Calculations in Spine Surgery Cost-Effectiveness Research
Calculations in Spine Surgery Cost-Effectiveness Research
Object. Cost-effectiveness research in spine surgery has been a prominent focus over the last decade. However, there has yet to be a standardized method developed for calculation of costs in such studies. This lack of a standardized costing methodology may lead to conflicting conclusions on the cost-effectiveness of an intervention for a specific diagnosis. The primary objective of this study was to systematically review all cost-effectiveness studies published on spine surgery and compare and contrast various costing methodologies used.
Methods. The authors performed a systematic review of the cost-effectiveness literature related to spine surgery. All cost-effectiveness analyses pertaining to spine surgery were identified using the cost-effectiveness analysis registry database of the Tufts Medical Center Institute for Clinical Research and Health Policy, and the MEDLINE database. Each article was reviewed to determine the study subject, methodology, and results. Data were collected from each study, including costs, interventions, cost calculation method, perspective of cost calculation, and definitions of direct and indirect costs if available.
Results. Thirty-seven cost-effectiveness studies on spine surgery were included in the present study. Twenty-seven (73%) of the studies involved the lumbar spine and the remaining 10 (27%) involved the cervical spine. Of the 37 studies, 13 (35%) used Medicare reimbursements, 12 (32%) used a case-costing database, 3 (8%) used cost-to-charge ratios (CCRs), 2 (5%) used a combination of Medicare reimbursements and CCRs, 3 (8%) used the United Kingdom National Health Service reimbursement system, 2 (5%) used a Dutch reimbursement system, 1 (3%) used the United Kingdom Department of Health data, and 1 (3%) used the Tricare Military Reimbursement system. Nineteen (51%) studies completed their cost analysis from the societal perspective, 11 (30%) from the hospital perspective, and 7 (19%) from the payer perspective. Of those studies with a societal perspective, 14 (38%) reported actual indirect costs.
Conclusions. Changes in cost have a direct impact on the value equation for concluding whether an intervention is cost-effective. It is essential to develop a standardized, accurate means of calculating costs. Comparability and transparency are essential, such that studies can be compared properly and policy makers can be appropriately informed when making decisions for our health care system based on the results of these studies.
Costs are an important aspect of clinical, insurance coverage, and payment decisions in health care. Specifically, cost containment has become a prominent issue in US health care policy. In 2012, US health care spending reached $2.8 trillion, or approximately $8915 per patient (including both inpatients and outpatients), an increase of 175% from a decade ago ($1.6 trillion), with projections of increased spending with the introduction of the Affordable Care Act in 2014. With the continued elevation of health care expenditures, medical and surgical interventions are being increasingly scrutinized for their cost-effectiveness to both the patient and provider.
Given equal effectiveness between two procedures for the same medical or surgical indication, patients, providers, and payers will choose the less expensive procedure. It is the transparency of costs that may benefit both the public and private sectors. Cost-effectiveness research seeks to provide such transparency. Table 1 provides some important definitions when interpreting a cost-effectiveness analysis (CEA). Cost-utility analyses (CUAs), a type of cost-effectiveness analysis, produce a numerical ratio known as the incremental cost-effectiveness ratio (ICER) in dollars per quality-adjusted life year (QALY). This ratio is used evaluate the cost-effectiveness between medical and surgical interventions. Defining a cutoff of what is cost-effective is a controversial issue in the literature, as it has been reported from $20,000/QALY gained to $100,000/QALY gained. The cost-effectiveness acceptability curve acknowledges that a single threshold value for cost-effectiveness does not exist and, instead, should be based on an individual's willingness to pay for a particular intervention. This curve illustrates the probability that one intervention is cost-effective compared with another intervention given a maximum acceptable cost-effectiveness ratio (CER) by the decision maker. Due to the uncertainty of what defines true cost-effectiveness, cost-effectiveness acceptability curves are commonly constructed by investigators.
Systematic reviews of cost-effectiveness studies in spine care focus on the cost-utility ratio and measurements of the quality of a particular medical or surgical intervention. A major limitation of existing cost-effectiveness studies is the heterogeneous way in which costs are defined and calculated, as there has yet to be a standardized approach for conducting a cost-effectiveness study. This limitation leads to great difficulty interpreting the results of CUAs and the potential for biased results.
The purpose of this study was to systematically review all cost-effectiveness studies in the spine surgery literature, identify how costs were defined and calculated, and compare different cost methodologies among studies analyzing the same intervention. Understanding these differences will aid future investigators in performing more standardized CUAs.
Abstract and Introduction
Abstract
Object. Cost-effectiveness research in spine surgery has been a prominent focus over the last decade. However, there has yet to be a standardized method developed for calculation of costs in such studies. This lack of a standardized costing methodology may lead to conflicting conclusions on the cost-effectiveness of an intervention for a specific diagnosis. The primary objective of this study was to systematically review all cost-effectiveness studies published on spine surgery and compare and contrast various costing methodologies used.
Methods. The authors performed a systematic review of the cost-effectiveness literature related to spine surgery. All cost-effectiveness analyses pertaining to spine surgery were identified using the cost-effectiveness analysis registry database of the Tufts Medical Center Institute for Clinical Research and Health Policy, and the MEDLINE database. Each article was reviewed to determine the study subject, methodology, and results. Data were collected from each study, including costs, interventions, cost calculation method, perspective of cost calculation, and definitions of direct and indirect costs if available.
Results. Thirty-seven cost-effectiveness studies on spine surgery were included in the present study. Twenty-seven (73%) of the studies involved the lumbar spine and the remaining 10 (27%) involved the cervical spine. Of the 37 studies, 13 (35%) used Medicare reimbursements, 12 (32%) used a case-costing database, 3 (8%) used cost-to-charge ratios (CCRs), 2 (5%) used a combination of Medicare reimbursements and CCRs, 3 (8%) used the United Kingdom National Health Service reimbursement system, 2 (5%) used a Dutch reimbursement system, 1 (3%) used the United Kingdom Department of Health data, and 1 (3%) used the Tricare Military Reimbursement system. Nineteen (51%) studies completed their cost analysis from the societal perspective, 11 (30%) from the hospital perspective, and 7 (19%) from the payer perspective. Of those studies with a societal perspective, 14 (38%) reported actual indirect costs.
Conclusions. Changes in cost have a direct impact on the value equation for concluding whether an intervention is cost-effective. It is essential to develop a standardized, accurate means of calculating costs. Comparability and transparency are essential, such that studies can be compared properly and policy makers can be appropriately informed when making decisions for our health care system based on the results of these studies.
Introduction
Costs are an important aspect of clinical, insurance coverage, and payment decisions in health care. Specifically, cost containment has become a prominent issue in US health care policy. In 2012, US health care spending reached $2.8 trillion, or approximately $8915 per patient (including both inpatients and outpatients), an increase of 175% from a decade ago ($1.6 trillion), with projections of increased spending with the introduction of the Affordable Care Act in 2014. With the continued elevation of health care expenditures, medical and surgical interventions are being increasingly scrutinized for their cost-effectiveness to both the patient and provider.
Given equal effectiveness between two procedures for the same medical or surgical indication, patients, providers, and payers will choose the less expensive procedure. It is the transparency of costs that may benefit both the public and private sectors. Cost-effectiveness research seeks to provide such transparency. Table 1 provides some important definitions when interpreting a cost-effectiveness analysis (CEA). Cost-utility analyses (CUAs), a type of cost-effectiveness analysis, produce a numerical ratio known as the incremental cost-effectiveness ratio (ICER) in dollars per quality-adjusted life year (QALY). This ratio is used evaluate the cost-effectiveness between medical and surgical interventions. Defining a cutoff of what is cost-effective is a controversial issue in the literature, as it has been reported from $20,000/QALY gained to $100,000/QALY gained. The cost-effectiveness acceptability curve acknowledges that a single threshold value for cost-effectiveness does not exist and, instead, should be based on an individual's willingness to pay for a particular intervention. This curve illustrates the probability that one intervention is cost-effective compared with another intervention given a maximum acceptable cost-effectiveness ratio (CER) by the decision maker. Due to the uncertainty of what defines true cost-effectiveness, cost-effectiveness acceptability curves are commonly constructed by investigators.
Systematic reviews of cost-effectiveness studies in spine care focus on the cost-utility ratio and measurements of the quality of a particular medical or surgical intervention. A major limitation of existing cost-effectiveness studies is the heterogeneous way in which costs are defined and calculated, as there has yet to be a standardized approach for conducting a cost-effectiveness study. This limitation leads to great difficulty interpreting the results of CUAs and the potential for biased results.
The purpose of this study was to systematically review all cost-effectiveness studies in the spine surgery literature, identify how costs were defined and calculated, and compare different cost methodologies among studies analyzing the same intervention. Understanding these differences will aid future investigators in performing more standardized CUAs.
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