Budget
Impact
Analysis
Mairin Ryan
Director of Health
Technology
Assessment
Budget Impact Analysis
Science
Patient
wishes
Industry
claims
Decision
making
“HTA is a decision support tool”
Multidisciplinary process, summarises information about
– Safety
– Clinical and cost-effectiveness
– Budget impact
– Organisational impact / resource implications
– Social and ethical issues
related to use of a health technology in a systematic, transparent,
unbiased and robust manner
Budget Impact Analysis
• Tool to predict the financial impact of the
adoption and diffusion of a new
technology into a healthcare system with
fixed resources
• Addresses affordability
• Analysis of the added financial impact of a
new health technology for a finite period
of time
Health Technologies
Any intervention used to promote health,
diagnose or treat disease, or used in
rehabilitation or long-term care, e.g.
Drugs
Medical devices
Diagnostics
Surgical procedures
Organisational &
support systems
Why conduct BIA?
• Required to make an informed
reimbursement decision
– New technology may have increased
acquisition costs
– New technology may have cost-offsets e.g.
Adverse effects, inpatient days
– New technology may have different impact on
different cost centres e.g. drug costs,
laboratory costs, staff costs,
Issues to consider in BIA
•
•
•
•
•
Perspective
Technology
Comparator
Timeframe
Target population
•
•
•
•
•
Costing
Outcomes
BIA Model
Uncertainty
Reporting
Perspective
• Perspective: viewpoint from which study is
conducted e.g. payer, health sub-budget,
society
– Payer perspective considers costs falling on
health (and social) care system only
– Only costs falling on e.g. drugs budget
– Societal perspective considers other costs e.g.
Cost of accessing healthcare, Lost productivity
due to accessing healthcare or ill health,
unemployment benefits, income taxation
Technology
• Sufficient information to differentiate from
comparators
– Treatment indication
– How it will be used,
– What benefits it will deliver,
– What else is needed to enable use e.g.
healthcare staff, training requirements,
adjunctive interventions, healthcare setting,
capital investment
Comparator
• Preferred comparator is “routine care”
– Technology most commonly used for that
indication in your healthcare setting
– More than one comparator (weighted
average)
– Comparator may include technology without
marketing authorisation for that indication
(must have efficacy and safety evidence)
– No intervention may be appropriate choice
Timeframe
• Represents the time horizon over which
resource use will be planned e.g. 5 years
– Time to “steady state” depends on rate of
diffusion or uptake of the technology
– Slow diffusion may be due to capacity issues,
learning curves
– Long time to peak effect with chronic
diseases, screening programmes, vaccinations
etc.
– Need to consider technological issues e.g.
battery replacement etc.
Target population
• Individuals with a given condition who might
avail of the technology within the time horizon
– Epidemiology to inform reporting of prevalence,
incidence, mortality (open cohort)
– Report absolute size of target population
– Estimate uptake based on proportion suitable for
intervention, adherence and persistence data,
market analysis, expert opinion
– Report frequency of healthcare use e.g. episodes
of care
– Subgroups
Costing
• Costs included depend on perspective
– Direct medical costs
– Indirect medical costs
– Indirect non-medical costs
• Three steps to estimate cost
– Identify resource use that may change
– Quantify extent of changes
– Measure costs of changes
Resource use
• Costs directly associated with intervention
plus adjunctive interventions e.g.
concomitant meds, adverse events,
administration costs (staff, setting),
• Cost offsets include reduced adjunctive
interventions, reduced healthcare
consumption
• Costs not directly related to intervention
excluded e.g. other healthcare costs due
to extension of life
Quantify resource use changes
• Depict treatment sequence / clinical care
pathway
• Trial & observational data
• Expert opinion
Costs
– Unit cost databases, administrative databases,
microcosting analyses focussing on changes in
resource use
– Unit cost inflation (consumer price index)
– Costs from other country (purchasing power
parity)
– Capital costs e.g. equipment, ICT,
accommodation, maintenance (depreciation)
– Staff costs e.g. mid point of scale, include
administrative and pension overheads
Clinical outcomes
• Relevant outcomes are those which
influence use of technology (effectiveness,
safety, uptake, etc) and need for further
treatment ( e.g. implantable device failure
requiring further surgery)
– Effectiveness: RCT data, meta-analysis,
observational data
– Safety: RCT, patient registries. All AEs of
economic significance included e.g.
Hospitalisation, impact on adherence,
persistence etc.
Why clinical outcomes?
• Need to determine use of technology and
any cost offsets
• Provide data for planning resource use
e.g. Reduced bed days
• Data on benefits to justify budget
increases
BIA model
• Structure of model described
• All assumptions in model stated and
sources acknowledged
• Validation described
• Model Baseline Scenario and New
Technology Scenario
• Static model
• Dynamic model e.g. adjusted Costeffectiveness model (population size, VAT,
discount rate)
Budget Impact Analysis
What is the difference between BIA and economic evaluation?
Parameter
BIA
Economic evaluation
Underlying concept
Affordability
Value for money
Purpose
Financial impact of
introducing a technology
Efficiency of alternative
technologies
Study timeframe
Usually short-term (1 to 5
years)
Usually long-term (e.g.
lifetime)
Health outcomes
Excluded
Quality adjusted life years
Discounting
No
4%
Result
Total and incremental
annual costs
Incremental cost per unit of
health outcome achieved
Uncertainty
• Scenario analysis to evaluate plausible
scenarios
• Sensitivity analysis to evaluate uncertainty
in budget estimates due to uncertainty in
model and in key parameters
Uncertainty (ctd)
• Parameters to be examined: population
size, uptake, costs (intervention and
offsets)
• Univariate sensitivity analysis
• Multivariate sensitivity analysis
• Probabilistic sensitivity analysis
Reporting
• Report resource use for each year in
natural units
• Disaggregated costs each year
• Report total and incremental costs for
each year
• Report disaggregated by subgroup if
appropriate
• Report scenario and sensitivity analysis
including range for each parameter
Reporting Budget Impact
B
Comparator /
routine practice
Choice
A
Intervention
Compares Robotic Hysterectomy versus mix of
Laparoscopic plus Open Hysterectomy
Year
Costs A
Costs B
• Incremental budget impact: Costs A – Costs B
Incremental budget
impact
1
Median
€0.49m
(95% CI)
(0.39 – 0.61)
2
€0.81m
(0.69 – 0.95)
3
€0.95m
(0.82 – 1.11)
4
€1.08m
(0.92 – 1.26)
5
€1.15m
(0.93 – 1.40)
Total
€4.48m
(3.95 – 5.14)
Univariate sensitivity analysis for
incremental budget impact of robotic
hysterectomy
Volume of operations
Operative time
Equipment
Robot lifespan
Length of stay
Per diem
Robot maintenance
3.75
4.00
4.25
4.50
4.75
Five year budget impact (€m)
5.00
5.25
Budget impact of National Deep
Brain Stimulation Programme
Year
1
2
3
4
5
Irish service
(€m)
Current service
(€m)
Difference
(€m)
Cumulative
difference(€m)
1.21 (0.93-1.67)
0.85 (0.62-1.20)
0.37 (0.07-0.71)
0.37 (0.07-0.71)
1.22 (0.93-1.68)
0.85 (0.62-1.21)
0.37 (0.07-0.72)
0.73 (0.13-1.41)
1.23 (0.93-1.70)
0.86 (0.63-1.23)
0.37 (0.07-0.72)
1.10 (0.20-2.13)
1.23 (0.93-1.72)
0.86 (0.62-1.24)
0.37 (0.06-0.72)
1.47 (0.26-2.85)
1.24 (0.93-1.74)
0.87 (0.62-1.25)
0.37 (0.06-0.73)
1.84 (0.32-3.55)
Increased resource requirements
by year for selected resources
Resource
Year
1
2
3
4
5
Consultant neurosurgeon (hrs)
334
344
352
355
365
Consultant neurologist (hrs)
218
214
211
210
206
Specialist nurse (hrs)
270
274
277
278
281
Theatre time (hrs)
111
112
112
113
113
Surgical bed days
225
226
227
228
228
Outpatient appointments
74
78
81
82
86
CT scans
30
31
31
31
31
MRI scans
35
35
35
35
35
Contribution of cost elements to cost per
patient in the proposed Irish service
2.6%
21.0%
Staff
1.2%
Anaesthetic
Per diem
Operative cost
13.0%
62.2%
Imaging
Contribution of each procedure to
the budget impact
Initial assessment (PD)
Initial assessment (ET & dystonia)
Proposed Irish
service
Device implantation
Device removal
Battery replacement
Device programming
Current service
Interim review
Major review (PD)
0
1
2
3
4
Cost (€ million)
5
6
Major review (ET/dystonia)
Conclusions
• Budget impact analysis is important for
reimbursement decisions
• Data used in CEA and BIA models
• Necessary to report total and incremental
budget impact
• Standardised approach allows meaningful
comparisons
• Methods used should be clearly explained
and sufficient data provided to allow
validation
References
• Guidelines for the Budget Impact Analysis of
Health Technologies in Ireland 2013.
www.hiqa.ie
• Budget impact analysis – Principles of Good
Practice: Report of the ISPOR 2012 Budget
Impact Analysis Good Practice II Task Force
www.ispor.org
• Health Technology Assessment of robot-assisted
surgery in Ireland. HIQA 2011. www.hiqa.ie
• Health Technology Assessment of a Deep Brain
Stimulation Service in Ireland. HIQA 2012.
www.hiqa.ie
Thank you
mryan@hiqa.ie