A comparison of technology coverage decisions

1
A comparison of technology coverage decisions in
the US and the UKseeing the NICE side of
cost-effectiveness analysis

• Stirling Bryan, PhD
• Harkness Fellow in Health Care Policy 2005/6
• Visiting Faculty, Center for Health Policy,
  Stanford
• Professor of Health Economics, Birmingham, UK

2
Overview

• The technology coverage issue
• The UK position and the National Institute for
  Health Clinical Excellence (NICE)
• Some research findings on the use of
  cost-effectiveness analysis (CEA) in coverage
  decisions in the UK
• My understanding of the US position (or my
  misconceptions after 2 days!)
• Some research questions (for my Harkness project)

3
Technology coverage

• What is it?
• a decision not to cover a technology indicates
  that its cost will not be reimbursed as part of
  the insurance package
• it involves setting limits on the health care
  services that can be accessed or provided
• Who makes coverage decisions?
• private health plans and government health
  insurance programs both make coverage decisions

4
Coverage decisions in the UK

• Local level wide variety of primary and
  secondary care decision-making bodies
• National level National Institute for Health
  Clinical Excellence (NICE)
• one of its functions is to appraise new and
  existing health technologies
• coverage decisions based on explicit criteria and
  are informed by an independent assessment of
  evidence, including an economic evaluation
• submissions also received from the sponsor of the
  technology, and other expert bodies

5
Horizon Scanning
Long-list of technologies
National guidance
Prioritisation
NICE Appraisals Committee
Short-list of topics
Patient professional input
Review and economic analysis
Academic HTA team
6
Examples of guidance

• Donepezil, rivastigmine and galantamine are not
  recommended for use in the treatment of mild to
  moderate Alzheimers disease (AD).
• Riluzole is recommended for the treatment of
  individuals with the amyotrophic lateral
  sclerosis (ALS) form of Motor Neurone Disease
  (MND).

7
NICE Appraisal Committee membership (n28)
8
The drug itself has no side effects but the
number of health economists needed to prove its
value may cause dizziness and nausea
9
UK-based research

• Research questions
• To what extent, and in what ways, is
  cost-effectiveness information used in coverage
  decision-making in the UK?
• How might the impact of CEAs be increased,
  particularly in relation to issues of
  accessibility and acceptability?

10
Research methods NICE case study

• Background interviews with members of NICE
  appraisals team
• Focus on 7 technology appraisals
• Documentary analysis
• Observation of committee meetings
• Interviews with selected members of Committee
• Additional, non-technology specific interviews
  with Committee members

11
The AC interview sample (n28)
12
The importance of the economic analysis

• People have come to accept that the economic
  evaluation is more crucial than they thought. I
  think a lot of them came along two years ago with
  the idea that you had to listen to the
  economist say something.
• theyve moved to saying this is all so
  complicated, just tell us what the ICER is!
  because theyve actually realised that it is a
  crucial issue.

13
Appraisal Committee composition
Roles of Committee members
Political
The workings of the Committee
Conceptual challenges
Concepts processes
Information processing
Committee procedures
QALYs
Equity concerns
Practical issues relating to economic analyses
Practical
14
Appraisal Committee composition
Roles of Committee members
Political
The workings of the Committee
Conceptual challenges
Concepts processes
Information processing
Committee procedures
QALYs
Equity concerns
Practical issues relating to economic analyses
Practical
15
Information processing (1)

• Ordinal approach to considering the evidence
  (i.e. effectiveness then CE)
• My first consideration when I look at this is
  does this treatment actually work? obviously
  it has to be clinically effective in order to be
  cost-effective
• I dont believe effectiveness should be a
  criterion for NICE decisions. Now thats a
  fundamental conceptual problem with NICE that
  they require clinical effectiveness before we go
  on to examine cost effectiveness.

16
Information processing (2)
Difference in cost
NE
NW
Difference in effectiveness
SW
SE
17
Committee procedures

• The threshold
• There is a feeling when we get beyond 30,000
  per QALY were running into trouble.
• I do sometimes have reservations about the
  figure of 30,000 per QALY. Where does the
  figure come from? Who determines where the
  cut-off point should be? This magic figure of
  30,000 keeps popping up but I lack the
  underlying knowledge to be able to challenge.
• My biggest criticism is basically we are
  funding things at a level that actually the NHS
  cannot fund that the cost per QALY figure is
  far too high, it should be much lower.

18
Appraisal Committee composition
Roles of Committee members
Political
The workings of the Committee
Conceptual challenges
Concepts processes
Information processing
Committee procedures
QALYs
Equity concerns
Practical issues relating to economic analyses
Practical
19
Conceptual challenge equity

• No strong evidence currently on which to base
  equity weighting
• I think theres a sort of recognition at the
  moment, that we have no basis for doing the
  weighting.
• Some implicit weighting is being done
• At the end of each of these discussions people
  say, well we have no basis for doing this so
  lets just treat a QALY as a QALY regardless.
  But where that isnt true, I think, is in
  relation to children although people dont
  necessarily explicitly state it, I think
  everybody tends to give it more weight.

20
Appraisal Committee composition
Roles of Committee members
Political
The workings of the Committee
Conceptual challenges
Concepts processes
Information processing
Committee procedures
QALYs
Equity concerns
Practical issues relating to economic analyses
Practical
21
Practical issues

• Understanding of the economic evaluation by
  Committee members
• Some are probably not all that clear as to how
  it is done I think there are certainly a number
  who probably dont understand a word of what is
  going on in the health economics bit. and some
  people do keep very quiet when the health
  economics is being talked about and thats very
  noticeable.
• Theres a fuzzy belief that people do understand
  cost-effectiveness, because it is so important we
  all understand it, but the actual principles and
  so on are not well understood.

22
Appraisal Committee composition
Roles of Committee members
Political
The workings of the Committee
Conceptual challenges
Concepts processes
Information processing
Committee procedures
QALYs
Equity concerns
Practical issues relating to economic analyses
Practical
23
The US, coverage and CEA

• Coverage policy is tightly linked to the
  affordability of health insurance, and hence the
  rate of uninsurance and also influences the
  types of medical care Americans receive.
• Absent from these health care reform debates
  is any systematic discussion of processes to
  choose the medical goods and services that health
  insurance should cover.
• Garber (2004, p284)
• We currently lack a consensus on principles
  that would tell us how to distribute health care
  fairly.
• Daniels and Sabin (2002, p3)

24
Medicare coverage

• One of the most difficult policy issues
  confronted in any decision on coverage criteria
  is the role of cost-effectiveness analysis in
  deciding what is to be considered reasonable and
  necessary.
• Tunis (2004, p2197)
• To Medicare, CEA has been an elephant in the
  living room, officially ignored despite its
  obvious importance.
• Neumann (2005, p148)

25
A hopeful future?

• After a decade of failed attempts to integrate
  CEA as a criterion for coverage, prospects for
  its ultimate adoption appear dim.
• These attempts have revealed the strength of
  antagonism in the US towards openly confronting
  resource constraints. If Medicare officials and
  politicians learned anything from the
  experience, it was the political folly of trying
  to ration honestly.
• Neumann (2005, p149)

26
Harkness project

• Central research questions
• What principles and processes underlie coverage
  decisions in the US, what use is made of
  information on the cost-effectiveness of health
  technologies and, if use is limited, why is this
  the case?
• Objectives
• In the main agencies concerned with the finance
  and delivery of health care in the US, to
  describe the principles underlying coverage
  policy and the processes employed
• For selected recent coverage decisions, to
  explore the impact of using a CE criterion
• To elicit the views of stakeholders (including
  the general public) on coverage policy principles
  and processes, and specifically the use of CE
  criterion