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UNIVERSITÄTHEIDELBERG

Institute for Innovation & Valuation in Health Care – www.innoval-hc.com

A Global Perspective on Comparative Effectiveness Programs:Discussing Germany and the UK

1 © Michael Schlander 2009

A Global PerspectiveA Global Perspectiveon Comparative Effectiveness Programson Comparative Effectiveness Programs::Discussing Germany and the UKDiscussing Germany and the UK

Lessons from abroad for health care reform in the U.S.Lessons from abroad for health care reform in the U.S.Conference hosted by the International Policy Network and the Galen Institute

Washington, DC, March 09, 2009

Michael SchlanderMichael Schlander

Medizinische Fakultät Mannheim & Hochschule für Wirtschaft Ludwigshafen






“restricting use”

“containing costs”

“issuing guidance to potential users”

“prioritizing for further evaluation”

“alerting users to future possibilities”

A Broad Range of Expectations:What Are Health Technology Assessments for?






New Product Availability

1P. Danzon et al. (2006); OFT (2007)






1. Safety¬ Does it harm?

(controlled conditions)

2. Efficacy¬ Can it work?1

(controlled conditions)

3. Effectiveness¬ Does it work and is it safe?1

(normal practice)

4. Efficiency¬ Do its benefits outweigh its costs?

(often: “Is it cost-effective”?)

1cf. D. Schwartz and J. Lellouch (1967); 2EBM: “evidence-based medicine”

EBM2: How sure

can we be?

Economic Evaluation:The Logic of Cost-Effectiveness






“A comparative analysis of alternative courses of actionin terms of their costs and consequences”

Costs Therapeutic Action Results

CostDirect cost

Indirect cost(Intangible cost)

Avoided CostsDirect cost

Indirect cost(Intangible cost)

Health StatusMortalityMorbidity

Clinical effect

Health Preferences

Quality of life / utility / QALYs

Cost Minimization

Cost Effectiveness

Cost Utility

Social Choice / PreferencesWillingness-

to-pay

Cost Benefit

Economic Evaluation

CMA

CEA

CUA

CBA






Health

Costs

Value

Resources

A

B

Evidence Based Medicine (A) & Economic Evaluation1

(B)

1cf. Victor R. Fuchs: “Health Care and the United States Economic System”, The Milbank Memorial Fund Quarterly, April 1972: 211-237.






ICER: Incremental Cost-Effectiveness Ratio

CA

O

CB

UA

Treatment B

Treatment A

Effect (Utility, Benefit)

Co

st

UB

UB-UA

CB-CA

UB-UA

ICER = CB-CA

The Logic of Cost-Effectiveness:Incremental Analysis






QALY

C

E

CICER

!

The Cost-Effectiveness Decision Rule …

A. Gafni and S. Birch (1993)

“Guidelines for the adoption of new technologies:

a prescription for uncontrolled growth in

expenditures…”

… and An Early Warning:






2833

47 48 51

6372 75

90

111

99

81

17

0

20

40

60

80

100

120

D I CH DK NL GR F IRE FIN CAN USA AUS S

Total Pharmaceutical Spending (real per-capita growth 1990-2001)1

Australia and Canada introduced cost-effectiveness analysis in 1992 and 1994

1Source: OECD Health Data 2003; Australia and Switzerland: 1990-2000; Germany: 1992-2001; from Schlander (2004)






¬ Three (distinct) “Centres of Excellence“:

¬ Centre for Public Health Excellence

¬ Public health guidance on the promotion of good health and the prevention of ill health

¬ Centre for Health Technology Evaluation

¬ Technology appraisals (recommendations on the use of new and existing medicines and treatments within the NHS)

¬ Interventional procedure guidance (evaluates the safety and effi-cacy of such procedures where they are used for diagnosis or treatment)

¬ Centre for Clinical Practice

¬ Clinical guidelines (recommendations, based on the best available evidence, on the appropriate treatment and care of people with specific diseases and conditions)

NICE

National Institute for Health and Clinical Excellence






¬ Three (to four) phases

¬ Scoping

¬ Assessment

¬ Appraisal

¬ Appeal (if lodged by one or more consultees)

¬ Frequently acclaimed features

¬ NICE objective of appraising the evidence in a way that is “objective, unbiased, and methodologically sound”1

¬ An appraisal process that can be described as being“inclusive, consultative, transparent”1

NICE Technology Appraisal Process (‘MTA’)

1C. Longson, ISPOR Annual Meeting, Arlington, VA, May 20, 2001






Pro

bab

ility

of

reje

ctio

n by

NIC

E

Incremental Cost-Effectiveness Ratio (ICER: cost per QALY gained)

‘Probabilistic’ NICE Cost-Effectiveness ‘Benchmarks’1

1N. Devlin and D. Parkin (2004)






“A QALY is a QALY is a QALY

– regardless of

who gains and who loses it.”1

“The principal objectiveobjective of the National Health

Service oughtought to be to to maximize the maximize the

aggregate aggregate improvementimprovement in the health status of the whole community.”2

2Anthony J. Culyer (1997)

1D. Feeney and G.W. Torrance (1989)but there are reasons to suspect that the utility of health states may be influenced by wealth – cf. C. Donaldson et al. (2002)

“The underlying premisepremise of CEA in health problems is

that for any given level of resources available, societysociety (or

the decision-making jurisdiction involved) wisheswishes to maximize the total aggregate

health benefit conferred.”3

3M.C. Weinstein and W.B. Stason (1977)

A Promise and a Premise






¬ Pearson and Rawlins (2005):

“The conditions seem ripe for a NICE The conditions seem ripe for a NICE in the United Statesin the United States …”

¬ Smith (2004):

“The triumph of NICEThe triumph of NICE”:

“NICE is conquering the world … and may prove to be one of Britain’s one of Britain’s greatest cultural exportsgreatest cultural exports along with Shakespeare, Newtonian physics, The Beatles, Harry Potter, and the Teletubbies …”

¬ WHO (2003):

“Published technology appraisals are already being used as international international benchmarksbenchmarks …”

“What Could Be Nicer Than NICE?”1

1A. Williams (2004)






¬ Planned as a state-independent scientific institute

¬ Initiated with the “Statutory Health Insurance Modernization Act” (GMG) in 2003

¬ Established as a private foundation in July 2004

¬ Legal basis: Social Code Book (SGB) V, § 139c

¬ Financed through additional fees (“Systemzuschlag”)¬ for each hospital visit in Germany (SHI) - € 0.40 each (2007)

¬ for each outpatient doctor consultation (SHI) - €1.20€ each (2007)

¬ Employees (2008): 92 ¬ hereof, 62 scientists

¬ Annual Budget (2008 / 2009): 15 m € (2007: 11m€)

IQWiG

Institute for Quality and Efficiency in Health Care






IQWiG

Legal Assignments (SGB V § 139a)

¬ Evaluation of the current level of evidence on diagnostic and therapeutic techniques for selected diseases

¬ Evaluation of the quality and efficiency of services provided under statutory health insurance with regard to characteristics related to sex, age, and living conditions

¬ Evaluation of evidence-based guidelines for prevalent diseases

¬ Recommendations related to Disease Management Programs

¬ Provision of evidence-based information on the quality and efficiency of health care to the general public, patients and physicians

¬ Evaluation of the “benefit” of drugs

¬ Health Care Reform Act (GKV-WSG) as of April 2007:Health economic (“cost benefit”) evaluation of drugs






Assignments

Recommendations

Decision Making

IQWiG

Assignment of Tasks

Federal Ministry of Health

IQWiG

Federal Joint Committee

IQWiG Assignments¬ by Federal Joint Committee (G-BA)1

¬ by Federal Ministry for Health (BMG)¬ IQWiG may be independently active in pertinent

topics related to medical care (“Generalauftrag”)1Application through the Federal Joint Committee possible for (a) patient organizations, (b) organizations of the German health care self-administration system; not possible for (a) companies, (b) private persons, and (c) interest or lobby groups






THE QALY SURPRISETHE NEW YORKER 1925

?






THE QALY SURPRISETHE NEW YORKER 1925

!






¬ An Empirically Falsified Hypothesis

¬ Neither Policy-Makers Nor Patients Are QALY Maximizers

¬ The Consistency Argument

¬ A Thinly Disguised Normative Claim (unsustainable)

¬ Context Matters

¬ Severity of Condition, Life-Saving Interventions (and “Rule of Rescue”?)

¬ Capacity to Benefit of Secondary Importance Only

¬ Mapping of Individual Utility and Societal Value?¬ League Tables from Sildenafil … to Orphan Treatments?

¬ Small Benefits for Many … Outweighing Important Benefits for Few?

¬ ICER Benchmarks, Program Size, and Opportunity Cost

Some Issues with QALYs:

(1) Concerns Concerning QALY Maximization






¬ Normative Issues

¬ Methodological Issues

¬ Spanning critical assumptions and measurement issues

¬ A Common Defense

¬ “High Face Validity” ¬ But: plausibility not a scientifically respectable criterion!

¬ But: dubious criterion validity (failing tests of reflective equilibrium)!

¬ “A Pragmatic, Workable Approach”¬ But: what does it really mean that (sometimes sophisticated)

computations can be performed on the basis of an(y) artificially defined objective formula?

¬ “Good Enough”¬ But: whose criteria; cui bono?

Some Issues with QALYs:

(2) Despite an Impressive Research Agenda






¬ QALY Maximization Not Supported by Economic Theory

¬ A purely technocratic approach (with a narrow perspective) !

¬ No device to control growth of drug spending !

¬ QALY Maximization Hypothesis Empirically Falsified

¬ Absence of virtually any basis for valid thresholds !

¬ France and Germany Resist “NICE-Mania”¬ ‘NICE to Put QALY Under Examination’ [Agence Presse Medicale 27/01/2009]

¬ Rescue attempts: ¬ definition of an “ultra-orphan” category

¬ ‘consistency’ of cancer drug appraisals

¬ NICE “Threshold Technical Workshop” February 02, 2009

¬ Higher value might be placed on “end-of-life QALYs”

Issues with QALY Maximization:

(3) Implications






¬ ‘Cost-Benefit Analysis’ [in line with ‘international standards’?]

¬ providing that previous “Benefit Analysis” was positive¬ heavy reliance on concepts of evidence-based medicine

¬ Cost-Consequence Analysis (?)¬ no reliance on cost-utility analysis using QALYs

¬ ‘Efficiency Frontier’ Concept¬ focus on ’technical efficiency’

¬ Budgetary Impact Analysis¬ notion of ‘affordability’ [and legal requirement to consider R&D outlays?]

¬ Designed to Increase Transparency¬ not to determine maximum reimbursement prices (?)

¬ Feasibility Assessment of Draft Methods Ongoing [Feb. 2009]

IQWiG 2008: “The Luck of Being Late”?

Draft Methods for Economic EvaluationConsultation Documents V 1.0 (Jan. 24, 2008) and V1.1 (Oct. 09, 2008)






Cost

“Benefit” (Effectiveness)

A

B

C

D

‘Efficiency Frontier’ Approach

¬ Are There Alternative Treatments for the Condition in Question?

¬ Which Alternatives Have Been Reimbursed in the Past?

¬ Dominance of New Treatment “Nd”?=> Reimbursement

¬ Extended Dominanceof New Treatment “Ne”?=> Reimbursement

¬ Issue: Were the Decisions Made in the Past Justified?

IQWiG 2008:

Focus on “Technical Efficiency”

E

F

G

Ne

Nd






“It may well bring

about immortalit

y –

but it will take

forever to test

it.”

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