Recently, the Journal of the American Medical Association (JAMA) published findings and recommendations from the Second Panel on Cost-Effectiveness in Health and Medicine, detailing what the authors consider to be best practices in the field. Findings from the original panel were first published in 1996, and since then, cost-effectiveness analysis (CEA) has become a field of increasing interest, particularly with emerging frameworks and tools that rely on CEA to quantify the value of medicines. This includes the framework developed by the Institute for Clinical and Economic Review.
Several of the panel’s recommendations, developed by academic thought leaders in the field of CEA, echo positions in PhRMA’s Principles for Value Assessment Frameworks released earlier this year. Highlights from the Second Panel on Cost-Effectiveness in Health and Medicine include:
- Acknowledge a broad range of benefits, including health and non-health related benefits. The panel recommends the inclusion of an impact inventory that lists both the health and non-health effects of a health care treatment or intervention. Inclusion of this list will ensure that all costs and benefits of a treatment, including those outside of health care, will be accounted for in a transparent manner, even in analyses restricted to the health care sector. In particular, the importance of comprehensively capturing effects of productivity is emphasized.
- CEA should consider multiple perspectives. According to the panel, cost-effectiveness studies should report findings from both the health care perspective and the societal perspective. The health care perspective includes both current and future, long-term medical costs. The societal perspective includes these medical costs, as well as other potential costs and benefits, such as patient time, time given by caregivers, transportation costs and employment impact.
- The perspective of every analysis should be clearly reported. According to the panel, it may be necessary to consider an analysis from a specific point of view, such as that of a payer or a patient. If an analysis is performed from a certain perspective, those conducting the analysis should be transparent about the intended audience.
- Analyses should be transparent. The items included in a cost-effectiveness analysis and the value placed on those items can vary depending on the analyst and intended audience. Analysts should be transparent about how they have conducted the analyses and describe how the results change when different assumptions are made around elements of the model. This transparency is essential for ensuring that other stakeholders can validate the analysis.
The panel also notes key areas for future research, including use of multiple-criteria decision analysis and group decision-making; use of CEA and value-based pricing or coverage or clinical guideline decisions; the link between CEA and incentives for innovation; comparisons of community versus patient preferences used to calculate quality-adjusted life years; and family spillover effects.
While stakeholders may disagree on the appropriate role of cost-effectiveness analysis in health care, most would agree that we should start with strong methods. Advancing sound models for value assessment is just one element of PhRMA’s agenda in support of value-driven health care.
Learn more about PhRMA’s position on value-driven health care here.