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Has the time come for cost-effectiveness analysis in US health care?

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  • BRYAN, STIRLING
  • SOFAER, SHOSHANNA
  • SIEGELBERG, TARYN
  • GOLD, MARTHE

Abstract

Cost-effectiveness analysis (CEA) is a powerful analytic tool for assessing the value of health care interventions but it is a method used sparingly in the US. Despite its growing acceptance internationally and its endorsement in the academic literature, most policy analysts have assumed that US decision makers will resist using CEA to inform coverage decisions. This study sought to clarify the extent to which CEA is understood and accepted by US decision makers, including regulators, private and public insurers, and purchasers, and to identify their points of difficulty with its use. We conducted half-day workshops with a sample of six California-based health care organizations that spanned a range of public and private perspectives regarding coverage of health care services. Each workshop included an overview of CEA methods, a priority-setting exercise that asked participants (acting as ‘social decision makers’) to rank condition treatment pairs prior to and following provision of cost-effectiveness information; and a facilitated discussion of obstacles and opportunities for using CEA in their own organizations. Pre and post-questionnaires inquired as to obstacles toward implementing CEA, attitudes toward rationing, and views on the use of CEA in Medicare and in private insurance coverage decision-making. In post-workshop surveys major obstacles identified included: fears of litigation, concerns about the quality and accuracy of studies that were commercially sponsored, and failure of CEAs to address shorter horizon cost implications. Over 90% of participants felt that CEA should be used as an input to Medicare coverage decisions and 75% supported its use in such decisions by private insurance plans. Despite the wide acceptance of CEA, at the conclusion of the workshop, 40% of the sample remained uncomfortable with support of ‘rationing’ per se. We suggest that how cost-effectiveness analysis is framed will have important implications for its acceptability to US decision makers.

Suggested Citation

  • Bryan, Stirling & Sofaer, Shoshanna & Siegelberg, Taryn & Gold, Marthe, 2009. "Has the time come for cost-effectiveness analysis in US health care?," Health Economics, Policy and Law, Cambridge University Press, vol. 4(4), pages 425-443, October.
  • Handle: RePEc:cup:hecopl:v:4:y:2009:i:04:p:425-443_00
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    Cited by:

    1. James Chambers, 2014. "Do Changes in Drug Coverage Policy Point to an Increased Role for Cost-Effectiveness Analysis in the USA?," PharmacoEconomics, Springer, vol. 32(8), pages 729-733, August.
    2. Daisuke Goto & Ya-Chen Tina Shih & Pascal Lecomte & Melvin Olson & Chukwukadibia Udeze & Yujin Park & C. Daniel Mullins, 2017. "Regression-Based Approaches to Patient-Centered Cost-Effectiveness Analysis," PharmacoEconomics, Springer, vol. 35(7), pages 685-695, July.
    3. Erik Nord & Jose Luis Pinto & Jeff Richardson & Paul Menzel & Peter Ubel, 1999. "Incorporating societal concerns for fairness in numerical valuations of health programmes," Health Economics, John Wiley & Sons, Ltd., vol. 8(1), pages 25-39, February.
    4. Gijs Wetering & Willem Woertman & Eddy Adang, 2012. "Time to incorporate time in cost-effectiveness analysis," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 13(3), pages 223-226, June.

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