1. Cost Containment and QALYsQALY 1

2. What’s a “good” buy? “Expensive” more than $100,000/QALY “Reasonable” $50,000/QALY (UK upper limit ~ $47,000) “Very Efficient” less than $25,000/QALY Most writers use $50-100,000 as upper limit of good value, but public preferences suggest upper limit over $200,000 Hirth RA, et al., Medical Decision Making. 2000;20:332-342 2

3. Some sample QALYs (2002 dollars) Harvard Public Health Review (Fall 2004) < $0 (If the cost per QALY is less than zero, the intervention actually saves money) Flu vaccine for the elderly Under $10,000 Beta-blocker drugs post-heart attack in high-risk patients $10,000 to $20,000 Combination antiretroviral therapy for certain HIV patients $15,000 to $20,000 Colonoscopy every five to 10 years for women age 50 and up $20,000 to $50,000 Antihypertensive medications in adults age 35-64 with high blood pressure but no coronary heart disease Lung transplant in UK (Anyanwu AC et al. J Thorac Cardiovasc Surg 2002;123:411-420) $50,000-$100,000 Dialysis for patients with end-stage kidney disease Antibiotic prophylaxis during dental procedures for persons at moderate to high risk of bacterial endocarditis ($88,000) (Med Decis Making. 2005;25(3):308-20) Over $500,000 CT and MRI scans for kids with headache and an intermediate risk of brain tumor 3

4. Condition/Treatment Cost per QALY Treatment for Erectile Dysfunction$6,400/QALY *Physician Counseling for Smoking$7,200/QALY Total Hip Replacement$9,900/QALY *Outreach for Flu and Pneumonia $13,000/QALY Treatment of Major Depression$20,000/QALY Gastric Bypass Surgery$20,000/QALY Treatment for Osteoporosis$38,000/QALY * Screening For Colon Cancer $40,000/QALY Implantable Cardioverter Defibrillator $75,000/QALY Lung-Volume Reduction Surgery$98,000/QALY Tight Control of Diabetes$154,000/QALY *Treating Elevated Cholesterol ( + 1 risk factor)$200,000/QALY Resuscitation After Cardiac Arrest$270,000/QALY Left Ventricular Assist Device$900,000/QALY COST/QALY: Selected Medicare services 4

5. Cost of treatment for metastatic colon cancer (Schrag D. NEJM. 2004;351:317-319 ) 5

6. Examining the cost and cost-effectiveness of adding bevacizumab (Avastin) to chemo in metastatic colon cancer Randomized trial compared chemotherapy alone vs. chemotherapy + bevacizumab Bevacizumab regimen prolonged median survival from 15.6 to 20.3 months (p<0.001) Cost of extra 4.7 months? $101,500 (assuming $5,000 per month for bevacizumab) $259,149 per year of life gained (not quality adjusted) NICE decided not to recommend for NHS coverage 6

7. Randomized trial compared chemotherapy alone vs. chemotherapy + bevacizumab Bevacizumab regimen prolonged median survival from 10.2 to 12.5 months (p=0.007) Cost of extra 2.3 months? $66,270-$80,343 $345,762 per year of life gained (assuming $66,270 cost) Grusenmeyer PA, Gralla RJ. J. Clin. Oncology. 2006;24(18S):6057. Examining the cost and cost-effectiveness of adding bevacizumab (Avastin) to chemo in advanced non-small cell lung cancer 7

8. Can we make QALY-based decisions? Cost-effectiveness decisions are controversial Prohibited under PPACA from being used as sole basis for denying coverage in federal programs (§6301) Oregon Health Care Plan Ended up with fairly generous “basic” coverage Mammography screening guidelines in 2009 (page 149) US Preventive Services Task Force recommended that routine screening begin at age 50 instead of age 40 The “tragic choices” problem It’s difficult to make life-and-death decisions openly 8

9. What is a QALY? What is a QALY? 01 Dead Perfect health Major stroke Recurrent stroke Studying for a law school exam 9