Issue: July 2015
July 15, 2015
3 min read

The Physician as the Health Economist: A Necessity of Today

Issue: July 2015
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Years ago, I saw a presentation from the leader of the United Kingdom’s National Institute for Health and Care Excellence where seven 4-year-olds were lined up next to each other at the head of a king-sized bed. On the right-hand side, another child is trying to get into the bed and, as that child tries to get in, the one on the left-hand side is falling out.

Michael Saag

Michael S. Saag

In this cartoon, space in the bed is a limited resource. In our daily practices today, we need to be cognizant of our own limited resources.

Whether we like it or not, we’re going to have to become health economists as providers. When most of us were going through our training, our primary focus was understanding the biology of disease and what therapeutic regimens could either reverse or control disease processes to allow the highest degree of function.

In many ways, this hasn’t changed, but what’s been added to the equation for us is understanding the role of cost and health care expenditures in medical decision-making.

As providers, we always have been the patient’s advocate. We were the person who laid on our sword to make sure that every patient got what they needed in terms of access to care, access to medications, and access to every resource that could be used to assure the patient’s wellbeing.

It’s becoming clear that we’re no longer solely responsible for the individual patient sitting across from us. We’re also responsible for the next patient who will be sitting across from us and the one after that and the one after that. Our responsibilities have been expanded to more than just being a single patient advocate, to being an advocate for all patients in the health care system.

The realization that resources, whether we like it or not, are finite, is becoming more and more of a reality. The hepatitis C story is a great example of how providers are thrown into the middle of a chaotic struggle between what’s right for that individual patient and what the system can afford for all of the other individuals. And just like in HCV therapeutics, the ‘system’ will begin to tell us more and more what we can and can’t do for a given patient we are treating.

One of the things we can use besides just our instinct and guesswork about what is an appropriate cost vs. an excessive cost of a medicine as we advocate for our individual patients is to use standard health economics metrics, such as cost-effectiveness evaluations. And that means that we are going to have to become well versed in the notions of quality adjusted life years, or QALYs, and incremental cost-effectiveness ratios, or ICERs.

In this issue of HCV Next, we highlight the results of Rein and colleagues that describe the relative cost effectiveness of the newer treatments and what is judged to be cost effective and what is not.

As a rule of thumb, cost effectiveness is mostly determined in its ICER.  Whether a given ICER is “cost-effective” varies in each country, dependent on its gross domestic product (GDP). In the United States, with perhaps one of the highest GDPs, a cost-effective ICER cut-point is somewhere around $50,000 per QALY gained.

We also have to take into account coexistent conditions to determine what resources are worthy of expenditure. The cost of eliminating hepatitis C only makes sense in the context of the patient’s total clinical picture; for example, a patient with a terminal malignancy or a debilitating illness that’s going to limit long-term survival should preclude us from attempting to “cure” their HCV infection.

Working within the “system,” we have to be judicious about where resources are spent over time. Using cost effectiveness information helps the system determine the value of each intervention, not just for a single individual but for all individuals with a given condition.

From the system’s perspective, what we do for one patient — who is like that child trying to get into the bed — will likely limit what we can do for our next patient (the child falling out), whether we realize it or not.

We need to readjust our thinking from focusing solely on the patient sitting across from us, to being cognizant of the system’s consideration of the patient who is not sitting across from us right now. He or she might be sitting across from us tomorrow or the next day and, from a systematic perspective, we need to have the resources to treat them as well. Understanding these dynamics and understanding how the system is using economic metrics will help us maintain balance as we advocate for our patients now and in the future.

Michael S. Saag, MD
Co-Chief Medical Editor HCV Next