of reducing the uncertainty surrounding the cost-effectiveness profile of the several alternatives. This value can be compared to the one that is generated by the actual combination (in terms of market shares) of different options: one that is the most cost-effective and others in the same therapeutic category that, despite producing clinical benefits, are less cost-effective. We use prescription of statins as a case study.

The application of realist synthesis review methods in public health economics

BackgroundTraditional systematic reviewing methods tend to focus on measurement and reporting of programme effectiveness, or cost effectiveness in the case of health economic literature. Findings often show mixed results and do not provide a clear indication of why the invention worked under a certain setting. The realist research question is often summarised as “What works for whom, under what circumstances, how and why?” Programme theories are developed that make assumptions about how interventions work in practice. These programme theories are then tested against empirical evidence to populate a theoretical framework. The empirical evidence will support, contradict, or lead to modification of the programme theories through a highly iterative process. With regards to complex social interventions, realist review methods can provide a rich, detailed understanding of the intervention itself, which can be utilised during planning and implementation stages. The aim of this review is to inform the development of a novel multidisciplinary intervention for rehabilitation after hip fracture in the elderly, as part of a larger feasibility trial. MethodsAn ongoing realist review of multidisciplinary rehabilitation packages after hip fracture in the elderly will be used as a case study to show this method's application. Programme theories of behavioural economics (eg, welfare judgments, expected utility gains, and choice architecture) and theories relating to additional costs (eg, due to setting, delivery team, staff training, and additional resources such as time, equipment, or technology) with implications for cost effectiveness were developed as part of the Fracture in the Elderly Multidisciplinary Rehabilitation (FEMuR) realist review. Medline, Embase, AMED, CINAHL, Cochrane Library, and PEDro were searched for studies including the population (elderly adults with proximal hip fracture), intervention (multidisciplinary rehabilitation), and outcomes of interest (mortality, pain, functional status, quality of life, health utility, health service use, costs, patients' experiences). Identified references were transferred to bibliographic software (Endnote) and duplicates removed. References were included if they involved the population of interest, used any type of rehabilitation programme to support re-enablement after proximal hip fracture, and contained any elements of the developed programme theories. With regards to economic evidence, references were excluded if they were not full economic assessments or cost comparative studies. After independent screening by two reviewers and discussion of discrepancies, the full articles were then categorised independently by two reviewers on the basis of their conceptual richness into three categories: rich, thick, and thin. Any discrepancies were resolved by discussion. Data were then extracted until a particular programme theory reached saturation, whereby the inclusion of further references does not add anything new to the understanding of the theory. Findings11 294 references were screened after de-duplication. 620 were included for categorisation. Of these, 20 economic articles were categorised as thin and six as thick. Thick articles discussed implications of setting and delivery team with regards to costs and cost analyses. Thin articles reported economic analyses; however, no explicit programme theories were apparent. None contained elements of behavioural economic theories. InterpretationThe inclusion of health economic programme theories in the FEMuR realist review provides insight into economic mechanisms and contextual factors of multidisciplinary rehabilitation of hip fracture in the elderly, which has previously not been explored. This finding is of particular importance because previous research recommendations from National Institute for Health and Care Excellence guidance relevant to hip fracture rehabilitation interventions specifically highlight the need for evidence of cost effectiveness. FundingThis project was funded by the National Institute for Health Research Health Technology Assessment (NIHR HTA) Programme (funder reference: 11/33-03) and will be published in full in Health Technology Assessment. The views and opinions expressed herein are those of the authors and do not necessarily reflect those of the HTA programme, NIHR, the NHS, or the Department of Health.

Channeling health economics research initiatives to improve decision-making processes in the EU

Health economics as a specialization area has rapidly grown during the last 4 decades. Researchers have selected the topics according to a variety of issues, such as general scientific interest, background knowledge, and perceived gaps in the field as well as the relevance of the topics to their jurisdictions, among others. On the part of the health authorities (managers and politicians), they have to cope with a variety of real-life types of problems that need to be addressed. In their daily practice, they have at their disposal instruments and information from the health economics literature to better manage their health systems. Nevertheless, some mismatches exist in the activities developed by these two groups. On the one hand, it is believed that health authorities disregard or do not use all the available information generated by researchers in their decision-making processes. This could be due to either the irrelevance of a given research for a specific health decision or because health authorities simply ignore it. On the other hand, researchers, for whatever the reason, do not address some topics that really matter to health managers and that would potentially improve the general efficiency of healthcare systems and increase social welfare. The interest in assessing the value of research activities in support of health systems policies was highlighted by Buxton and Hanney 2 decades ago [1]. The need to cope with the gap between research and health policy has also been previously acknowledged by some authors and institutions such as the WHO [2–4]. However, the number of studies and their scope have been quite limited (addressing particular health areas such as pain [5], focusing on single Member States’ research needs [6], being descriptive of some situations [7], and dealing with specific research venues—such as the economic evaluation of health technologies [8] and the value of information as a technique to establish research topics in economic evaluation [9]). More recently, Hunter and Brown [10] have reviewed research topics within the field of health management, and Debrand and Dourgnon [11] described the relationships between health economics research and health policies debated in a meeting of experts from several countries; they also emphasized the need for ‘‘using research evidence to produce pertinent and efficient tools for health policymaking.’’ In spite of these efforts, there is a lack of systematic analysis (follow-up or periodic reviews) on this topic so that health research can be channeled to the more useful areas of health policy making. Other authors have recently noted the necessity to fill the gap between health research and policy [12]. Interestingly, health economics scientific policy in most of the EU countries usually relies on public calls as the instruments to channel funds to research programs. However, these programs have vaguely defined goals and are commonly framed in rather general terms, either guided by some leading research teams or by politicians and bureaucrats in charge of the general scientific policy. Health authorities are not usually empowered to decide on or select the guiding principles of the general scientific policy (i.e., the goals of the calls for each program). In this environment, it is a common practice for each research group to participate in the calls by proposing its preferred topics, which usually find a niche that makes their proposal eligible to receive financial aid. One frequent evaluation criterion to evaluate the results of a research project ex-post is to look at the quality of the peer-reviewed F. Antonanzas (&) R. Rodriguez-Ibeas Department of Economics, University of La Rioja, 26004 Logrono, Spain e-mail: fernando.antonanzas@unirioja.es

John Nyman and the Economics of Health Care Moral Hazard

In 2003, John Nyman published The Theory of Demand for Health Insurance. His principal contributions are (1) to replace the previously unexamined axiom of risk avoidance with the axiom of welfare maximization; (2) to uncover a misinterpretation in the literature on moral hazard, namely, the insurance payoff as a price reduction, rather than as an income transfer. The immediate consequence of these reformulations is to recognize insurance-induced health care utilization as resulting in an increase in social welfare. Despite its evident validity and enormous implications, Nyman’s work has received very little attention or recognition in the health economics literature.

MORE THAN FIGURES? QUALITATIVE RESEARCH IN HEALTH ECONOMICS

When attending last year’s (2011) International Health Economics Association (iHEA) conference in Toronto, we were struck by the notion that almost all papers we listened to used a very similar quantitativemethodology, whereas qualitative methods barely seemed to play a role. This is unfortunate: (Health) economists could effectively integrate combinations of qualitative and quantitative methods into their research toolkit, without having to give up the formal modeling approach they are accustomed to. The population and institutions studied will rarely be identical with the population for which policy recommendations are derived, so that, to the extent that the two differ, the recommendations may only partially hold. However, acquiring knowledge about the compatibility of populations and institutions is a complex task, one that may require the type of data generated by qualitative research.

An Expert on Every Street Corner? Methods for Eliciting Distributions in Geographically Dispersed Opinion Pools

Recent publications outline developments in eliciting probabilistic opinions from clinical experts with which to inform structural assumptions and parameter estimates in health economic models. We outline approaches taken to date to elicit probabilistic distributions from experts within the health economic literature and outline the appropriate considerations and the resulting process in developing a new elicitation program with the aim of allowing low-cost elicitation of expert opinion from a heterogeneous and geographically dispersed opinion pool while preserving the essential features of good practice elicitation methods.

Stereotactic Radiosurgery and Stereotactic Body Radiation Therapy Cost-Effectiveness Results

Objective: To describe and synthesize the current stereotactic radiosurgery (SRS) and stereotactic body radiation therapy (SBRT) cost-effectiveness research to date across several common SRS and SBRT applications.Methods: This review was limited to comparative economic evaluations of SRS, SBRT, and alternative treatments (e.g., other radiotherapy techniques or surgery). Based on PubMed searches using the terms, “stereotactic,” “SRS,” “stereotactic radiotherapy,” “stereotactic body radiotherapy,” “SBRT,” “stereotactic ablative radiotherapy,” “economic evaluation,” “quality adjusted life year (QALY),” “cost,” “cost-effectiveness,” “cost-utility,” and “cost analysis,” published studies of cost-effectiveness and health economics were obtained. Included were articles in peer-reviewed journals that presented a comparison of costs between treatment alternatives from January 1997 to November 2012. Papers were excluded if they did not present cost calculations, therapeutic cost comparisons, or health economic endpoints.Results: Clinical outcomes and costs of SRS and SBRT were compared to other therapies for treatment of cancer in the brain, spine, lung, prostate, and pancreas. Treatment outcomes for SRS and SBRT are usually superior or comparable, and cost-effective, relative to alternative techniques.Conclusion: Based on the review of current SRS and SBRT clinical and health economic literature, from a patient perspective, SRS and SBRT provide patients a clinically effective treatment option, while from the payer and provider perspective, SRS and SBRT demonstrate cost savings.

Determinants of life expectancy in eastern mediterranean region: a health production function.

Determinants of health or health production function in health economics literature constitute noticeable issues in health promotion. This study aimed at estimating a health production function for East Mediterranean Region (EMR) based on the Grossman theoretical model. This ecological study was performed using the econometric methods. The panel data model was used in order to determine the relationship between life expectancy and socioeconomic factors. The data for 21 EMR countries between 1995 and 2007 were used. Fixed-effect-model was employed to estimate the parameters based on Hausman test. In estimating the health production function, factors such as income per capita (β=0.05, P<0.001), education index (β=0.07, P<0.001), food availability (β=0.01, P<0.001), level of urbanisation (β=0.10, P<0.001), and employment ratio (β=0.11, P<0.001) were specified as determinants of health status, proxied by life expectancy at birth. A notable result was the elasticity of life expectancy with respect to the employment rate and its significance level was different between males (β=0.13, P<0.001) and females (β=0.08, P>0.001). In order to improve the health status in EMR countries, health policymakers should focus on the factors which lie outside the healthcare system. These factors are mainly associated with economic growth and development level. Thus, the economic stabilisation policies with the aim of increasing the productivity, economic growth, and reducing unemployment play significant roles in the health status of the people of the region.

A Role for Research: An Observation on Preventive Services for Women

The Patient Protection and Affordable Care Act of 2010 (ACA) added preventive services for women, recommended by the IOM, to healthcare coverage requirements beginning in August 2011. The current review provides evidence on the economic impact of services that will be covered under the ACA, focusing on IOM-recommended measures that address women's health. This review analyzed the cost-effectiveness literature related to these services using the Tufts Medical Center Cost-Effectiveness Analysis Registry (www.cearegistry.org), which catalogs detailed information on cost-effectiveness studies published in English in the peer-reviewed literature. In order to keep the review relevant to current clinical practice, the analysis was restricted to studies published in 2000-2010. The data search and analysis were performed in 2011. Cost-effectiveness studies have evaluated a limited subset of the preventive measures available for women. Further, few cost-effectiveness studies have evaluated the recommended counseling and screening services for women. Of 16 relevant studies found, eight focused on HIV screening, with results varying substantially depending on the specific groups screened and the screening frequency. The current review underscores the finding that there is a substantial gap in the health economic literature on preventive care, especially with respect to screening and counseling of women in the primary care setting. There is some evidence that better access to preventive services can be maintained at a reasonable cost to the healthcare system, and that certain services may even lower healthcare costs.

PSU9 Budget Impact of Autograft Harvest, Bone Graft Supplements and Orthobiologic Bone Graft Substitute in Foot and Ankle Fusion Procedures

No multicenter studies currently assess the incremental costs of autogenous bone graft harvest (autograft) in foot and ankle procedures. This study applied conservatively estimated incremental costs of autograft (with and without bone graft supplements/enhancers) using an interactive budgetary impact model comparing costs and cost offsets of an orthobiologic bone graft substitute (β-TCP with recombinant human platelet-derived growth factor-BB [rhPDGF-BB]) in foot and ankle fusion procedures. A Canadian hospital-based budget impact model was developed utilizing International Society of Pharmacoeconomics and Outcomes Research (ISPOR) guidelines. Clinical and health economic literature, data from a 434-patient randomized control trial and data from a panel of ten experienced orthopaedic surgeons provided estimates of medical resource utilization and associated hospital costs. Model parameters were confirmed by six individuals representing 15 Canadian hospitals. Autograft carries incremental costs related to operating suite time (37.9 ± 17.0 minutes for an iliac crest donor site and 22.1 ± 21.6 minutes for local donor sites), recovery room time (25.0 ± 12.3 minutes for iliac and 3.5 ± 9.4 minutes for local), and donor site complications. Conservative base case incremental costs were $1,601(CAD) for iliac crest and $755 (CAD) for local sites. Complications at the harvest site contributed an additional base case cost of $414 for iliac crest and $182 for local sites. Use of an orthobiologic bone graft substitute had higher acquisition costs, but yielded per-case and annualized cost savings ($34 and $2,454, respectively, base case) by eliminating incremental costs, graft harvest complications, and patient pain reported for autograft harvest during clinical trial. The gold standard of harvesting autogenous bone graft as an adjunct to foot and ankle fusion surgery is associated with significant health care costs. The use of β-TCP with rhPDGF-BB eliminated variable, incremental hospital costs associated with bone graft harvesting and treating related complications.

Inquiry into the Relationship between Equity Weights and the Value of the QALY

BackgroundA commonly held view of the decision rule in economic evaluations in health care is that the final incremental cost-effectiveness ratio needs to be judged against some threshold, which is equal for all quality-adjusted life-year (QALY) gains. This reflects the assumption that “a QALY is a QALY” no matter who receives it, or the equity notion that all QALY gains are equally valuable, regardless of the context in which they are realized. If such an assumption does not adequately reflect the distributional concerns in society, however, different thresholds could be used for different QALY gains, whose relative values can be seen as “equity weights.” AimOur aim was to explore the relationship between equity or distributional concerns and the social value of QALYs within the health economics literature. In light of the empirical interest in equity-related concerns as well as the nature and height of the incremental cost-effectiveness ratio threshold, this study investigates the “common ground” between the two streams of literature and considers how the empirical literature estimating the incremental cost-effectiveness ratio threshold treats existing distributional considerations.

Imputing Productivity Gains From Clinical Trials

To respond to employer and payer interest in the extent to which productivity gains offset therapy costs by identifying clinical trials that did not include such measures and using their clinical data to impute productivity impact. A PubMed search identified the sample of 25 clinical trials of musculoskeletal pain medications and antidepressants. Next, we applied regression coefficients, quantifying the empirical relationship between clinical measures to each trial's clinical outcomes data. This validated methodology provides estimates of Work Limitations Questionnaire Productivity Loss scores. Based on imputation, musculoskeletal medications and antidepressants achieved median productivity gains of approximately 0.5% and 1.0%, respectively. Accounting for productivity gains based on the Work Limitations Questionnaire could substantially influence cost-effectiveness results reported in the health economics literature.

PRM21 Medline and Embase for Health Economic Literature Reviews

PRM21 Medline and Embase for Health Economic Literature Reviews

Realising Free Health Care for the Poor in Indonesia: The Politics of Illegal Fees

This paper examines why illegal fees persist at public health facilities in Indonesia. It suggests that their persistence reflects the political dominance of a coalition of interests consisting of politico-bureaucratic elements in the state apparatus and major business groups and the implications this has had for government spending on the health sector and programmes aimedat providing free health care to the poor in particular among other determinants of the level of illegal fees. Accordingly, the paper concludes that eliminating illegal fees from Indonesia's public health system requires not simply better funding of public health facilities and better change management, as much of the comparative health economics literature suggests – although these are certainly part of the solution – but also efforts to empower the poor and their allies vis-à-vis this coalition of interests.