1. Cost-Effectiveness Analysis 101: What we need to do to demonstrate cost-effectiveness for CTO-PCI
David J. Cohen, M.D., M.Sc.
Director of Cardiovascular Research
Saint Luke’s Mid America Heart Institute
Professor of Medicine, University of Missouri-Kansas City
CRT 2015

2. Disclosures Grant Support/Drugs Grant Support/Devices
Daiichi-Sankyo - Eli Lilly
Astra-Zeneca - Merck
Grant Support/Devices
Edwards Lifesciences - Abbott Vascular
Medtronic - Boston Scientific
Biomet - Covidien
Consulting/Advisory Boards
Medtronic - Astra-Zeneca
Eli Lilly
DJC: 2/15

3. Basic Concepts in Economic Evaluation of Medical Technologies

4. Cost-Effective  Cost-Saving
Principles of Cost-Effectiveness
Cost-Effective  Cost-Saving

5. Cost-Saving  Cost-Effective
Less Effective
More Effective _
???
More $
??? +
Less $

6. Cost-Effectiveness Analysis
Goal
Allocate health investments/expenditures so as to maximize the aggregate health benefits to society, subject to the constraint of a fixed health care budget
General Approach
Costs and net health benefits measured in natural units
Costs-- dollars
Health Benefits-- lives saved, life-years gained, complications prevented
C/E ratio = DCost/DEffectiveness

7. CE ratio: the numerator
Direct costs: costs associated with the labor, equipment, and supplies necessary to provide clinical strategy
Indirect costs (“overhead”): rent, depreciation, maintenance, etc.
Induced costs: downstream costs incurred or avoided due to an up-front clinical strategy
Productivity costs: patient/family time spent on receiving/providing informal care

8. CE ratio: the denominator
LE = Area Between Two Survival Curves
Ideally: quality adjusted

9. Cost-Effectiveness Analysis
Cost-Effectiveness Ratio = DC / DE
Decision Rule (Theoretical)
Calculate C/E ratio for each program to be evaluated
Rank programs in order of increasing C/E ratio
Select programs for funding in order of C/E ratios (lowest to highest), until health care budget is exhausted

10. Measurement of Net Health Benefits
Quality-Adjusted Life Year (QALY)-- metric for combining quality and duration of life into a single measure of health effectiveness
CABG
Good Health
Quality-adjusted life expectancy
= (1.0 x 3 yrs) + (0.7 x 3 yrs)
+ (0.9 x 5 yrs) + (0.3 x 1 yrs)
= 9.9 QALYs
Mild Angina
Stroke
Severe Angina

11. “Low value” Thousands per “Intermediate value” QALY “High value”
Anderson JL et al. JACC doi: /j.jacc

12. Treatments are not cost-effective unless they are effective
Principles of Cost-Effectiveness
Treatments are not cost-effective unless they are effective

13. What is the analytic perspective ?
Key Issues for Understanding the Cost-Effectiveness of CTO-PCI
What is the analytic perspective ?
Implications
Hospital perspective analysis should compare the variable cost of CTO PCI vs. actual reimbursement (“contribution margin”
Societal Perspective need to consider the long term costs, cost offsets, and overall health benefits (survival, QOL) compared with the next best alternative

14. Are there late cost offsets ?
Key Issues for Understanding the Cost-Effectiveness of CTO-PCI
Are there late cost offsets ?
Implications
Although the up-front cost of CTO-PCI is substantial, much of this cost could be recouped if untreated pts require costly medications (e.g., ranolazine) or procedures (e.g., CABG, TMR, EECP, etc)
If this occurs, the true “cost” of CTO-PCI could be much lower than the initial pricetag

15. Is there a true survival benefit ?
Key Issues for Understanding the Cost-Effectiveness of CTO-PCI
Is there a true survival benefit ?
Implications
Since survival differences continue to accrue over patient’s lifetime, even small a small survival benefit can translate into highly cost- effective therapies

18. Is there a QOL benefit compared with best medical therapy?
Key Issues for Understanding the Cost-Effectiveness of CTO-PCI
Is there a QOL benefit compared with best medical therapy?
Implications
If the benefits are substantial an durable, QOL benefits can translate into d QALYs, even without improved survival
Understanding the durability of benefit will be critical to determining the cost- effectiveness of CTO-PCI

19. Impact of Duration of QOL Benefit on Cost-Effectiveness of CTO PCI
Assumptions
Initial cost of CTO-PCI = $15,000
Cost offset = $5000 (similar to CABG in SYNTAX)
Gain in utility = 0.1 (similar to PCI in SYNTAX)
Implications: In order for CTO PCI to be considered “high value”, QOL benefit must last for at least 4 years
Duration of Benefit (years)

20. Economics of CTO-PCI
Summary (1)
Economic considerations are increasingly important in the evaluation of cardiovascular devices and procedures
From the hospital’s perspective, the “value” of CTO PCI is determined by its contribution margin– the balance between variable cost and reimbursement– at least in the current FFS environment
Given increased reimbursement for complex PCI in the current environment, this goal appears to be attainable

21. Economics of CTO-PCI
Summary
From a societal perspective, CTO-PCI has the potential to be a highly cost-effective intervention as well, but only if we can demonstrate meaningful downstream cost offsets, improved survival, or clinically meaningful and durable health status benefits
The critical role of improved QOL in defining the benefit of CTO-PCI emphasizes the importance of proper patient selection to optimize cost-effectiveness