Life-cycle preferences over consumption and health: when is cost-effectiveness analysis equivalent to cost-benefit analysis?

This paper studies life-cycle preferences over consumption and health status. We show that cost-effectiveness analysis is consistent with cost-benefit analysis if the Lifetime utility function is additive over time, multiplicative in the utility of consumption and the utility of health status, and if the utility of consumption is constant over time. We derive the conditions under which the lifetime utility function takes this form, both under expected utility theory and under rank-dependent utility theory, which is currently the most important nonexpected utility theory. If cost-effectiveness analysis is consistent with cost-benefit analysis, it is possible to derive tractable expressions for the willingness to pay for quality-adjusted life-years (QALYs). The willingness to pay for QALYs depends on wealth, remaining life expectancy, health status, and the possibilities for intertemporal substitution of consumption. (C) 1999 Elsevier Science B.V. All rights reserved.

Cost-effectiveness of cholesterol-lowering therapy with pravastatin in patients with previous acute coronary syndromes aged 65 to 74 years compared with younger patients: Results from the LIPID study

Background We compared cost-effectiveness of pravastatin in a placebo-controlled trial in 5500 younger (31-64 years) and 3514 older patients (65-74 years) with previous acute coronary syndromes. Methods Hospitalizations and long-term medication within the 6 years of the trial were estimated in all patients. Drug dosage, nursing home, and ambulatory care costs were estimated from substudies. Incremental costs per life saved of pravastatin relative to placebo were estimated from treatment effects and resource use. Results Over 6 years, pravastatin reduced all-cause mortality by 4.3% in the older patients and by 2.3% in the younger patients. Older patients assigned pravastatin had marginally lower cost of pravastatin and other medication over 6 years (A$4442 vs A$4637), but greater cost offsets (A$2061 vs. A$897) from lower rates of hospitalizations. The incremental cost per life saved with pravastatin was A$55500 in the old and A$167200 in the young. Assuming no treatment effect beyond the study period, the life expectancy to age 82 years of additional survivors was 9.1 years in the older and. 17.3 years in the younger. Estimated additional life-years saved from pravastatin therapy were 0.39 years for older and 0.40 years for younger patients. Incremental costs per life-year saved were A$7581 in the older and A$1.4944 in the younger, if discounted at 5% per annum. Conclusions Pravastatin therapy was more cost-effective among older than younger patients, because of their higher baseline risk and greater cost offsets, despite their shorter life expectancy.

The burden of mental disorders: a comparison of methods between the Australian burden of disease studies and the Global Burden of Disease study

The national and Victorian burden of disease studies in Australia set out to examine critically the methods used in the Global Burden of Disease study to estimate the burden of mental disorders. The main differences include the use of a different set of disability weights allowing estimates in greater detail by level of severity, adjustments for comorbidity between mental disorders, a greater number of menta I disorders measured, and model ling of substance use disorders, anxiety disorders and bipolar disorder as chronic conditions. Uniform age-weighting in the Australian studies produces considerably lower estimates of the burden due to mental disorders in comparison with age-weighted disability-adjusted life years. A lack of follow-up data on people with mental disorders who are identified in cross-sectional surveys poses the greatest challenge in determining the burden of mental disorders more accurately.

The Australian Burden of Disease Study: measuring the loss of health from diseases, injuries and risk factors

This is an overview of the first burden of disease and injury studies carried out in Australia. Methods developed for the World Bank and World Health Organization Global Burden of Disease Study were adapted and applied to Australian population health data. Depression was found to be the top-ranking cause of non-fatal disease burden in Australia, causing 8% of the total years lost due to disability in 1996. Mental disorders overall were responsible for nearly 30% of the non-fatal disease burden. The leading causes of total disease burden (disability-adjusted life years [DALYs]) were ischaemic heart disease and stroke, together causing nearly 18% of the total disease burden. Depression was the fourth leading cause of disease burden, accounting for 3.7% of the total burden. Of the 10 major risk factors to which the disease burden can be attributed, tobacco smoking causes an estimated 10% of the total disease burden in Australia, followed by physical inactivity (7%).

The burden of disease and injury in Australia

An overview of the results of the Australian Burden of Disease (ABD) study is presented. The ABD study was the first to use methodology developed for the Global Burden of Disease study to measure the burden of disease and injury in a developed country. In 1996, mental disorders were the main causes of disability burden, responsible for nearly 30% of total years of life lost to disability (YLD), with depression accounting for 8% of the total YLD. Ischaemic heart disease and stroke were the main contributors to the disease burden disability-adjusted life years (DALYs), together causing nearly 18% of the total disease burden. Risk factors such as smoking, alcohol consumption, physical inactivity, hypertension, high blood cholesterol, obesity and inadequate fruit and vegetable consumption were responsible for much of the overall disease burden in Australia. The lessons learnt from the ABD study are discussed, together with methodological issues that require further attention.

Assessing cost-effectiveness in mental health: family interventions for schizophrenia and related conditions

Objective: Existing evidence suggests that family interventions can be effective in reducing relapse rates in schizophrenia and related conditions. Despite this, such interventions are not routinely delivered in Australian mental health services. The objective of the current study is to investigate the incremental cost-effectiveness ratios (ICERs) of introducing three types of family interventions, namely: behavioural family management (BFM); behavioural intervention for families (BIF); and multiple family groups (MFG) into current mental health services in Australia. Method: The ICER of each of the family interventions is assessed from a health sector perspective, including the government, persons with schizophrenia and their families/carers using a standardized methodology. A two-stage approach is taken to the assessment of benefit. The first stage involves a quantitative analysis based on disability-adjusted life years (DALYs) averted. The second stage involves application of 'second filter' criteria (including equity, strength of evidence, feasibility and acceptability to stakeholders) to results. The robustness of results is tested using multivariate probabilistic sensitivity analysis. Results: The most cost-effective intervention, in order of magnitude, is BIF (A$8000 per DALY averted), followed by MFG (A$21 000 per DALY averted) and lastly BFM (A$28 000 per DALY averted). The inclusion of time costs makes BFM more cost-effective than MFG. Variation of discount rate has no effect on conclusions. Conclusions: All three interventions are considered 'value-for-money' within an Australian context. This conclusion needs to be tempered against the methodological challenge of converting clinical outcomes into a generic economic outcome measure (DALY). Issues surrounding the feasibility of routinely implementing such interventions need to be addressed.

Cost-effectiveness of cognitive behavioural therapy and selective serotonin reuptake inhibitors for major depression in children and adolescents

Objective: To assess from a health sector perspective the incremental cost-effectiveness of cognitive behavioural therapy (CBT) and selective serotonin reuptake inhibitors (SSRIs) for the treatment of major depressive disorder (MDD) in children and adolescents, compared to 'current practice'. Method: The health benefit is measured as a reduction in disability-adjusted life years (DALYs), based on effect size calculations from meta-analysis of randomised controlled trials. An assessment on second stage filter criteria ('equity'; 'strength of evidence', 'feasibility' and 'acceptability to stakeholders') is also undertaken to incorporate additional factors that impact on resource allocation decisions. Costs and benefits are tracked for the duration of a new episode of MDD arising in eligible children (age 6-17 years) in the Australian population in the year 2000. Simulation-modelling techniques are used to present a 95% uncertainty interval (UI) around the cost-effectiveness ratios. Results: Compared to current practice, CBT by public psychologists is the most cost-effective intervention for MDD in children and adolescents at A$9000 per DALY saved (95% UI A$3900 to A$24 000). SSRIs and CBT by other providers are less cost-effective but likely to be less than A$50 000 per DALY saved (> 80% chance). CBT is more effective than SSRIs in children and adolescents, resulting in a greater total health benefit (DALYs saved) than could be achieved with SSRIs. Issues that require attention for the CBT intervention include equity concerns, ensuring an adequate workforce, funding arrangements and acceptability to various stakeholders. Conclusions: Cognitive behavioural therapy provided by a public psychologist is the most effective and cost-effective option for the first-line treatment of MDD in children and adolescents. However, this option is not currently accessible by all patients and will require change in policy to allow more widespread uptake. It will also require 'start-up' costs and attention to ensuring an adequate workforce.

Cost-effectiveness of psychological and pharmacological interventions for generalized anxiety disorder and panic disorder

Objective: To assess from a health sector perspective the incremental cost-effectiveness of interventions for generalized anxiety disorder (cognitive behavioural therapy [CBT] and serotonin and noradrenaline reuptake inhibitors [SNRIs]) and panic disorder (CBT, selective serotonin reuptake inhibitors [SSRIs] and tricyclic antidepressants [TCAs]). Method: The health benefit is measured as a reduction in disability-adjusted life years (DALYs), based on effect size calculations from meta-analyses of randomised controlled trials. An assessment on second stage filters ('equity', 'strength of evidence', 'feasibility' and 'acceptability to stakeholders') is also undertaken to incorporate additional factors that impact on resource allocation decisions. Costs and benefits are calculated for a period of one year for the eligible population (prevalent cases of generalized anxiety disorder/panic disorder identified in the National Survey of Mental Health and Wellbeing, extrapolated to the Australian population in the year 2000 for those aged 18 years and older). Simulation modelling techniques are used to present 95% uncertainty intervals (UI) around the incremental cost-effectiveness ratios (ICERs). Results: Compared to current practice, CBT by a psychologist on a public salary is the most cost-effective intervention for both generalized anxiety disorder (A$6900/DALY saved; 95% UI A$4000 to A$12 000) and panic disorder (A$6800/DALY saved; 95% UI A$2900 to A$15 000). Cognitive behavioural therapy results in a greater total health benefit than the drug interventions for both anxiety disorders, although equity and feasibility concerns for CBT interventions are also greater. Conclusions: Cognitive behavioural therapy is the most effective and cost-effective intervention for generalized anxiety disorder and panic disorder. However, its implementation would require policy change to enable more widespread access to a sufficient number of trained therapists for the treatment of anxiety disorders.

Illicit Opiate Abuse

Illicit opiate use, especially injected drugs, contributes to premature mortality and morbidity in many developed and developing societies. The economic costs of illicit drug use are substantial. Fatal overdoses and HIV/AIDS resulting from sharing dirty needles and injecting equipment are major contributors to mortality and morbidity. Illicit opioid use accounted for 0.7 percent of global disability–adjusted life years in 2000. An estimated 15.3 million people, or 0.4 percent of the world population ages 15 to 64, used illicit opioids in 2002, with more than half using heroin and the rest using opium or diverted pharmaceuticals such as buprenorphine, methadone, or morphine. The most popular interventions for illicit opioid dependence in many developed societies have been law enforcement efforts to interdict the drug supply and enforce legal sanctions against drug use. One consequence has been that illicit opioid users have been exposed to the least effective intervention: imprisonment for drug or property offenses. The most effective intervention to reduce blood–borne virus infection resulting from illicit drug injections is provision of clean injecting equipment to users. This intervention has been widely supported in developed countries, but less so in developing countries. In addition, vaccinations are effective against hepatitis B. In treatment settings, the most popular interventions have been detoxification and drug–free treatment, which has proven the least productive in retaining opioid–dependent people in treatment. Opioid agonists have a niche role in treatment of opioid dependence, especially if their efficacy improves with development of long–acting injectable forms of the drug.

Cholesterol-lowering therapy with pravastatin in patients with average cholesterol levels and established ischaemic heart disease: is it cost-effective?

Objective: To measure the cost-effectiveness of cholesterol-lowering therapy with pravastatin in patients with established ischaemic heart disease and average baseline cholesterol levels. Design: Prospective economic evaluation within a double-blind randomised trial (Long-Term Intervention with Pravastatin in Ischaemic Disease [LIPID]), in which patients with a history of unstable angina or previous myocardial infarction were randomised to receive 40 mg of pravastatin daily or matching placebo. Patients and setting: 9014 patients aged 35-75 years from 85 centres in Australia and New Zealand, recruited from June 1990 to December 1992. Main outcome measures: Cost per death averted, cost per life-year gained, and cost per quality-adjusted life-year gained, calculated from measures of hospitalisations, medication use, outpatient visits, and quality of life. Results: The LIPID trial showed a 22% relative reduction in all-cause mortality (P < 0.001). Over a mean follow-up of 6 years, hospital admissions for coronary heart disease and coronary revascularisation were reduced by about 20%. Over this period, pravastatin cost $A4913 per patient, but reduced total hospitalisation costs by $A1385 per patient and other long-term medication costs by $A360 per patient. In a subsample of patients, average quality of life was 0.98 (where 0 = dead and 1 = normal good health); the treatment groups were not significantly different. The absolute reduction in all-cause mortality was 3.0% (95% CI, 1.6%-4.4%), and the incremental cost was $3246 per patient, resulting in a cost per life saved of $107730 (95% Cl, $68626-$209881) within the study period. Extrapolating long-term survival from the placebo group, the undiscounted cost per life-year saved was $7695 (and $10 938 with costs and life-years discounted at an annual rate of 5%). Conclusions: Pravastatin therapy for patients with a history of myocardial infarction or unstable angina and average cholesterol levels reduces all-cause mortality and appears cost effective compared with accepted treatments in high-income countries.

Equity weights in the allocation of health care: the rank-dependent QALY model

This paper introduces the rank-dependent quality-adjusted life-years (QALY) model, a new method to aggregate QALYs in economic evaluations of health care. The rank-dependent QALY model permits the formalization of influential concepts of equity in the allocation of health care, such as the fair innings approach, and it includes as special cases many of the social welfare functions that have been proposed in the literature. An important advantage of the rank-dependent QALY model is that it offers a straightforward procedure to estimate equity weights for QALYs. We characterize the rank-dependent QALY model and argue that its central condition has normative appeal. (C) 2003 Elsevier B.V. All rights reserved.

The burden of major depression avoidable by longer-term treatment strategies

Background: Major depression is the largest single cause of nonfatal disease burden in Australia. Effective drug and psychological treatments exist, yet are underused. Objective: To quantify the burden of disease currently averted in people seeking care for major depression and the amount of disease burden that could be averted in these people under optimal episodic and maintenance treatment strategies. Design: Modeling impact of current and optimal treatment strategies based on secondary analysis of mental health survey data, studies of the natural history of major depression, and meta-analyses of effectiveness data. Monte Carlo simulation of uncertainty in the model. Setting: The cohort of Australian adults experiencing an episode of major depression in 2000 are modeled through "what if" scenarios of no treatment, current treatment, and optimal treatment strategies with cognitive behavioral therapy or antidepressant drug treatment. Main Outcome Measure: Disability-Adjusted Life Year. Results: Current episodic treatment averts 9% (95% uncertainty interval, 6%-12%) of the disease burden of major depression in Australian adults. Optimal episodic treatment with cognitive behavioral therapy could avert 28% (95% uncertainty interval, 19%-39%) of this disease burden, and with drugs 24% (95% uncertainty interval, 19%-30%) could be averted. During the 5 years after an episode of major depression, current episodic treatment patterns would avert 13% (95% uncertainty interval, 10%-17%) of Disability-Adjusted Life Years, whereas maintenance drug treatment could avert 50% (95% uncertainty interval, 40%-60%) and maintenance cognitive behavioral therapy could avert 52% (95% uncertainty interval, 42%-64%), even if adherence of around 60% is taken into account. Conclusions: Longer-term maintenance drug or psychological treatment strategies are required to make significant inroads into the large disease burden associated with major depression in the Australian population.

Burden of disease and injury in Aboriginal and non-Aboriginal populations in the Northern Territory

Objective: To quantify the burden of disease and injury for the Aboriginal and non-Aboriginal populations in the Northern Territory. Design and setting: Analysis of Northern Territory data for 1 January 1994 to 30 December 1998 from multiple sources. Main outcome measures: Disability-adjusted life-years (DALYs), by age, sex, cause and Aboriginality. Results: Cardiovascular disease was the leading contributor (14.9%) to the total burden of disease and injury in the NT, followed by mental disorders (14.5%) and malignant neoplasms (11.2%). There was also a substantial contribution from unintentional injury (10.4%) and intentional injury (4.9%). Overall, the NT Aboriginal population had a rate of burden of disease 2.5 times higher than the non-Aboriginal population; in the 35-54-year age group their DALY rate was 4.1 times higher. The leading causes of disease burden were cardiovascular disease for both Aboriginal men (19.1%) and women (15.7%) and mental disorders for both non-Aboriginal men (16.7%) and women (22.3%). Conclusions: A comprehensive assessment of fatal and non-fatal conditions is important in describing differentials in health status of the NT population. Our study provides comparative data to identify health priorities and facilitate a more equitable distribution of health funding.