1. Decision Makers’ Attitudes to Cost Effectiveness Analysis Shoshanna Sofaer, Dr.P.H. School of Public Affairs Baruch College

2. June 5, 2007 Academy Health Annual Research Meeting2 The Research Team  Marthe R. Gold, M.D., M.P.H., Principal Investigator, Sophie Davis Medical College, City College of New York  Stirling Bryan, Ph.D., University of Birmingham, UK  Shoshanna Sofaer, Dr.P.H., School of Public Affairs, Baruch College  Taryn Siegelberg, M.P.P., Sophie Davis Medical College, City College of New York

3. June 5, 2007 Academy Health Annual Research Meeting3 Overview  Study Background and Purpose  Methods  Findings Quantitative Quantitative Qualitative Qualitative  Implications

4. June 5, 2007 Academy Health Annual Research Meeting4 Background  Cost effectiveness analysis (CEA) is rarely used to make coverage decisions in the US, although it is increasingly used in other developed nations. Why?  This study explored the attitudes of decision makers in the public and private sectors, in California, to CEA, to identify both support for this approach and barriers to its use.

5. June 5, 2007 Academy Health Annual Research Meeting5 Background  Study funded by the California Health Care Foundation; additional support provided through The Commonwealth Fund through a Harkness Fellowship provided to Stirling Bryan, Ph.D., health economist and participant in the British National Institute for Clinical Excellence (NICE)

6. June 5, 2007 Academy Health Annual Research Meeting6 Methods  Mixed method study  Six half-day workshops with California decision makers, including Health plans/insurers Health plans/insurers Purchasers Purchasers State Medicaid State Medicaid State Health Plan Regulator State Health Plan Regulator Multi-stakeholder coalition Multi-stakeholder coalition

7. June 5, 2007 Academy Health Annual Research Meeting7 Methods  Workshop included: Primer on CEA Primer on CEA Discussion of cases that reveal ethical issues inherent in CEA Discussion of cases that reveal ethical issues inherent in CEA Presentation of information on the CE ratios of 14 condition-treatment pairs Presentation of information on the CE ratios of 14 condition-treatment pairs Request for participants to act as “social” decision makers vis a vis the Medicare program Request for participants to act as “social” decision makers vis a vis the Medicare program

8. June 5, 2007 Academy Health Annual Research Meeting8 Methods  Also, Discussion of the work of NICE Discussion of the work of NICE Discussion of benefits and barriers to CEA in participants’ own organizational context Discussion of benefits and barriers to CEA in participants’ own organizational context  Workshops Included a range of senior decision makers (clinical and non-clinical); average n = 10; total n = 58 Included a range of senior decision makers (clinical and non-clinical); average n = 10; total n = 58 Lasted about 2.5 hours Lasted about 2.5 hours Were moderated by Dr. Bryan and either Dr. Gold or Dr. Sofaer or both Were moderated by Dr. Bryan and either Dr. Gold or Dr. Sofaer or both

9. June 5, 2007 Academy Health Annual Research Meeting9 Methods  Prior to workshop, participants got descriptions of the 14 condition-treatment pairs with information about their effectivness vis a vis Medicare population  They rank-ordered the 14: 5 definitely cover; 5 probably cover; 4 definitely not cover  They were also surveyed vis a vis demographics, attitudes and knowledge of CEA

10. June 5, 2007 Academy Health Annual Research Meeting10 Methods  After the workshop Second survey, with some of the same questions plus additional questions about the workshop and about problems with CEA Second survey, with some of the same questions plus additional questions about the workshop and about problems with CEA  Workshop discussions transcribed; discussion of benefits and barriers coded using NVivo  Pre- and post-surveys analyzed descriptively and comparatively  Rankings analyzed in terms of the difference in CEA ratio between treatment that received high and low priority, before and after CEA ratios were available

11. June 5, 2007 Academy Health Annual Research Meeting11 Findings  While 57% said they understood CEA at least reasonably well before the workshop, 91% rated themselves at that level after the workshop  While 51% said they personally supported health care rationing before the workshop, 59% said they supported it afterwards  In post workshop survey: 72% said CEA should be used in all coverage decisions, not just new treatments 72% said CEA should be used in all coverage decisions, not just new treatments 91% said it should be used in Medicare coverage decisions 91% said it should be used in Medicare coverage decisions 75% said it should be used by private health plans 75% said it should be used by private health plans

12. June 5, 2007 Academy Health Annual Research Meeting12 Findings  Prior to the workshop, the median difference in the CEA ratios of treatments participants said they would cover and those they said they would not cover was $37,000  After the workshop, the median difference grew to $247,000 (p,0.001 using non-parametric statistics)  Thus, people were more likely, after receiving CE information, to cover more cost-effective treatments and choose not to cover less cost- effective treatments.

13. June 5, 2007 Academy Health Annual Research Meeting13

14. June 5, 2007 Academy Health Annual Research Meeting14 Findings  So then why don’t we use CEA?  Discussion and post-workshop survey identify key barriers among these organizations  In post-workshop survey, the following were identified as important barriers by at least two- thirds of respondents: Disconnect between long-term perspective of CEA and short-term perspective of most decision makers Disconnect between long-term perspective of CEA and short-term perspective of most decision makers The risk of litigation The risk of litigation Commercial sponsorship of CEA studies of products Commercial sponsorship of CEA studies of products

15. June 5, 2007 Academy Health Annual Research Meeting15 Findings  Other barriers emerging in qualitative analysis of discussion: Americans will find cost unacceptable as a basis for coverage decisions (a special problem for health plans vis a vis market share) Americans will find cost unacceptable as a basis for coverage decisions (a special problem for health plans vis a vis market share) No single private sector entity can “go it alone” – someone, e.g. Medicare, has to take the lead on this major societal issue No single private sector entity can “go it alone” – someone, e.g. Medicare, has to take the lead on this major societal issue

16. June 5, 2007 Academy Health Annual Research Meeting16 Implications  Decision makers may be more open than we think to using CEA  Our other research indicates that the public can also (through similar workshops) learn enough about CEA to understand it, discuss it, recognize its problems and limits, but then respond like the decision makers to CEA information

17. June 5, 2007 Academy Health Annual Research Meeting17 Implications  The term “cost-effectiveness” is widely misused (e.g. for cheap or cost-saving)  It also carries the “baggage” of the term “rationing”  Action is needed to: Increase understanding of CEA among the public and decision makers? Increase understanding of CEA among the public and decision makers? Create an environment in which it is “safe” to use CEA as ONE input to coverage decisions? Create an environment in which it is “safe” to use CEA as ONE input to coverage decisions? Encourage the Medicare program to examine the advantages of CEA as a cost-constraining device that may not have as many deleterious effects on access and quality as other options? Encourage the Medicare program to examine the advantages of CEA as a cost-constraining device that may not have as many deleterious effects on access and quality as other options?