Practice Management

Cost Effectiveness

Bridging the gap between economic analysis and value-base care is essential. Howard Larkin reports from the 39th Congress of the ESCRS in Amsterdam

In an era of rising demand for limited resources, cost-effective care is becoming an increasingly important concept for both clinicians and patients. But bridging the gap between how it can be applied to improve clinical practice and how to use it to guide macro- and meso-level health policy decisions is essential to optimise overall resource use and individual patient outcomes says Carmen D Dirksen MD, PhD.

Cost effectiveness is all about value, said Dr Dirksen, noting that there are many different ways to conceive it in healthcare.

Typically, in ophthalmology, the focus is on reducing symptoms and complaints, vision improvement, preventing blindness, minimising side effects, preventing complications, improving patients’ functioning, and increasing patients’ quality of life.

“These are the ‘usual suspects’ in evidence-based practice [that] focus on the clinical and health benefits. But maximising health comes at a price—literally.”

On the one hand, most health systems must deal with ever-increasing costs driven by a variety of factors, including technological and pharmaceutical advancements and an ageing population with multiple morbidities that complicate clinical management.

On the other hand, resources are limited in time, money, and personnel.

“To capture this side of the coin, we need a broader conceptualisation of value than only patient health,” Dr Dirksen said.

VBHC VS EE One such concept currently receiving much attention is valuebased healthcare (VBHC). Introduced by Michael Porter in 2006 and described in a famous paper in the New England Journal of Medicine in 2010, VBHC is designed to increase patient value while creating awareness and minimising cost. Patient value is central and defined as patient-relevant outcomes related to the costs associated with the outcome, Dr Dirksen explained. As such, VBHC can be used to continuously improve healthcare quality and guide individual practice decisions based on general and patient-specific preferences.

By contrast, economic evaluation (EE) is a concept that deals with the relative value of treatments, in which option costs are compared.

“The main question of economics is how to allocate scarce resources in an optimal way,” Dr Dirksen said.

EE includes cost-effectiveness analysis, in which money spent is evaluated against clinical endpoints. However, cost-utility analysis—money evaluated against generic quality-of-life years (QALY) gained or preference-based quality-of-life indicators gained—is generally preferred.

“The universal nature of the QALY makes it possible to compare healthcare technologies over populations, but also over disease areas.”

EE creates a framework for evaluating new versus existing health technologies and informing allocation decisions. Consideration of opportunity costs and displacement effects (the reductions in one activity due to increases in another) is essential.

“Doctors want the best for every individual patient, but in a budget-constrained system, each euro you spend on one patient you cannot spend on another patient, so choose wisely,” Dr Dirksen said.

EE considers the costs and health benefits of multiple interventions against one another to determine the incremental cost of a benefit unit for each intervention, also known as an incremental cost-effectiveness ratio (ICER).

ICERs are evaluated against threshold values that distinguish high-value from low-value care, with treatments having an ICER over the threshold—for example €50,000 per QALY gained, deemed lower value. This kind of EE is often used to inform coverage and reimbursement decisions—for example, covering the cost of manual but not femtosecond laser-assisted cataract surgery.

EE also may guide investment decisions by insurers in health systems and can be used at the department and practice levels for allocating resources. It can guide decisions to adopt specific technologies and treatments, reduce practice variation, and identify the most cost-effective options for sub-groups of patients. However, EE is not effective for guiding treatment decisions on the individual patient level because individual patients vary in what they value in outcomes.

BRIDGING THE GAP “Can we bridge the gap between EE and VBHC? Both address ‘bang for the healthcare buck,’” Dr Dirksen asked. They could be better aligned by using VBHC patient-relevant outcomes, such as core outcomes sets and patient-reported outcomes, as measures of effectiveness for EE cost effectiveness and cost consequence analyses. Integrating patient-centred outcomes into QALYs also has been recently proposed.i

“Although EEs generally guide policy decisions at the macro and meso levels, adopting high-value care and abandoning lowvalue care based on EE will contribute to developing VBHC systems. The results of EE or cost information may also enter clinical practice guidelines and decision-making,” she said.

“I think we should at least try to bridge the gaps. Connecting EE with evidence-based medicine and evidencebased practice and VBHC both at the professional community level and methods level will serve patients, healthcare, and society,” she concluded.

i. Walraven J et al., Value in Health, 2021; 24(7): 1038–1044.

Carmen Dirksen MD, PhD is professor of health technology assessment, Maastricht University, Netherlands, and CEO of the Clinical Trial Centre, Maastricht. c.dirksen@mumc.nl