Accounting for Nonhealth and Future Costs in Cost-Effectiveness Analysis: Distributional Impacts of a US Cancer Prevention Strategy

David D. Kim ()
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David D. Kim: The University of Chicago

PharmacoEconomics, 2023, vol. 41, issue 9, No 10, 1164 pages

Abstract: Abstract Objective To provide up-to-date and comprehensive US data tables to estimate future net resource use, including nonlabor market production, and examine distributional impacts of including nonhealth and future costs in cost-effectiveness results. Methods Using a published US cancer prevention simulation model, the paper evaluated the lifetime cost effectiveness of implementing a 10% excise tax on processed meats across age- and sex-specific population subgroups. The model examined multiple scenarios accounting for cancer-related healthcare expenditure (HCE) only, cancer-related and unrelated background HCE, adding productivity benefits (i.e., patient time, cancer-related productivity loss, and background labor and nonlabor market production), and with nonhealth consumption costs, adjusted for household economies of scale. Additional analyses include using population-average versus age–sex-specific estimates for quantifying production and consumption value, as well as comparing direct model estimation versus postcorrections with Meltzer’s approximation for incorporating future resource use. Results Accounting for nonhealth and future costs impacted cost-effectiveness results across population subgroups, often leading to changes in “cost-saving” determination. Including nonlabor market production had a noticeable impact on estimating future resource use and reduced the bias toward undervaluing productivity among females and older populations. The use of age–sex-specific estimates resulted in less favorable cost-effectiveness results compared with population-average estimates. Meltzer’s approximation provided reasonable corrections among the middle-aged population for re-engineering cost-effectiveness ratios from a healthcare sector to a societal perspective. Conclusion With updated US data tables, this paper can help researchers conduct a comprehensive value assessment to reflect net resource use (health and nonhealth resource use minus production value) from a societal perspective.

Date: 2023
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DOI: 10.1007/s40273-023-01275-6

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