What is Cost Effectiveness Analysis (CEA)?
Cost Effectiveness Analysis is a type of economic evaluation that examines both the costs and health outcomes of alternative intervention strategies. CEA compares the cost of an intervention or the value of various clinical strategies to its clinical effectiveness as measured in positive health outcomes, such as cases prevented, years of life saved, or quality-adjusted life years.
Cost per Outcome: the Cost Effectiveness Ratio
CEA results are presented as the cost per positive health outcome, such as cost per case prevented, cost per year of life saved, or cost of quality-adjusted life years. CEA results are used to allocate healthcare resources.
For example, most of you are familiar with allocation methods for transplant lists. In some lists the sickest patient rises to the top of the list, in other lists the patient with the best chance for survival rises to the top.
Quality-Adjusted Life Years and Allocation
Often, the change in outcomes is measured in quality-adjusted life years or QALY. One year in perfect health is equal to 1.0 QALY.
Suppose an older individual receives a intervention and is expected to require a year for recovery at 30% of perfect health or 0.3 QALY and fours years of additional life at 80% health or 0.8 QALY, for a total of 3.5 QALY over five years. Contrast that with the same intervention given to a younger individual who is expected to recover for one year at 30% of perfect health and then live for 20 years in perfect health for a total of 20.3 QALY over 22 years.
If society can only afford one procedure, it makes sense to 'spend' the procedure on the individual who will receive the most benefit. The fear of every aging American is that they will be denied healthcare, even after a lifetime of societal contribution.
The impact for device manufacturers may be a lower rate of sales.
Cost effective and cost savings
It's important to carefully consider what cost-effectiveness means. If a strategy is dubbed "cost-effective" and the term is used as its creators intended, it means that the new strategy is a good value. Being cost-effective does not mean that the strategy saves money, and just because a strategy saves money doesn't mean it is cost-effective. The very notion of cost-effective requires a value judgment, that is, what one thinks is a good price for improved clinical outcomes.
Why spend your time with us?
Dr. Vincent Jaeger, MD works with the concept of cost effective analysis everyday in his current position as a hospital administrator, and has used the concept in the past in his work at Aetna. He is in a unique position to help you understand the potential consequences of CEA to your firm.
You will receive
[x] PowerPoint slides.
[x] Knowledge of cost effective analysis.
[x] Knowledge of healthcare allocation issues.
[x] Insights into how CEA may effect your firm.
[x] An expert speaker.
[x] Opportunity for QnA.
[x] CEUs and certificate of attendance.
Who should attend
[x] Top management at medical device firms.
[x] Middle management at medical device firms.
[x] People who make strategic company decisions.
Dr. Vincent Jaeger, MD,held a senior leadership role at Aetna for 12 years, where he specialized in critically evaluating new devices, drugs, and procedures for coverage and reimbursement determinations.
He received his medical degree from Albany Medical College and is a board certified Thoracic and Cardiovascular Surgeon; he practiced for 12 years in Hartford, CT before entering Manager Care as a physician executive. You may contact him at Jaeger Medical Research Associates.
The purchase is $428 for OnDemand access and $478 for the CD. Each attendee is eligible for 0.15 CEUs upon completing the course feedback via the link provided with the event materials. Click here to purchase.