Until now, the US had no official policy on cost effectiveness. And we still don't. That is because this was a non-federal panel (although it was convened by a federal agency). However, these guidelines are likely to become the de facto standard.

In Part 1 of the series, the panel noted the problems inherent in the current state of cost effectiveness analyses (CEA). Methods have been difficult to follow. Health effects (e.g. years of life saved) and costs cited have varied widely from paper to paper. Most importantly, the medical community at-large has become suspicious that the methodology can be manipulated to support particular positions.

The panel was charged to provide a framework for CEA that would work to compare treatments within one approach to a problem [i.e. comparing the CE (cost effectiveness) of two drugs], as well as between different approaches (i.e. comparing the CE between treating with a drug versus taking a preventative approach so that the drug was not needed). The four classes of conditions defined were preventive, therapeutic, rehabilitative, and public health. The goal was to make CEA easier to do (by defining a consistent method), and more useful to those trying to make policy with CE data.

CEA is a method to evaluate outcomes and costs of interventions designed to improve health. It is expressed as dollars ($)/health effect, most often as $/ year of life saved. It takes ($ Cost Therapy A - $ Cost Therapy B)/ (Health Effect Therapy A - Health Effect Therapy B). Notice that one cannot talk about cost effectiveness without comparing two therapies; one of those therapies may be to do nothing.

The panel has defined a "reference case," that is, a description of how every analysis should be done. This standardization will allow for cross-referencing and direct comparisons of one therapy versus another and has been long awaited. While one study could never compare all of the alternative uses of health care dollars, a standard way to assess the cost effectiveness of each part of health care will allow the accumulation of knowledge so that all therapies can be accurately compared.

The use of the reference case does not preclude performing additional analyses within the same paper. The panel recognized that, in many instances, there are merits to approaches that differ from that defined in the "reference case."

The reference case serves 3 functions:

1. It allows analysts and users to see if a study was done the "right" way.
   
   
2. It lets users see more clearly how the end result was computed.
   
   
3. It allows the accumulation of data that will eventually allow society to decide how to spend our health care dollars - so we derive the greatest health benefit for a given expenditure.
   
   

The societal point of view is but one choice among many perspectives from which to choose. Within the field of anesthesiology, the perspective of cost studies has often been that of the hospital, as hospital administrators have been driving anesthesia departments to cut costs.

Does the choice of a societal perspective preclude anesthesiologists taking the hospital's viewpoint? No. But in order for the study to be comparable to other studies in the future it should be conducted from the societal perspective, with additional analyses performed that delineate the relative costs/benefits from the hospital's viewpoint.

For instance, the patient that is discharged from the hospital earlier than was previously the norm may incur extra expenses that would appear on society's ledger sheet but not the hospital's. Costs that are specific to society, and that do not affect the hospital include home caregiver time and time away from work. Time away from work is defined not only as patient time, but also work lost by those providing home support.

The underlying rationale for use of the societal perspective is that decisions affecting people and groups with differing interests is most likely to be viewed as "fair" if the perspective includes all views. When the decision is made from a societal perspective, the result is the provision of the greatest good for all.

Valuing Health Effects:

The measure of the health effect has most commonly been life years gained (greater longevity). However, this measure gives little weight to improvements in quality of life, such as that provided by cataract surgery (or the treatment of acute postoperative pain). Therefore, the use of Quality Adjusted Life Years (QALY's) as the health effect is recommended.

This measure includes both longevity attributable to a therapy as well as quality of life issues. There is a continuum of 0 (death) to 1 (perfect health) that modifies how valuable a year of life is. Several commonly used scales are cited in the paper, with a note that they converge on the way particular morbidities (such as stroke) affect the quality of life. The panel clearly understood that health states worse than death exist.

This is important for anesthesia as we attempt to value our own interventions, which are often very acute in nature. For example, there are many who would rather lose 10 days off of their life than be subjected to 24 hours of excruciating pain. This would make the quality adjustment a minus 10.

Assigning value to a particular health state:

The authors assign value using a representative community sample versus a specific patient's preferences. They note that particular patients' preferences tend to overvalue a particular health state or health benefit if it is a personal feature of their lives. Continuing the "greatest good" argument used to justify a societal perspective for the economic analysis, they suggest use of a representative community sample to value disease states.

In some cases, using patient preferences are allowed - e.g. when deciding if one drug with side effect A is preferable to another equally effective drug with side effect B. A patient may be more comfortable with side effect B rather than A, and while this may differ from a community appraisal, the community has no stake in that choice. So, the community/societal perspective is consistently employed except where common sense dictates otherwise.

In the rare case where community preferences discriminate against the disabled, a sensitivity analysis was recommended to determine the magnitude of that discrimination. For example, for a life saving therapy directed only at paraplegics, society (which places a fairly low value on this health state) would not greatly value extending life in that state.

Patients with this disability have a higher value for their own state, so prolonging their life is more valuable to that disabled person. This difference must be explicitly noted.

The panel was quite clear that individual decisions for particular patients do not need to be performed based solely on society's view. However, these broad views are necessary for policy decisions regarding allocation of resources.

CEA could produce a list from most to least effective therapies and one could simply fund therapies starting at the top of the list until funds were exhausted. This is similar to what the State of Oregon attempted in administering their Medicaid program, and for which they were roundly criticized.

There are values outside of the pure health effect - e.g. fair access to care, helping those who need help the most, and the right to privacy (e.g. when mandatory testing for a disease is considered). Therefore, CEA is proposed as an aid to guide allocation of resources, not as the only arbiter of that decision.

Read Part 2 of this series.
Read Part 3 of this series.