Rewarding healthy behaviors--pay patients for performance

Despite a considerable investment of resources into pay for performance, preliminary studies have found that it may not be significantly more effective in improving health outcome measures when compared with voluntary quality improvement programs. Because patient behaviors ultimately affect health outcomes, I would propose a novel pay-for-performance program that rewards patients directly for achieving evidence-based health goals. These rewards would be in the form of discounts towards co-payments for doctor's visits, procedures, and medications, thereby potentially reducing cost and compliance issues. A pilot study recruiting patients with diabetes or hypertension, diseases with clear and objective outcome measures, would be useful to examine true costs, savings, and health outcomes of such a reward program. Offering incentives to patients for reaching health goals has the potential to foster a stronger partnership between doctors and patients and improve health outcomes.     

The long-term health and economic benefits of DOTS implementation in Ecuador

BACKGROUND: Between April 2001 and March 2004, the Directly Observed Therapy-Short course (DOTS) program was successfully implemented by the National Tuberculosis control program, with assistance from the Canadian Lung Association, in three provinces of Ecuador, where 52% of the population of the country reside. METHODS: Markov modelling was used to project TB-related morbidity, mortality and costs if the former TB control program (status quo) had continued or if the newly expanded DOTS program is maintained over 20 years. Extensive sensitivity analyses were used to determine the effect on projected outcomes of varying key assumptions. RESULTS: If DOTS is maintained over the next 20 years, we predict that 18,760 cases and 15,812 TB-related deaths will be prevented, resulting in societal savings of dollars 203 million and government savings of dollars 7.1 million (all costs in dollars US). These findings were robust in extensive sensitivity analyses. Given the initial investment of dollars 3 million for DOTS implementation, this would mean a cost of dollars 190 per life saved. CONCLUSIONS: Implementation of DOTS could yield very substantial public health and economic benefits for Ecuador. These results demonstrate the benefits from Canadian government support for DOTS implementation in low- and middle-income countries.     

Financial impact of population health management programs: reevaluating the literature

Although many employers offer some components of worksite-based population health management (PHM), most do not yet invest in comprehensive programs. This hesitation to invest in comprehensive programs may be attributed to numerous factors, such as other more pressing business priorities, reluctance to intervene in the personal health choices of employees, or insufficient funds for employee health. Many decision makers also remain skeptical about whether investment in comprehensive programs will produce a financial return on investment (ROI). Most peer-reviewed studies assessing the financial impact of PHM were published before 2000 and include a broad array of program and study designs. Many of these studies have also included indirect productivity savings in their assessment of financial outcomes. In contrast, this review includes only peer-reviewed studies of the direct health care cost impact of comprehensive PHM programs that meet rigorous methodological criteria. A systematic search of health sciences databases identified only 5 studies with program designs and study methods meeting these selection criteria published after 2007. This focused review found that comprehensive PHM programs can yield a positive ROI based on their impact on direct health care costs, but the level of ROI achieved was lower than that reported by literature reviews with less focused and restrictive qualifying criteria. To yield substantial short-term health care cost savings, the longer term financial return that can credibly be associated with a comprehensive, prevention-oriented population health program must be augmented by other financial impact strategies.     

The measurement of performance in a physical therapy clinical program. A ROI approach

This research presents the development and implementation of a measurement model that yields the return on investment (ROI) in a physical therapy clinical program. A performance measurement model was constructed, which determined the ROI of a clinical program in physical therapy using revenue, patient outcomes, staff productivity, costs, and patient satisfaction. Implementation used archival data for 2 groups of patients in a back and neck rehabilitation program. An expert panel was formed to review the model. Based on the results, ROI provided a more comprehensive tool to measure performance than traditional evaluation measures. ROI appears beneficial, making it a useful tool for health care professionals to measure the performance of PT clinical programs.     

A return on investment evaluation of the Citibank, N.A., health management program

OBJECTIVES: Citibank, N.A., initiated a comprehensive health, demand, and disease management program in 1994, using program services offered by Healthtrac, Inc., of Menlo Park, California. Program components included an initial screening of employees, computerized triage of subjects into higher and lower risk intervention programs, extensive follow-up with the higher risk subjects, and general health education and awareness building. The objective of this study was to estimate the financial impact of this program on medical expenditures. METHODS: A quasiexperimental design was applied comparing medical expenditures before vs. after the intervention for program participants and nonparticipants. The 22,838 subjects (11,194 program participants and 11,644 nonparticipants) were followed for an average of 38 months before and after administration of a Healthtrac health risk appraisal (HRA) instrument that triggered the start of the program. To adjust for selection bias to the extent possible with these data, multiple regression models were used to estimate the savings in medical expenditures associated with program participation. The resulting dollar savings were compared to program costs to estimate the economic return on the company's investment in the program. RESULTS: The return on investment (ROI) was estimated to be between $4.56 and $4.73 saved per dollar spent on the program, depending on the discount rate applied. These results are similar to published evaluations of Healthtrac programs implemented with other populations. CONCLUSIONS: Despite limitations inherent in any retrospective observational study, the strong, positive ROI shown here suggests that a well-designed health management program (HMP), which focuses interventions on high risk populations, can result in monetary savings to an organization.     

Cost of an informatics-based diabetes management program

OBJECTIVES: The relatively high cost of information technology systems may be a barrier to hospitals thinking of adopting this technology. The experiences of early adopters may facilitate decision making for hospitals less able to risk their limited resources. This study identifies the costs to design, develop, implement, and operate an innovative informatics-based registry and disease management system (POPMAN) to manage type 2 diabetes in a primary care setting. METHODS: The various cost components of POPMAN were systematically identified and collected.Results: POPMAN cost 450,000 dollars to develop and operate over 3.5 years (1999-2003). Approximately 250,000 dollars of these costs are one-time expenditures or sunk costs. Annual operating costs are expected to range from 90,000 dollars to 110,000 dollars translating to approximately 90 dollars per patient for a 1,200 patient registry. CONCLUSIONS: The cost of POPMAN is comparable to the costs of other quality-improving interventions for patients with diabetes. Modifications to POPMAN for adaptation to other chronic diseases or to interface with new electronic medical record systems will require additional investment but should not be as high as initial development costs. POPMAN provides a means of tracking progress against negotiated quality targets, allowing hospitals to negotiate pay for performance incentives with insurers that may exceed the annual operating cost of POPMAN. As a result, the quality of care of patients with diabetes through use of POPMAN could be improved at a minimal net cost to hospitals.     

Implementation and outcomes of commercial disease management programs in the United States: the disease management outcomes consolidation survey.

Despite widespread adoption of disease management (DM) programs by US health plans, gaps remain in the evidence for their benefit. The Disease Management Outcomes Consolidation Survey was designed to gather data on DM programs for commercial health plans, to assess program success and DM effectiveness. The questionnaire was mailed to 292 appropriate health plan contacts; 26 plans covering more than 14 million commercial members completed and returned the survey. Respondents reported that DM plays a significant and increasing role in their organizations. Key reasons for adopting DM were improving clinical outcomes, reducing medical costs and utilization, and improving member satisfaction. More respondents were highly satisfied with clinical results than with utilization or cost outcomes of their programs (46%, 17%, and 13%, respectively). Detailed results were analyzed for 57 DM programs with over 230,000 enrollees. Most responding plans offered DM programs for diabetes and asthma, with return on investment (ROI) ranging from 0.16:1 to 4:1. Weighted by number of enrollees per DM program, average ROI was 2.56:1 for asthma (n = 1,136 enrollees) and 1.98:1 for diabetes (n = 25,364). Most (but not all) respondents reported reduced hospital admissions, increasing rates of preventive care, and improved clinical measures. Few respondents provided detailed information about DM programs for other medical conditions, but most that did reported positive outcomes. Lack of standardized methodology was identified as a major barrier to in-house program evaluation. Although low response rate precluded drawing many general conclusions, a clear need emerged for more rigorous evaluation methods and greater standardization of outcomes measurement.     

Implementing Six Sigma in The Netherlands

BACKGROUND: Six Sigma, a process-focused strategy and methodology for business improvement, can be used to improve care processes, eliminate waste, reduce costs, and enhance patient satisfaction. EXPERIENCE WITH SIX SIGMA IN THE NETHERLANDS: Six Sigma was introduced in 2001 at the 384-bed Red Cross Hospital (Beverwijk). During the Green Belt training, every participant was required to participate in at least one Six Sigma project. The hospital's total savings in 2004 amounted to 1.4 million dollars, for an average savings of 67,000 dollars for each of the completed 21 projects. THREE EXAMPLES OF SUCCESSFUL PROJECTS: In one project, the team designed a new admission process for the operating rooms, resulting in an average starting time nine minutes earlier. This relatively minor improvement made it possible to operate on an additional 400 patients a year and to achieve a net savings of >273,000 dollars. A second project reduced the number of patients receiving intravenous (IV) antibiotics by switching to oral administration, yielding annual savings, based on medication costs alone, of >75,000 dollars. A third project reduced the length of stay in the delivery room from 11.9 to 3.4 hours, yielding an annual savings of 68,000 dollars. The "Ultimate Cure?": Six Sigma, which entails involvement of health care workers; use of improvement tools (from industry); creation of trained project teams to tackle complex, often cross-departmental processes; data analyses; and investment in quality improvement may prove the "ultimate cure" to the current cost, quality, and safety issues that challenge health care.     

Benefits and costs of immunization of children with pneumococcal conjugate vaccine in Canada

To estimate cost-effectiveness of routine and catch-up vaccination of Canadian children with seven-valent pneumococcal conjugate vaccine, a simulation model was constructed. In base scenario (vaccination coverage: 80%, and vaccine price: 58 dollars per dose), pneumococcal disease incidence reduction would be superior to 60% for invasive infections, and to 30% for non-invasive infections, but the number of deaths prevented would be small. Annual costs of routine immunization would be 71 million dollars (98% borne by the health system). Societal benefit to cost ratio would be 0.57. Net societal costs per averted pneumococcal disease would be 389 dollars and 125,000 per life-year gained (LYG). Vaccine purchase cost is the most important variable in sensitivity analyses, and program costs would be superior to societal benefits in all likely scenarios. Vaccination would result in net savings for society, if vaccine cost is less than 30 dollars per dose. Economic indicators of catch-up programs are less favorable than for routine infant immunization.     

Costs of implementing and maintaining a tuberculin skin test program in hospitals and health departments.

OBJECTIVE: To determine (1) the annual costs of implementing and maintaining tuberculin skin test (TST) programs at participating study sites, (2) the cost of the TST program per healthcare worker (HCW), and (3) the outcomes of the TST programs, including the proportion of HCWs with a documented TST conversion and the proportion who accepted and completed treatment for latent TB infection, before and after the implementation of staffTRAK-TB software (Centers for Disease Control and Prevention, Atlanta, GA). DESIGN: Cost analysis in which costs for salaries, training, supplies, radiography, and data analysis were collected for two 12-month periods (before and after the implementation of staffTRAK-TB). SETTING: Four hospitals (two university and two city) and two health departments (one small county and one big city). RESULTS: The annual cost of implementing and maintaining a TST program ranged from dollars 66,564 to dollars 332,728 for hospitals and dollars 92,886 to dollars 291,248 for health departments. The cost of the TST program per HCW ranged from dollars 41 to dollars 362 for hospitals and dollars 176 to dollars 264 for health departments. CONCLUSIONS: Costs associated with implementing and maintaining a TST program varied widely among the participating study sites, both before and after the implementation of staffTRAK-TB. Compliance with the TB infection control guidelines of the Centers for Disease Control and Prevention may require a substantial investment in personnel time, effort, and commitment.     

Cost–Benefit Analysis of Preventing Nosocomial Bloodstream Infections among Hemodialysis Patients in Canada in 2004

Objectives:  Hemodialysis-associated bloodstream infection (BSI) is a significant public health problem because the number of hemodialysis patients in Canada had doubled from 1996 to 2005.Our study aimed to determine the costs of nosocomial BSIs in Canada and estimate the investment expenses for establishing infection control programs in general hospitals and conduct cost–benefit analysis.
Materials and Methods:  The data from the Canadian Nosocomial Infection Surveillance Program was used to estimate the incidence rate of nosocomial BSI. We used Canadian Institute of Health Information data to estimate the extra costs of BSIs per stay across Canada in 2004. The cost of establishing and maintaining an infection control program in 1985 was estimated by the US Centers for Disease Control and Prevention and converted into 2004 Canadian costs. The possible 20% to 30% reduction of total nosocomial BSIs was hypothesized.
Results:  A total of 2524 hemodialysis-associated BSIs were projected among 15,278 hemodialysis patients in Canada in 2004. The total annual costs to treat BSIs were estimated to be CDN$49.01 million. Total investment costs in prevention and human resources were CDN$8.15 million. The savings of avoidable medical costs after establishing infection control programs were CDN$14.52 million. The benefit/cost ratio was 1.0 to 1.8:1.
Conclusion:  Our study provides evidence that the economic benefit from implementing infection control programs could be expected to be well in excess of additional cost postinfection if the reduction of BSI can be reduced by 20% to 30%. Infection control offered double benefits: saving money while simultaneously improving the quality of care.     

A benefit-cost analysis of a worksite nurse practitioner program: first impressions

OBJECTIVE: This study aimed to assess the initial impact of an on-site nurse practitioner (NP) initiative on the health care costs (HCC) among 4,284 employees and their dependents. METHODS: The authors analyzed HCC by two methods. First, they compared annualized actual values for the first 6 months of the startup year (2004) with those projected for 2004 on the basis of claims paid in 2002 and 2003. Both aggregate and per-individual HCC were used as the basis for comparison. The difference in HCC between projected and observed values for 2004 was defined as the benefit of the NP program. In a second analysis, HCC were calculated using 2003 paid claims for major diagnostic categories (MDC). These HCC were compared with those that would have been incurred had off-site care been used for the (annualized) number of such patients cared for by the NP in 2004 with the same MDC. The cost of the NP program was used as the denominator in calculating the benefit-to-cost ratio using the savings in HCC estimated by the two previously mentioned methods. RESULTS: Annualized cost of the NP program was 82,716 dollars. Savings in HCC using the first method were 1,313,756 dollars per year, yielding a benefit-to-cost ratio of 15 to 1. Using the MDC analysis, the ratio was 2.4 to 1. This difference in ratios between the two estimates may partly be attributable to effects of other initiatives such as the wellness program and the Nurse Health Line. The latter was begun 10 weeks before the NP program, is available at all times, and is intended to minimize the need for workers and families to seek high-cost care at hospital emergency departments. CONCLUSIONS: The first 6 months of a new NP initiative yielded substantial reductions in HCC that warrant further analysis over longer periods of observation. However, the initial estimates may understate the aggregate value of the program because it may also reduce on-site injury and illness patterns and improve productivity, end points that were not assessed in this initial snapshot.     

Use of chromium picolinate and biotin in the management of type 2 diabetes: an economic analysis.

This paper addresses the potential economic benefits of chromium picolinate plus biotin (Diachrome) use in people with Type 2 diabetes (T2DM). The economic model was developed to estimate the impact on health care systems' costs by improved HbA1C levels with chromium picolinate plus biotin (Diachrome). Lifetimes cost savings were estimated by adjusting a benchmark from the literature, using a price index to adjust for inflation. The cost of diabetes is highly dependent on the HbA1C level with higher initial levels and higher annual increments increasing the cost. Improvement in glycemic control has proven to be cost-effective in delaying the onset and progression of T2DM, reducing the risk for diabetes-associated complications and lowering utilization and cost of care. Chromium picolinate plus biotin (Diachrome) showed greater improvement of glycemic control in poorly controlled T2DM patients (HbA(1C) > or = 10%) compared to their better controlled counterparts (HbA(1C) < 10%). This improvement was additive to that achieved by oral hypoglycemic medications and correlates to calculated levels of cost savings. Average 3-year cost savings for chromium picolinate plus biotin (Diachrome) use could range from 1,636 dollars for a poorly controlled patient with diabetes without heart diseases or hypertension, to 5,435 dollars for a poorly controlled patient with diabetes, heart disease, and hypertension. Average 3-year cost savings was estimated to be between 3.9 billion dollars and 52.9 billion dollars for the 16.3 million existing patients with diabetes. Chromium picolinate plus biotin (Diachrome) use among the 1.17 million newly diagnosed patients with T2DM each year could deliver lifetime cost savings of 42 billion dollars, or 36,000 dollars per T2DM patient. Affordable, safe, and convenient, chromium picolinate plus biotin (Diachrome) could prove to be a cost-effective complement to existing pharmacological therapies for controlling T2DM.     

Cost-benefit Analysis of the Coping and Promoting Strength Program

This study sought to estimate the net benefits and return on investment (ROI, %) of the Coping and Promoting Strength (CAPS) program to families and insurers, respectively, using data from a multi-year follow up of 136 US families who had participated in a randomized efficacy trial of CAPS. CAPS is a brief parent-focused psychosocial intervention that was compared to information monitoring in the trial. Of the 136 original participants, 113 (83%) completed follow-up interviews 7.1 years, on average, after the CAPS study baseline (mean follow-up age: 15.8 years; range: 13.1 to 20.8 years). Parent-reported willingness-to-pay values and estimates of behavioral healthcare cost savings from delayed onset of anxiety were used to simulate the average net benefits of CAPS to families and insurance plans, respectively, assuming patients pay 20% coinsurance. Psychologists in private offices were expected to charge an average of approximately $195 per CAPS session or $1417 in total in 2020 dollars. The estimated family share of the total CAPS session cost was $283 per youth, while the insurer share was $1134 per youth. Given these costs, the CAPS intervention was estimated to result in average overall net benefits of $1033 per youth (95% CI: -$546 to $2611). Families gained $344 (95% CI: $232 to $455 per family) for an ROI of 121%. Insurance plans on average gained a net savings of $689 per youth (95% CI: -$778 to $2156 per youth) for an average ROI of 61%. In this multiyear follow-up of offspring of anxious parents, exposure to the CAPS pediatric anxiety prevention program was found to be more economically efficient than was waiting for an anxiety disorder to be diagnosed. ClinicalTrials.gov Identifier: NCT00847561.

     

Cost-effectiveness of hospital vaccination programs in North Carolina

Although influenza and pneumonia are largely vaccine-preventable, vaccination coverage rates are well below Healthy People 2010 goals. The aim of this study was to examine the costs and cost-effectiveness of three provider-based vaccination interventions in the hospital setting: standing orders programs (SOPs), physician reminders (PRs), and pre-printed orders (PPOs). Data on program operating costs and the numbers of patients who received influenza or pneumococcal vaccinations were collected from nine North Carolina hospitals. Results demonstrated that the additional cost per patient vaccinated in 2004 was US dollars 58 for SOPs, US dollars 90 for PRs, and US dollars 412 for PPOs. These findings suggest that SOPs are a cost-effective approach for increasing adult vaccination coverage rates in hospital settings.     

A nationwide community-based lifestyle program could delay or prevent type 2 diabetes cases and save $5.7 billion in 25 years

The increasing health and economic burden of diabetes has made preventing the disease a public health priority. But investing in such chronic disease prevention programs requires a long-term horizon because many years may be required for the downstream savings to fully offset the up-front intervention cost. Using a simulation model, we projected the costs and benefits of a nationwide community-based lifestyle intervention program for preventing type 2 diabetes. Accounting for all costs to the US health care system, our results indicate that the program would break even in fourteen years. Within twenty-five years, the program would prevent or delay about 885,000 cases of type 2 diabetes in the United States and produce savings of $5.7 billion nationwide. If restricted to people ages 65-84, the program would save $2.4 billion. Thus, implementing such a program nationwide would be an efficient use of health care resources, although it might be necessary for all health insurers to participate to share prevention costs. Our results also indicate that although a prevention program would lead to cost savings in both younger and older people, it would achieve greater health and economic gains if it were directed at people under age sixty-five.     

The estimated costs and savings of medical nutrition therapy: the Medicare population

OBJECTIVES: To measure the potential savings from medical nutrition therapy (MNT) and to estimate the net cost to Medicare of covering these services for Medicare enrollees. This includes developing an estimate of the cost of providing medical nutrition services to the Medicare population and estimating the savings in hospital and other spending resulting from the use of these services. DESIGN: Analysis of longitudinal data from the Group Health Cooperative of Puget Sound (Seattle, Wash) for persons aged 55 years and older who have coverage for MNT services. SUBJECTS/SETTING: Persons aged 55 years and older who had diabetes (n = 12,308), cardiovascular disease (n = 10,895), or renal disease (n = 3,328) and who were covered under the Group Health Cooperative of Puget Sound, including Medicare beneficiaries enrolled in the plan's Medicare risk contract program. Extrapolation to the US Medicare population is based on data for persons served by the Group Health Cooperative of Puget Sound. INTERVENTION: The use of MNT. MAIN OUTCOMES MEASURE: Differences in health care utilization levels of persons with diabetes, cardiovascular disease, and renal disease who do and do not receive MNT. Differences in utilization were estimated for hospital discharges per calendar quarter, physician visits per quarter, and other outpatient visits per quarter. STATISTICAL ANALYSES PERFORMED: Multivariate regression models of changes in utilization for persons after they receive MNT services. RESULTS: Our analysis showed that MNT was associated with a reduction in utilization of hospital services of 9.5% for patients with diabetes and 8.6% for patients with cardiovascular disease. Also, utilization of physician services declined by 23.5% for MNT users with diabetes and 16.9% for MNT users with cardiovascular disease. The net cost of covering MNT under Medicare is estimated to be $369.7 million over the 1998 through 2004 period. The total cost of benefits is estimated to be $2.7 billion over this period. This would be partially offset by estimated savings of $2.3 billion resulting in net costs of $369.7 million. The program would actually yield net savings after the third year of the program, which would continue through 2004 and beyond. CONCLUSION: After an initial period of implementation, coverage for MNT can result in a net reduction in health services utilization and costs for at least some populations. In the case of persons aged 55 years and older, the savings in utilization of hospital and other services will actually exceed the cost of providing the MNT benefit. These results suggest that Medicare coverage of MNT has the potential to pay for itself with savings in utilization for other services.     

Measuring Quality in Pay-for-Performance Programs

‘Pay for performance’ is a strategy to improve the quality of healthcare by rewarding physicians who deliver higher-quality service. Pay for performance appears to be a simple and logical solution to address both healthcare quality and cost problems. However, pay for performance in action is often neither simple nor logical. Pay-for-performance programs grade and reward physicians based on whether their patients receive particular healthcare services and achieve certain treatment goals.We illustrate pay for performance in action by applying a common set of performance measures, physician scoring, and earned incentives to two patient cases. Using ‘one-size-fits-all’ treatment goals to award incentives, pay-for-performance programs may not detect, and thus may discourage, evidence-based care provided to patients with complex medical and social co-morbidities. Targeting and rewarding ideal treatment goals in a patient with complex needs who may never reach incentive-achieving treatment goals may encourage providers to focus on health status improvements that are significantly less than those obtained by complication-risk-reducing care. Applying evidence from the track records of pay-for-performance programs to date, we recommend performance measures and data collection methods to reliably assess physician and healthcare organization behavior, and to avoid provider penalty for non-modifiable patient characteristics of disease severity and self-management capacity. We recommend scoring healthcare quality based on individualized patient risk reduction rather than one-size-fits-all treatment goals, using calculated risk assessments when possible. Performance measures should also be prioritized in scoring to give more weight to measures with stronger evidence to influence risk reduction (e.g. blood pressure control has a stronger impact on reducing cardiovascular events than the influence of glucose control). By re-focusing pay for performance on quality improvement through risk reduction, we aim to prevent patients with complex healthcare needs from becoming financial liabilities to the physician.     

Return on investment in disease management: a review

The results of 44 studies investigating financial impact and return on investment (ROI) from disease management (DM) programs for asthma, congestive heart failure (CHF), diabetes, depression, and multiple illnesses were examined. A positive ROI was found for programs directed at CHF and multiple disease conditions. Some evidence suggests that diabetes programs may save more than they cost, but additional studies are needed. Results are mixed for asthma management programs. Depression management programs cost more than they save in medical expenses, but may save money when considering productivity outcomes.     

Comparing Cost-of-Illness Estimates from Alternative Approaches: An Application to Diabetes

Objective. To compare disease cost estimates from two commonly used approaches.
Data Source. Pooled Medical Expenditure Panel Survey (MEPS) data for 1998–2003.
Study Design. We compared regression-based (RB) and attributable fraction (AF) approaches for estimating disease-attributable costs with an application to diabetes. The RB approach used results from econometric models of disease costs, while the AF approach used epidemiologic formulas for diabetes-attributable fractions combined with the total costs for seven conditions that result from diabetes.
Data Extraction. We used SAS version 9.1 to create a dataset that combined data from six consecutive years of MEPS.
Principal Findings. The RB approach produced higher estimates of diabetes-attributable medical spending ($52.9 billion in 2004 dollars) than the AF approach ($37.1 billion in 2004 dollars). RB model estimates may in part be higher because of the challenges of implementing the two approaches in a similar manner, but may also be higher because they capture the costs of increased treatment intensity for those with the disease.
Conclusions. We recommend using the RB approach for estimating disease costs whenever individual-level data on health care spending are available and when the presence of the disease affects treatment costs for other conditions, as in the case of diabetes.