Werner Brouwer

Economic valuation of informal care

Informal care makes up a significant part of the total amount of care provided to care recipients with chronic and terminal diseases. Still, informal care is often neglected in economic evaluations of health care programs. Probably this is related to the fact that the costs of informal care are to an important extent related to time inputs by relatives and friends of care recipients and time is not easy to value. Development of theoretically sound, yet easily applicable valuation methods is therefore important since ignoring the costs of informal care may lead to undesirable shifts between formal and informal care. Moreover, there is increasing evidence that providing informal care may lead to health problems for the caregiver, both in terms of morbidity and mortality. Until now these health effects have not been incorporated in economic evaluations. More attention for the identification and valuation of the full costs and (health) effects of informal care for the informal caregiver seems needed therefore. This contribution presents a critical evaluation of the available methods to incorporate informal care in economic evaluations.

Lifetime medical costs of obesity: Prevention no cure for increasing health expenditure

Background Obesity is a major cause of morbidity and mortality and is associated with high medical expenditures. It has been suggested that obesity prevention could result in cost savings. The objective of this study was to estimate the annual and lifetime medical costs attributable to obesity, to compare those to similar costs attributable to smoking, and to discuss the implications for prevention. Methods and Findings With a simulation model, lifetime health-care costs were estimated for a cohort of obese people aged 20 y at baseline. To assess the impact of obesity, comparisons were made with similar cohorts of smokers and “healthy-living” persons (defined as nonsmokers with a body mass index between 18.5 and 25). Except for relative risk values, all input parameters of the simulation model were based on data from The Netherlands. In sensitivity analyses the effects of epidemiologic parameters and cost definitions were assessed. Until age 56 y, annual health expenditure was highest for obese people. At older ages, smokers incurred higher costs. Because of differences in life expectancy, however, lifetime health expenditure was highest among healthy-living people and lowest for smokers. Obese individuals held an intermediate position. Alternative values of epidemiologic parameters and cost definitions did not alter these conclusions. Conclusions Although effective obesity prevention leads to a decrease in costs of obesity-related diseases, this decrease is offset by cost increases due to diseases unrelated to obesity in life-years gained. Obesity prevention may be an important and cost-effective way of improving public health, but it is not a cure for increasing health expenditures.

Productivity losses without absence: measurement validation and empirical evidence

Productivity losses without absence are scarcely discussed in the literature. In this paper, the construct validity of three different measurement instruments for productivity losses without absence is investigated. The data were collected under employees of a Dutch trade firm, not in specific patient groups. On an average day, over 7% of the respondents were working with health problems, indicating that productivity losses without absence is quite a common problem. The amount of production losses related to these health problems are relatively small. However, for specific patient groups, the costs related to these productivity losses may be substantial.

Need for differential discounting of costs and health effects in cost effectiveness analyses

The decision of the National Institute for Health and Clinical Excellence to abandon differential discounting of future health is a step backwards and could change funding decisions

The CarerQol instrument: A new instrument to measure care-related quality of life of informal caregivers for use in economic evaluations

The societal perspective in economic evaluations dictates that costs and effects of informal care are included in the analyses. However, this incorporation depends on practically applicable, reliable and valid methods to register the impact of informal care. This paper presents the conceptualisation and a first test of the CarerQol instrument, aimed at measuring care-related quality of life in informal caregivers. The instrument combines the information density of a burden instrument (encompassing seven important burden dimensions) with a valuation component (a VAS scale for happiness). The instrument was tested in a Dutch sample of heterogeneous caregivers (n = 175) approached through regional caregiver support centres. This first test describes the feasibility as well as convergent and clinical validity of the CarerQol instrument. The seven burden dimensions related well with differences in VAS scores. In all instances, the average CarerQol-VAS scores decreased as the severity of problems increased. Multivariate analyses showed that the seven burden dimensions explained 37–43% of the variation in CarerQol-VAS scores, depending on the model used. The CarerQol seems a promising new instrument to register the impact of informal caregivers in economic evaluations.

Productivity Costs Measurement Through Quality of Life? A Response to the Recommendation of the Washington Panel

This paper comments on the recently published guidelines of the Washington Panel on incorporation of indirect non-medical costs, or productivity costs, in economic evaluations of health care. Traditionally the human capital or more recently the friction cost method is used to measure these costs. The Panel, however, recommends incorporating productivity costs as health effects in the denominator of the C/E ratio. This paper argues that incorporation of productivity costs in cost-effectiveness analysis expressed as health effects is not correct. Only direct health related effects on quality of life that cannot be meaningfully monetarized should be considered as health effects. Furthermore, measuring productivity costs in terms of quality of life may lead to misrepresentation of these costs from a societal viewpoint. This misrepresentation occurs because of the existence of social security systems and private insurance compensating for income reductions from disease. Furthermore, the patients viewpoint is useful for quality of life measurement, but not for measuring productivity costs from a societal perspective. Finally, alternative recommendations are formulated for incorporating societal productivity costs in economic evaluations of health care.

An overview of methods and applications to value informal care in economic evaluations of healthcare.

This paper compares several applied valuation methods for including informal care in economic evaluations of healthcare programmes: the proxy good method; the opportunity cost method; the contingent valuation method (CVM); conjoint measurement (CM); and valuation of health effects in terms of health-related quality of life (HR-QOL) and well-being. The comparison focuses on three questions: what outcome measures are available for including informal care in economic evaluations of healthcare programmes; whether these measures are compatible with the common types of economic evaluation; and, when applying these measures, whether all relevant aspects of informal care are incorporated.All types of economic evaluation can incorporate a monetary value of informal care (using the opportunity cost method, the proxy good method, CVM and CM) on the cost side of an analysis, but only when the relevant aspects of time costs have been valued. On the effect side of a cost-effectiveness or cost-utility analysis, the health effects (for the patient and/or caregiver) measured in natural units or QALYs can be combined with cost estimates based on the opportunity cost method or the proxy good method. One should be careful when incorporating CVM and CM in cost-minimization, cost-effectiveness and cost-utility analyses, as the health effects of patients receiving informal care and the carers themselves may also have been valued separately. One should determine whether the caregiver valuation exercise allows combination with other valuation techniques.In cost-benefit analyses, CVM and CM appear to be the best tools for the valuation of informal care. When researchers decide to use the well-being method, we recommend applying it in a cost-benefit analysis framework. This method values overall QOL (happiness); hence it is broader than just HR-QOL, which complicates inclusion in traditional health economic evaluations that normally define outcomes more narrowly. Using broader, non-monetary valuation techniques, such as the CarerQol instrument, requires a broader evaluation framework than cost-effectiveness/cost-utility analysis, such as cost-consequence or multi-criteria analysis.

Burden of informal caregiving for stroke patients: Identification of caregivers at risk of adverse health effects

Background: We assessed the objective and subjective burden of caregiving for stroke patients and investigated which characteristics of the patient, the informal caregiver and the objective burden contribute most to subjective burden and to the condition of feeling substantially burdened. Methods: We studied a sample of 151 stroke survivors and their primary informal caregivers. We collected data through patient and caregiver interviews 6 months after stroke. Results: Both the level of subjective burden and the condition of feeling substantially burdened were associated with both caregiver’s and patient’s health-related quality of life, patient’s age, and the number of caregiving tasks performed. Conclusions: These conditions can be used in clinical practice to identify potentially vulnerable caregivers in need of support and at risk of adverse health effects. Monitoring stroke survivors as well as their family caregivers at discharge may help to prevent or alleviate caregiver burden.

On the economic foundations of CEA. Ladies and gentlemen, take your positions!

There are still many ongoing debates about several aspects of the methodology of economic evaluations of health care interventions. Some of the disparities in recommendations on methodological issues may be traced back to different viewpoints on cost-effectiveness analysis (CEA) in general. Two important views are the welfarist approach, which aims at embedding CEA into traditional welfare economics, and the decision makers approach, which takes a broader and more pragmatic view on CEA. The focus in welfarism may be on utility while that of the decision makers approach may be considered to be on health. In this paper it is examined how these two views differ and how these differences may subsequently lead to debates in methodological areas. It is indicated that embedding the practical operationalization of CEA in welfare economics seems impossible. In a strict welfarist approach it is necessary to view QALYs as being utilities, although one may question whether such an approach to QALYs is appropriate. Also, equity considerations may play an important role in cost-effectiveness analysis and these should preferably be taken into account in a way that reflects societal attitudes towards an equitable distribution of health care. These equity considerations may not always be directly related to utility or efficiency. Furthermore, both camps may prefer different methods for cost measurement in areas such as productivity costs and informal care. A better recognition of the contents and origins of controversies and disputes may enhance the clarity of discussions.

Discounting and decision making in the economic evaluation of health-care technologies

Discounting costs and health benefits in cost-effectiveness analysis has been the subject of recent debate - some authors suggesting a common rate for both and others suggesting a lower rate for health. We show how these views turn on key judgments of fact and value: on whether the social objective is to maximise discounted health outcomes or the present consumption value of health; on whether the budget for health care is fixed; on the expected growth in the cost-effectiveness threshold; and on the expected growth in the consumption value of health. We demonstrate that if the budget for health care is fixed and decisions are based on incremental cost effectiveness ratios (ICERs), discounting costs and health gains at the same rate is correct only if the threshold remains constant. Expecting growth in the consumption value of health does not itself justify differential rates but implies a lower rate for both. However, whether one believes that the objective should be the maximisation of the present value of health or the present consumption value of health, adopting the social time preference rate for consumption as the discount rate for costs and health gains is valid only under strong and implausible assumptions about values and facts.