Fig. 10.1 Decision analysis tree comparing Drug A and Drug B for the treatment of AMD (age-related macular degeneration). The tree is read from left to right. The preferred strategy is the use of Drug B because it has a final utility (0.926) greater than the final utility of Drug A (0.924). The □ indicates a decision node, the o indicates a chance node and the Dindicates a terminal node. The incidence of each health state is shown beneath its respective

Pearl

Decision analysis quantifies the most probable outcome associated with an intervention. It integrates all benefits and adverse events conferred by an intervention to ascertain the most probable quality-of-life outcome associated with use of that intervention.

Comparative Effectiveness (Human Value Gain)

Human value gain, the most sophisticated measure of comparative effectiveness, is objectively

branch furthest to the right. The utility associated with no adverse events (0.950) is shown at the right of each respective terminal node, while the utility associated with mild headache is 0.900, that associated with heartburn is 0.850, that for cough is 0.97 and that for muscle pain is 0.880 (P probability). The // through the line going from the decision node to the chance node for Drug A indicates this drug is not the preferred intervention

assessed in quality-adjusted life-years (QALYs), an entity first described by Klarman et al. [47] in 1968. The (improvement in utility) × (years of duration of treatment benefit) quantifies the total human value gain conferred by an intervention [5–7, 13]. As used in Value-Based Medicine® [13, 23], a standardized variant of cost-utility analysis, (human) value gain does not refer to money, but rather signifies the quantifiable improvement in quality of life and/or length of life conferred by an intervention.

Thus, an interventional utility gain of (0.87 − 0.52 =) 0.35 for 10 years results in a QALY gain of (0.35 × 10 years =) 3.5 QALYs. For most ophthalmologic interventions, value gain equates to

the improvement in the quality of life, rather than a gain in length of life.

If the improvement in vision also results in a change in life expectancy from 10–12 years, the total QALY gain is [(0.87 − 0.52) × 10 years] + (0.87 × 2 years), or 3.5 QALYs + 1.74 QALYs, a total gain of 5.24 QALYs.

Value gain can also be measured in percent gain in value. As people go through life, they accrue QALYs. People should theoretically try to maximize their value gain (QALYs accrued) during their lifetimes. If an intervention adds 10 QALYs to the life of a patient who would otherwise accrue 20 QALYs during their remaining lifetime, the value gain is (10/20 =) 50%.

Pearl

The quality-adjusted life-year quantifies the comparative effectiveness or human value gain conferred by any intervention. It is calculated by multiplying (utility gain) × (years of benefit). If length of life is also gained, the (years of gain) × (the person’s utility) is also added.

Pearl

The percent gain in human value, similar to the QALY, is a measure of comparative effectiveness that can be utilized to compare interventions across all specialties, no matter how disparate.

Value Trumps Cost

All patients should want and deserve the intervention, which confers the greatest human value [23]. Only when the human value conferred by interventions is the same should cost be a consideration. In the event of equal value gain, the intervention which is least expensive becomes the preferred interventional strategy. At the current time, the VEGF inhibitor ranibizumab

Table 10.4 Human value gain conferred by healthcare interventions

AREDS age-related eye disease study, AMD age-related macular degeneration, SSRI selective serotonin reuptake inhibitor

aData from Center for Value-Based Medicine Pharmaceutical Value Index® internal files

appears to deliver the greatest value among interventions for neovascular AMD (Table 10.4) [2, 3, 5, 7].

Pearl

A Value-Based Medicine® pillar is the paradigm that all patients deserve the intervention, which confers the greatest (human) value. Only when interventional value is the same does cost become a factor; in this instance the intervention which is the least costly is the preferred strategy.

An example of the comparative effectiveness potential the QALY allows in cost-utility, pharmacoeconomic analyses is demonstrated by the head-to-head comparison of intravitreal pegaptanib and photodynamic therapy with verteporfin

(PDT) for the treatment of classic, neovascular, subfoveal AMD. The final two-year vision in the pegaptanib VEGF IS trial [50] was 20/126−1 in the treatment cohort versus 20/200+1 in the control group, while in the PDT TAP trial [51] the two-year vision was 20/160+1 in the treatment cohort versus 20/320+1 in the control group. Comparing these vision outcomes, much less the accompanying adverse events and the incidences of these adverse events, is virtually impossible without using QALYs. Value-Based Medicine® comparative effectiveness analysis clearly demonstrates PDT to confer the greatest value gain, an 8.1% improvement in the quality of life, compared to a 5.9% improvement in the quality of life conferred by pegaptanib (Table 10.4) [3].

Costs

The costs used in cost-utility analysis are major determinants of the cost-utility ratio [23, 52]. There are three major cost categories: (1) direct medical costs, which include physician and other provider costs, facility costs (acute hospital, ambulatory sur-

gical center, subacute nursing facility, nursing home), pharmaceutical costs, and durable goods;

(2) direct nonmedical costs, such as caregiver costs, transportation costs, costs of shelter, and babysitting costs; and (3) indirect costs, including employment costs, and costs related to volunteering.

Cost Basis

The average Medicare Fee Schedule is the most standardized reimbursement schedule in the United States [53]. Virtually all healthcare insurers in the USA adhere to the Medicare Fee Schedule in some form. Suggested standardized costs in the USA are shown in Table 10.5 [2, 6–8, 17].

Cost Perspective

The third party insurer cost perspective utilizes the direct medical costs, or those relevant for a healthcare insurer. The societal cost perspective, that recommended by NICE (National Institute for Health and Clinical Excellence in the UK) [54] and the Panel for Cost-Effectiveness in Health and Medicine in the USA [24, 33, 34],

utilizes direct medical costs, direct nonmedical costs, and the indirect costs. Other cost perspectives include the governmental cost perspective and the patient cost perspective [52].

The societal cost perspective typically results in a more favorable cost-utility ratio than the third party insurer cost perspective [13]. Costs that result in more favorable cost-effectiveness with the societal cost perspective include those related to increased patient employment, decreased caregiver costs, decreased transportation costs, and the diminution of shelter (nursing home, assisted living, and so forth) costs.

Cost-Utility Ratio

When the total number of QALYs gained from an intervention is amalgamated with the associated costs, the cost-utility ratio, or $/QALY, is the result. The cost-utility of an intervention can be compared with that of any other intervention in healthcare, whether pharmacologic, surgical, or medical.

The cost-utilities of various nonophthalmic healthcare interventions and interventions for atrophic and neovascular ARMD are shown in Table 10.6 [5–8, 16, 55–58]. While laser photocoagulation is more cost-effective in treating neovascular AMD than intravitreal pegaptanib therapy, photodynamic therapy with verteporfin and intravitreal ranibizumab therapy, it confers the least human value among the interventions, and is thus the least desirable among neovascular AMD interventions. This case illustrates the fact that cost-utility (cost-effectiveness) analysis should never be used in a vacuum without knowing the human value gain. In this instance, ranibizumab, while not the most cost-effective, confers the greatest patient value.

Pearl

Cost-utility ratios should never be used in a vacuum. The conferred human value gain for an intervention should also be known, since the most cost-effective intervention may not be the one which confers the greatest patient value (improvement in quality of life and/or length of life).

Table 10.6 Cost-utility of neovascular AMD and other healthcare interventions (in year 2010 real US dollars)

ROP retinopathy of prematurity, SSRI selective serotonin reuptake inhibitor, PPV pars plana vitrectomy, DME diabetic macular edema, ME macular edema, BVO branch retinal vein obstruction, Rx treatment, HIV human immunodeficiency virus, PVR proliferative vitreoretinopathy, C3F8 perfluoropropane, PDT photodynamic therapy, Va visual acuity, CRAO central retinal artery obstruction, AC anterior chamber, CO2 carbon dioxide, O2 oxygen

* = internal data from the Center for Value-Based Medicine®

It is very likely that combination therapies for neovascular AMD will be more commonly undertaken in the near future. In this instance, Value-Based Medicine® cost-utility analysis objectively assesses the value and cost-utility (cost-effectiveness) of these interventions in the same fashion as for monotherapies [13]. The Patient-Centered Outcomes Research Institute will likely play a major role in the