Pieter Van Baal, Institute of Medical Technology Assessment (iMTA), Erasmus University Rotterdam presented the Centre for Health Economics Seminar, University of York, 28th March 2013

1. Confronting NICE decision rules with
NICE guidelines for technology
assessment: the case of unrelated
medical care
Pieter van Baal
vanbaal@bmg.eur.nl

2. Contents
• Background: future unrelated medical care & NICE guidelines
• NICE decision framework & future unrelated medical care
• Case study: TAVI
• Conclusion & discussion

3. Ageing and the NHS

4. Future unrelated medical care
• Medical interventions that increase life expectancy of patients may cause additional
consumption of health care in so-called „added life years‟.
– Added years are those years that would not have been lived without the
intervention.
• part of this medical care in added years is directly related to the intervention:
– CVD care after angioplasty
• Other care in added years is not directly related to the intervention and termed
„unrelated medical care‟:
– E.g. costs of treating dementia after angioplasty

5. NICE guidelines
• Guideline 5.5.1
– “For the reference case, costs should relate to resources that are under the
control of the NHS and PSS when differential effects on costs between the
technologies under comparison are possible.”
• However, guideline 5.5.6:
– “ Costs related to the condition of interest and incurred in additional years of life
gained as a result of treatment should be included in the reference-case
analysis. Costs that are considered to be unrelated to the condition or
technology of interest should be excluded.”
NB: the Netherlands have similar guidelines

6. Future unrelated medical care in real life: a
lesson in Dutch Royal history…

7. Prince Bernhard: 1911-2004
• Husband of Queen Juliana of the Netherlands & father of monarch Queen Beatrix
• Unofficial world champion unrelated medical care:
– Plenary speaker at a anesthesiology conference in 1992:
• „My first operation was at the age of 2‟.
• „I have been operated in hospital more than 40 times‟
• „I have spent more than three years of my life in hospital‟
– A small selection:
• Almost died at age 17 due to a heavy pneumonia
• Serious car accident
• Stroke in 2000
• Cancer:
– 1994: colorectal:
– 2000: breast
– 2004: lung cancer leads to death

8. Prince Bernhard : 1911-2004
• What is unrelated medical care?
– From the perspective of treating stroke:
• Treatment of cancer
– From the perspective of treating cancer;
• Treatment of stroke
– From the perspective of treating pneumonia at age 17:
• Care after car accident
• Cancer care
• Stroke care
• What is the cost-effectieness of treating pneumonia at age 17?
{costs (pneumonia) } / {93 – 17}
Or
{costs (pneumonia + car crash + stroke + cancer ) } / {93 – 17}

9. How can we explain guidelines?
• Theoretical literature shows that a convincing case to exclude future unrelated
medical costs has never been made
– exclusion of future unrelated medical costs results in a suboptimal allocation of
resources from both a societal perspective and a health care perspective
(Meltzer 1997).
– more recent revival of the debate was fueled by a paper containing already-
refuted arguments (Lee 2008; Meltzer 2008; Feenstra et al. 2008).
– NB: most discussion focused on future non-medical costs
• However, often heard more informal arguments (Morris et al. 2007; Drummond et
al. 2005):
– it is difficult to estimate these costs
• implicitly assuming these costs to equal zero is by definition biased
• There are methods
– their size is negligible
• This is not true in all cases
– these costs relate to specific treatments that themselves should be evaluated
• it would be consistent to exclude the benefits of unrelated medical care as
well

10. NICE decision rules
Table 1: incremental costs and benefits in two periods for intervention i
Time period 1 2
Present value of health gained ∆ℎ1 ∆ℎ2
𝑘(1 + 𝑟)
Present value of health forgone ∆𝑐1 ∆𝑐2
𝑘 𝑘(1 + 𝑟)
∆ℎ1 , ∆ℎ2 denote incremental QALYs in period 1 and 2; ∆ℎ𝑐1 , ∆𝑐2 denote health care expenditures in
period 1 and 2; k denotes the threshold; r denotes the discount rate.
Adopt intervenion i if:?

11. Introducing costs of unrelated medical care
• Suppose now that intervention i we are evaluating is targeted at disease x.
• However, because survival is affected as the intervention adds one year of life,
there will also be costs for disease y in added life years:
– ∆C2 = ∆C2(x)+ ∆C2(y)
– ∆C2(y) are the so-called future unrelated medical costs as they are purely the
result of living longer.
• If ∆C2(y) are excluded this implies that:
– present value of health benefits foregone is underestimated:
∆C2(y) / { k (1+r)-1 }
– the ICER is underestimated:
{∆C2(y) (1+r)-1 } / {∆H1 + ∆H2 (1+r)-1 }
• As only evaluations of life prolonging interventions are influenced by this bias.
Ignoring costs of unrelated medical care results in implicitly favouring life-prolonging
interventions over quality of life improving interventions.

12. Options to remove this bias
1. From now on routinely include costs of unrelated medical care:
– Easiest solution
2. Adjust the threshold:
– Adjustment would be different for each intervention.
– Interpretation of both ICER and threshold would be unclear
3. Also adjust the benefit side for the effects of unrelated medical care
– If unrelated medical care is cost-effective, costs and benefits thereof should
always be included:
• Exclusion in this case would imply running the risk of rejecting cost-
effective technologies
– Excluding costs and benefits of unrelated medical care worthwhile if:
• Unrelated medical is cost-ineffective
• We have not committed to this cost-ineffective unrelated medical care
– Empirical challenges
• In general, unrelated medical care is a mix of interventions, costs and
benefits of individual interventions will be hard to tease out.
• cost effectiveness unrelated medical care will be some sort of average
return to health care expenditures
– Therefore, should be below the threshold

13. Case study: TAVI
• Transcatheter Aortic-Valve Implantation (TAVI) (Watt et al. 2012):
– Life prolonging intervention for patients with severe aortic stenosis and
coexisting conditions which are not candidates for surgical replacement of the
aortic valve (Leon et al. 2010).
– Average age of patient group is 80
• Recently, an economic evaluation of TAVI was produced using NICE guidance
(Watt et al. 2012):
– Life years gained almost 2 years per patient
– Costs of unrelated medical care were excluded, benefits were implicitly taken
into account
– ICER: 16,100 pound per QALY
• Target population is old and frail and, therefore, costs of unrelated medical care are
relevant.
• What would the cost-effectiveness of TAVI be if costs of future unrelated medical
care are included?

14. Estimating costs unrelated medical care TAVI
• Similar methodology as employed in Practical Application to Include Disease Costs
(PAID: ) which is a tool that allows to estimate future unrelated medical in a
standardized manner for the Netherlands (van Baal et al. 2011).
– per capita health care expenditures for unrelated diseases are the sum of per
capita disease-specific expenditures that vary by:
• Age, proximity to death, gender
– Combine this with survival curves
– NB: download PAID from: www.bmg.eur.nl/personal/vanbaal/paid.htm
• Data sources used to estimate per capita costs of unrelated medical care for
England (NB: 2010 price level):
– NHS costs
• hospital expenditures stratified by proximity to death as published by
Seshamani and Gray (Seshamani and Gray 2004a).
• per capita non-hospital expenditures as estimated by the Office Health
Economics (Hawe et al. 2011) stratified by age
• to avoid double counting costs for cardiovascular disease were extracted
from all NHS expenditures (+/- 10%; Hawe et al. 2011).
– PSS costs related to care for the elderly per capita were taken from a recent
publication by the Nuffield trust (Wittenberg et al. 2012).

15. TAVI: results
Quarterly per capita costs unrelated medical care
Combining the estimates as in
7000
figure on the right with the Died at 81 Died at 85
survival curves resulted:
6500
- Incremental lifetime costs of
unrelated medical care of
£11,600 per patient
6000
- with a threshold of £20,000,
£ (2010 prices)
ignoring £11,600 implies an
5500
underestimation of the
present value of health
5000
foregone of more than 0.5
QALY per patient
4500
- an increase of the ICER of
7,400 pound per QALY from
£16100 to £ 23,500 per
4000
QALY
80 81 82 83 84 85
NB: these estimates can be Age
seen as a lower limit given the
high amount of comorbidity in
the target group

16. Conclusion
• Current NICE guidelines are in conflict with the underlying goals and decision rules:
• Even economic evaluations following the same current NICE guidelines lead to
incomparable results
• Simple solution  delete Guideline 5.5.6 (would also eliminate confusion as to
classify what costs/diseases are related)
• Unrelated medical care should be explicitly addressed in economic evaluations.
– Most simple way to do that is by simply including the costs of unrelated medical
care
• Just as all models have an „other cause mortality` all models should have
„other causes medical expenditures‟
• Empirically feasible but assumes that unrelated medical care itself is cost-
effective
– In case unrelated medical is cost-ineffective, present ICER excluding both
costs and benefits of unrelated medical care
• Empirically challenging
• TAVI case study demonstrates:
– Relevance of future unrelated medical costs
– How to include these costs

17. Discussion
• Empirical challenges:
– In our case study, we used different sources to construct unrelated medical
costs per capita needed for our calculations.
– Further improvements in this area should be possible given the data sources
available in England (Martin et al. 2008; Seshamani and Gray 2004b) .
– Age-specific per capita costs do not always suffice in all situations.
• Threshold: is the value of k is set appropriately?
– If the threshold is based on an inventory of published ICERs, k is
underestimated which demonstrates another mechanism through which
ignoring costs of unrelated medical care distorts optimal decision making
– Recent empirical estimates also excluded costs of unrelated medical care
(Claxton et al. 2013): increases in disease specific spending instead of total
spending were linked to changes in life years
• Perspective & future non-medical costs (survivor consumption)
– TAVI intervention highlights the tension between a strict health care
perspective and a broader societal perspective

18. Relevant literature
• Feenstra TL, van Baal PH, Gandjour A, Brouwer WB. Future costs in economic evaluation. A
comment on Lee. J Health Econ 2008 Dec;27(6):1645-9;
• Hawe, E., Yuen, P., Baillie, L. 2011. OHE guide to UK health and health care statistics.
• Leon, M.B., Smith, C.R., Mack, M., Miller, D.C., Moses, J.W., Svensson, L.G., Tuzcu, E.M.,
Webb, J.G., Fontana, G.P., Makkar, R.R. Transcatheter aortic-valve implantation for aortic
stenosis in patients who cannot undergo surgery. New England Journal of Medicine 2010; 363;
1597-1607.
• Meltzer, D. Accounting for future costs in medical cost-effectiveness analysis. Journal of Health
Economics 1997; 16; 33-64.
• Seshamani, M., Gray, A. Ageing and health-care expenditure: the red herring argument
revisited. Health Economics 2004a; 13; 303-314.
• van Baal, P.H.M., Wong, A., Slobbe, L.C.J., Polder, J.J., Brouwer, W.B.F., de Wit, G.A.
Standardizing the inclusion of indirect medical costs in economic evaluations.
PharmacoEconomics 2011b; 29; 175-187.
• van Baal PH, Meltzer D, Brouwer , WB. Pharmacoeconomic Guidelines Should Prescribe
Inclusion of Indirect Medical Costs! A Response to Grima et al. PharmacoEconomics 2013 May
• Watt, M., Mealing, S., Eaton, J., Piazza, N., Moat, N., Brasseur, P., Palmer, S., Sculpher, M.
Cost-effectiveness of transcatheter aortic valve replacement in patients ineligible for
conventional aortic valve replacement. Heart 2012; 98; 370-376.
• Wittenberg, R., Hu, B., Comas-Herrera, A., Fernandez, J.L. 2012. Care for older people.