ECO 605 Discussion 5.1: Economic Evaluation

The health ailment used will be Covid-19. The economic evaluation used for a new treatment of Covid-19 would be the Cost-Effective analysis. The formula for this analysis is (Cost2 – Cost1) / (Outcome2 – Outcome1) where 1 and 2 describe the alternative interventions (Hicks, 2021). There is not a single, agreed upon treatment regimen for Covid-19. Most providers in intensive care units give additional vitamins, minerals, steroids, electrolytes, breathing treatments, and other medications; however the doses, medication administration schedules, and the treatment regimens often vary from provider to provider or facility to facility. The current treatments for Covid-19 are not 100% agreed upon and can be extremely expensive depending on the prescribing provider. The Cost-Effective analysis helps determine the difference in costs vs. the difference in outcomes between two interventions. The outcome for the treatments of Covid-19 currently vary. With the different treatment regimens, there have been patients who recover and patients who have died.

The Cost-Effective analysis technique would work well because if a one time treatment for Covid-19 was to come out, this would be far cheaper than an inpatient stay at the hospital for two or more weeks while receiving a treatment regimen that is not a guarantee. The cost effective analysis would allow for the comparison of the new treatment’s price to the price of a patient’s hospital stay battling Covid-19.

This analysis technique could help identify inexpensive treatment options that have significant results, such as vitamin C and zinc daily tablets, since they help boost the immune system and are relatively inexpensive (Mayo Clinic, 2021).

The Cost-Effective analysis helps find methods to redistribute resources to achieve more (Hicks, 2021). It helps focus resources toward

ECO 605 Discussion 5.1 Economic Evaluation

more cost-effective interventions. Ivermectin, a medication used to treat parasites commonly found in farm animals, has controversial opinions on whether it helps Covid-19 patients. If a new treatment were to arise that was proven to help Covid-19, then this analysis would help prove that Ivermectin should not be used due to its unproven benefits. Hospitals could redistribute resources and treat people with an evidence-based treatment rather than a skeptical treatment.

Using the Cost-Effective analysis would be helpful for the new treatment because when determining the effectiveness for the new treatment vs. previous treatments, lives saved would be the unit for measuring effectiveness. This is a straightforward measurement; was the patient’s life saved by the treatment or not.

This analysis method could also use the outcome measurement of Quality Adjusted Life Year or QALY. QALY represents the quality and quantity of life (Hicks, 2021). This is important because quality of life after the treatment is important when considering treatment options for Covid-19. The treatment option Remdesivir has been associated with damaging kidneys in some patients (Mayo Clinic, 2021). The Cost-Effective analysis could help determine if the costs and outcomes of particular treatments are reasonable regarding QALY.

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References

Hicks, L. L. (2021). Economics of Health and Medical Care. Jones & Bartlett Learning.

Mayo Foundation for Medical Education and Research. (2021, December 4). Mayo Clinic. Retrieved January 27, 2022, from https://www.mayoclinic.org/coronavirus-covid-19.

Adding a new treatment to an existing pool of options in the healthcare sector can be difficult. For diabetic treatment there already several options that work well. If someone wanted to bring a new treatment/ intervention to the market an economic evaluation would need to be completed. The addition of a support RN for complex diabetic care which includes one or more complication from diabetes and insulin use will be the new treatment/ intervention. The techniques utilized for this post will be comparing alternatives, quantification of outcomes, replacing poor information, perspective, and discounting over time (Hicks 2021).

Complications such as neuropathy macular degeneration, hyperglycemia, coma, and even amputations are possible when someone has uncontrolled diabetes. Several programs for diabetes monitoring and assistance exist, but many of them are only offered to certain populations and can be difficult to navigate. A new treatment would need to be easily accessible and something that won’t confuse or frustrate a patient. Primary care providers often hear patients say that insulin sliding scale is too complex, or that the patient has run out of medication and forgotten to reach out for more. Having a point of contact to help aid the patient would be an improvement on current programs. The nurses in this program would connect weekly directly with the patient and act as an intermediary between patient and provider. Nurses in this position could request refills, report a change in status or symptoms, and request an office visit when necessary.

An easy to use, supportive RN who can help answer medication questions and show patients how to care for themselves can provide better patient outcomes (Conway et al., 2019). In addition to improving patient care and management of diabetes, these programs can help keep patients from seeking emergent care. The cost of poorly controlled diabetes on the healthcare system is in the billions annually and can be drastically reduced if patients can be kept out of the hospital (McLendon et al., 2019). This quantification of outcomes is where a new treatment proves to be of value.

Nurses who meet and interact with these clients can provide much needed education about diabetes management. When patients are informed, they have a chronic disease that requires at home monitoring and management it can be overwhelming. Information is often lost or not processed (McLendon et al., 2019). Patients can become confused or be given incorrect information regarding diabetes care. Reorientation and support from an RN can help dispel misinformation and keep patients on the right track.

From the perspective of the healthcare system, an investment into additional support staff to aid in diabetes management makes sense. Quality diabetic care is a metric by which reimbursement is based on and improvements in quality means an increase in the rate at which services are reimbursed. This also means a decrease in costly complications from uncontrolled diabetes (Conway et at., 2019). By identifying the health care system as the perspective and the benefits being the outcomes a reduction in cost of care is the best decision can be made regarding this intervention (Hicks 2021). Future discounts is the last consideration for this example. The risk is high with uncontrolled diabetic care, which means the discounts offered can be larger in the future (Hicks 2021). There are a lot of complications a healthcare system can be responsible for. With the addition of a nurse-led education and support system this new intervention for diabetic care would be a beneficial addition for patient care.

Conway, A., O’Donnell, C., & Yates, P. (2019). The effectiveness of the nurse care coordinator role on patient-reported and health service outcomes: A systematic review. Evaluation & the health professions, 42(3), 263-296.

Hicks, L. (2021). Economics of health and medical care. Jones & Bartlett Publishers.

McLendon, S. F., Wood, F. G., & Stanley, N. (2019). Enhancing diabetes care through care coordination, telemedicine, and education: Evaluation of a rural pilot program. Public Health Nursing, 36(3), 310-320.

Discussion 5.1:

Initial Post: In your initial post, identify which economic evaluations you would use for a new treatment of a health ailment of your choosing. Assume that there are already existing alternative treatments for the same ailment. Be sure to include at least five reasons in support of the economic evaluation technique.

The health ailment is headaches. There are already existing otc alternative treatments/interventions for headaches (otc ASA) and this is a new otc medication called ‘eliminate’.

The economic evaluation used for the new headache treatment is the incremental cost-effectiveness ratio (ICER) because this is a new treatment for an existing problem. It compares the difference in cost to the difference in outcomes. It is calculated as ICER = (Cost New – Cost Old) / (Effect New – Effect Old), (Hicks pgs., 220-221).

Five reasons for the use of ICER in this example are

ICER is flexible by constructing cost-effect, budget impact to provide economic value, affordability and value-basis’,
ICER allows for multiple variabilities.
ICER provides feedback for when a new treatment is costlier with improved health effects.
ICER gives information on the extra unit of effectiveness, and
ICER gives the trade-off between outcomes for new versus old treatment.

Examples in support of this economic evaluation technique for comparisons of new and existing treatments are provided. ICER provides multiple ways for comparison of the new (eliminate) treatment/intervention approach to the existing (aspirin) approach, so the consumer can make decisions, such as:

Eliminate is both less expensive and more effective than aspirin. This allows for consumer adoption of eliminate based on both efficacy and expense being optimal. “I get rid of my headache with eliminate and costs less than aspirin.”
Eliminate is less costly but less effective than aspirin. If this is true, then the consumer would reflect on the lower financial effect with lower health result. “Sometimes I get rid of my headache with eliminate but I save money.”
Eliminate costs more but is more effective than aspirin. Here the consumer would see and decide if the gain in health would factor in for the added cost of buying eliminate. “I will always get rid of my headache with eliminate and am willing to pay for this.”
Eliminate is costlier and less effective than aspirin. Here the consumer would choose to remain with aspirin and not replace it with eliminate. “Why would one pay more for eliminate when it doesn’t work well like aspirin and also costs more than aspirin?”
Eliminate is equal in cost and equal in effect to aspirin. This would allow the consumer to use either for headaches. “One can buy either aspirin or eliminate and successfully get rid of headaches and it would cost the same.”

Hicks, L. L. (2021). Economics of health and medical care. (7th ed.). Jones & Bartlett Learning. ISBN-13: 9781284183535

For the purpose of this assignment, I will be looking at the use of insulin in the management of diabetes (type 2). In regards to the management of diabetes, there are a lot of different options such as pills, insulin, injections, etc. The method of economic evaluation I will use is benefit-cost analysis. When using this evaluation, one need to be addressed is the valuation of outcome. Basically a dollar value is assigned to different treatments and it causes valuation of outcomes and characteristics of treatment. For example, if you’re looking at insulin, one will look into the cost of it as well as the characteristics that come with having to inject oneself. If you’re looking at medications, such as Farxiga, you will look at the cost as well as the characteristics of taking the medication. Another need to be addressed in this evaluation is human capital. This is put in dollar terms and it will show if using insulin causes a loss of leisure time to stop and inject yourself with insulin, or rather, if taking pills causes more of a loss of leisure time. The next need to be addressed in this evaluation is risk preferences. This need will reflect on the personal preferences of the patients involved. In regard to the use of insulin in treatment of diabetes, we have to look at individuals’ values and if they believe in injecting themselves because some might view that as harmful for the body. In regards to using medications, some individuals might have values that say that medications are chemicals and an individual must only use herbal remedies to treat themselves. The next reason to support this evaluation technique is because it uses contingent valuation. This is important because individuals are asked if they would pay to achieve benefits of, let’s say, maintaining blood sugar, by either using insulin or pills. Lastly, a reason to support this evaluation technique is, according to the presentation on Bradley University, “there’s different ways to value, particularly the benefit of new and existing treatments. And you have to know that these different techniques and valuing benefits of interventions give very different results, and so the best measure depends on the purpose of the investigation.” In regards to the treatment of diabetes, an individual must know about not only the cost of insulin and all the alternative treatments for diabetes, but they must also know the benefits and results of using the treatments. To conclude, if using the benefit cost analysis for the treatment of diabetes, you must look at all aspects of costs and benefits in order to see if this treatment is best for individuals or if there are alternative treatments.