Health economy – applications for balneotherapy Dr. László Hodinka National Insitute of Rheumatology and Physiotherapy

Introduction Health economics is of growing importance as costcontainment policies worldwide force healthcare managers and doctors alike to consider the cost of treatment as well as its clinical efficacy and safety. Those responsible for allocating healthcare resources need to prioritise so that maximum health gain can be obtained from any given budget. Economic evaluation provides a decision-making framework that can be used to assist in these difficult decisions.

What is health economics Health economics is the application of economic principles to the problem of allocation of scarce healthcare resources. The basic assumption in economic evaluation is that there are not, and never will be, enough resources to satisfy all needs completely. Accordingly trade-offs have to be made. By providing methods for assessing the relative costs and benefits or different treatments, health economics enables difficult decisions on resource allocation to be made rationally.

Introduction to health economy balneotherapy applications Validity Efficacy, effectiveness and efficiency Types of analyses Models for balneotherapy

The concept of validity in research Two distinct types are of relevance Internal validity: the degree to which the results of a study are true for the group of subject who participated in the trial. In essence, internal validity deals with the casual relationship between the intervention and the observed effect. External validity: the extent to which the results of the study are generalisable to individuals outside the study. Without internal validity the results of a study cannot be believed, but without external validity the results cannot be generalised beyond the setting of that particular study.

The validity balance of experimental designs Internal validity Controlled design Subject homogeneity Double blind Placebo comparison Forced compliance Fixed procedures External validity Naturalistic design Representativeness Open treatment Usual care Real compliance Flexible procedures The design determines the extent of generalisability

Efficacy, effectiveness and efficiency Traditionally, three issues were addressed in the evaluation of a drug or healthcare procedure: safety, efficacy and effectiveness. Economists have now added a new dimension, the question of efficiency. The three ’E’s’ have very different and distinct meanings: Efficacythe clinical effect of a treatment Effectivenessthe contribution a treatment or procedure makes to a patient’s utility or welfare Efficiencyachievement of maximum possible benefit (health gain) for a given budget

Levels of health care evaluation Efficiacy Single clinical outcome Time dependent Clinical trial setting Effectiveness Global outcome Time cumulative Naturalistic setting EfficiencyCost/effectiveness Time cumulative Naturalistic setting

Direct costs Changes in resource utilisation that are required or attributable to the intervention being studied. Includes both medical and non- medical components. Indirect costs The monetary value of the changes in productivity that a patient experiences as a result of morbidity or mortality. Types of costs

Benefits The benefits of healthcare are more difficult to quantify than costs, since they are frequently intangible (i.e. less pain, greater happiness, improved quality of life etc.). In health economics, benefits are often considered in terms of the savings made by effective treatment of the patient (i.e. savings in doctors’ and nurses’ time, savings in hospitalisation, lower sickness benefits).

Quality of life studies Quality of life assessments are beginning to be included routinely in clinical trials. Disease-specific questionnaires are most often used to determine quality of life. Quality of life can also be assessed with general health profiles, questionnaires which are less sensitive to change than diseaes-specific scales, but which enable the comparison of quality of life of patients suffering from different diseases. Quality of life studies are descriptive, and do not provide an objective health economic evaluation.

EuroQoL weighted health status of arthrosis patients compared to the general population

Cost-effectiveness analysis This analysis is used to compare treatment options with outcomes that differ in size, but are measurable in the same units. Cost- effectiveness studies avoid the problem of assessing a benefit such as improved life expectancy in financial terms bymeasuring it in natural units e.g. years of life gained or patients successfully treated. The option with the lowest cost per natural unit gained is considered the most efficient treatment.

Cost-utility analysis This is a special form of cost-effectiveness analysis which attempts to measure the intangible benefit of improved quality of life. Cost- utility analysis compares the costs of different procedures or treatments with their outcomes measured in ’utility-based’ units – units that relate to a person’s level of well being. The most commonly used unit is the quality adjusted life year or QALY. QALYs are calculated by estimating the total life years gained from a procedure and weighting each year to reflect the quality of life in that year. Obviously, one year of perfect health is clearly more ’valuable’ to a patient than a year of impaired health. The treatment with the lowest cost per QALY is the most efficient option.

I. Economic evaluation methods for comparing different treatment options MethodApplication Costs measured Benefit units Cost-minimasation Options of different costs and identical benefits Direct and/or indirect costs None Cost-benefit Options of different costs and different benefits Direct and/or indirect costs Monetary Cost-effectiveness Options of different costs and different benefits, but similar types of outcome Direct and/or indirect costs Natural (e.g.: years of life gained Cost-utility Options of different costs and different benefits Direct and/or indirect costs Natural, adjusted for „quality of life”

II. MethodAdvantagesDisadvantages Cost-minimasation Simplicity-lowest cost treatment is the most efficient Limited to special situation i.e. where all alternatives leave identical outcomes Cost-benefit Measures „profitability” Widely applicable (e.g. compare health care and education spending) Difficult to express all benefits in monetary units- e.g. average earnings vary by age, sex and social class Difficult to measure Intangible benefits (although ’willingness-to-pay’ techniques being developed) Cost- effectiveness Benefit units not subject to problems of expression in monetary terms Can compare alternatives with similar outcomes Cannot measure ’profitability Cannot measure intangible benefits Cannot trade-off quality against length of life Cost-utility Benefits units not subject to problems of expression in monetary terms Measures intangible benefits Quality vs. length of life trade-offs (e.g. palliative treatment, cancer chemotherapy Cannot measure ’profitability’ Complex to perform League tables can suggest easy decisions which are not really there

Types of economic analysis Two distinct types are distinguished CaCost related to A CbCost related to B EaEffectiveness of A EbEffectiveness of B Marginal analysisIncremental analysis The additional cost of eachThe additional cost for additional unit of output:the total increment in output: Cn + 1 – CnCa – Cb En + 1 – EnEa – Eb

Ten questions to assess the value of a published health economic study Was the question well-defined, and posed in answerable form? Was a comprehensive description of the competing alternatives given? Was three evidence of the alternatives’effectiveness? Were all important and relevant costs and benefits identified for each alternative? Were all costs and benefits measured in appropriate units, prior to valuation? Were costs and benefits valued credibly? Did costs and benefits occur with the same timings? If not, were adjustments made? Was an incremental analysis of costs and benefits performed? Was a sensitivity analysis performed? Were the results thoroughly discussed, including all issues of concern to the users? Drummond 1985, 1992, 2002

Model of a health utility analysis of balneotherapy in osteoarthritis Study:Tótkomlós thermal water cures in 67 patients with knee and hip osteoarthritis, years, open setting 3 weeks cure in therml pools (18 baths), 3 month follow-up, 24 parameters based on WOMAC elements, ROM, drug needs, etc. (Dr. Miklós Csermely, Dr. János Tóth-Abonyi, 2004 ) Mean change in 3 mo:15,7 per cent of baseline Direct costs of a cure:260 USD or 180 € (based on the reimbursement and co-payment tariffs) Hungarian quality of life value for osteoarthritis: 0,394; 1 QUALY = 2,54 OAy (EqoL5D, Bálint et al, EULAR 2000)

Simplified incremental analysis Key assumptions: –change in parameters measured equals a change in QoL value –no change is resulted in the costs of the disease following the cure –1 QALY= 1: 1 OA year x Hungarian OA QoL factor Cost-effectiveness:cost of cure: change of health state (0-3 mo) 260 USD or 180 € : 15,7 per cent Cost-utility:cost of cure: health gain in QALY 260 USD or 180 € : 0,4 OA year (2,94-2,54 ie. postcure – baseline QUALY) Cost of 1 gained QALY:650 USD or 450 €

Comparative health utility values Internationally accepted limit:50000 USD or € Recent OA value:650 USD or 450 € Biological therapy for RA: USD Osteoporosis/bisphosphonate:18150 USD LBP periradicular steroid inj.:12668 USD Antihypertensive drugs:25000 USD Hemodialysis:55000 USD Lumbar stenosis decompression:70000 USD Multiple sclerosis / interferon: USD

Conclusions More detailed local data on costs are needed regarding the long term health care and social expenditures in the main target diseases of balneotherapy (OA, back pain, fibromyalgia, etc.). Valid outcome parameters incl. QoL measures should be used in long term follow-up balneotherapy trials. Detailed presentation of operational costs of hydro- and balneotherapy services (incl. investment and maintenance) is necessary. Health economy argumentation may be essential in convincing of providers.