HERC: Bulletin
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HERC Bulletin - June 2017

Cost-Effectiveness of Triple Therapy versus Biologic Therapy for Active Rheumatoid Arthritis

The wide use of biologic therapies for Rheumatoid Arthritis (RA) has led to large increases in drug spending; yet, the cost-effectiveness of biologic therapies versus a combination of conventional disease-modifying antirheumatic drugs (triple therapy) is unknown. New research by a joint team of VA and Canadian investigators examines the cost-effectiveness of implementing triple therapy before biologic therapy for patients with RA. In this study, published in Annals of Internal Medicine, Nick Bansback, PhD, Ciaran S. Phibbs, PhD, Huiying Sun, PhD, et al, analyzed the value of the two treatment regimens as a first-line therapy for RA by evaluating the incremental costs, quality-adjusted life years (QALYs), and incremental cost-effectiveness ratios (ICERs).

The authors found that prescribing biologic therapy as a first line treatment significantly increases costs while providing minimal incremental benefit. Biologic therapy as a first line treatment incurs approximately $78,000 more per patient, over the patient’s lifetime, than triple therapy. First line treatment of biologic therapy results in a modest gain of 0.15 QALY per patient.

1.3 million Americans suffer from RA (https://www.rheumatology.org/Learning-Center/Statistics). Given the current low use of triple therapy, implementing triple therapy as a first line treatment for patients with RA has the potential to save millions of dollars in health care expenditures.

This study was funded through the Cooperative Studies Program (CSP 551). More details can be found in the full publication. Barnsback N, Phibbs CS, Sun H, et al. Triple Therapy Versus Biologic Therapy for Active Rheumatoid Arthritis. Ann Intern Med. 2017 May 30. doi: 10.7326/M16-0713. [Epub ahead of print].

Should the VA make or buy health services?

Join HERC on June 21, 2017 at 11:00am Pacific /2:00pm Eastern for the cyberseminar “Comparison of Quality, Cost, and Accessibility of Elective Coronary Revascularization Provided by Veterans Health Administration and Community Care Hospitals.” HERC economist Paul Barnett will compare VHA care to services provided by community hospitals under contract to VHA by examining the trade-offs between quality, costs, and accessibility of elective cardiac revascularization.

Register for the seminar: http://www.hsrd.research.va.gov/cyberseminars/catalog-upcoming-series.cfm?seriessort=hmcs

VHA Data Available for Public Use

Basic fact about services of the Veterans Health Administration is available from public information portals.

The easily accessed sources provide basic information about the cost, volume of care, and number of patients served by VHA. For example, they report that VHA provided care to 5.9 million veterans in the 2015 federal fiscal year, at a cost of $65.6 billion. Types of care are also described: VHA provided 92.4 million outpatient visits, and 707.4 thousand hospital admissions in the 2014 federal fiscal year, when 9.1 million veterans were enrolled to receive VHA care.

The public portal with information about VA services is: https://www.va.gov/vetdata/

There are a number of databases described in the VA open data portal:https://www.va.gov/data/

Not all of the 800 datasets that are described are open for public use.

FY16 HERC Inpatient Average Cost Data Now Available

HERC inpatient average cost data for the 2016 Fiscal Year is now available at VINCI. These data include the estimated cost of every VA inpatient stay reported in the VA Patient Treatment File (PTF). HERC average cost data use information from non-VA sources to estimate the relative cost of each health care encounter. There are three HERC inpatient average cost files: medical-surgical, non-medical surgical, and discharge.

Learn more »

Labor Cost data updated for FY15 and FY16

HERC’s labor cost dataset has been updated for Fiscal Year 2015 and 2016. Estimates of labor cost are needed for economic evaluations, including cost-effectiveness analysis, budget impact analysis, evaluations of efficiency, and in considerations of the relative advantage of making or purchasing a service. There are two sources of labor costs at the Veterans Health Administration: the Financial Management System (FMS) and the Managerial Cost Accounting System Account Level Budgeter Cost Center (ALBCC). HERC has created a dataset with the total labor costs, workload (hours), and hourly labor costs for each data source, by Budget Object Code and fiscal year.

The labor cost dataset and corresponding guidebook are available on the HERC website (intranet only).

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Medicare Wage Index for VA Facilities Updated

HERC has combined data from the Centers for Medicare and Medicaid Services (CMS) and the VHA Support Services Center (VSSC) to create a Medicare wage index for VA facilities.The Medicare wage index is a tool researchers can use to adjust their cost calculations for wage differences across the country. The guidebook and accompanying Excel have been updated through 2017.

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Resources on the Economics of Implementation

Resources and tools for conducting economic analyses for implementation projects are available on the new HERC web page “Economics of Implementation.” This web page introduces the Quality Enhancement Research Initiative (QUERI), and outlines how HERC supports QUERI economic analyses. Readers can learn more about the steps to conducting economic analyses for implementation projects and find resources on the economics of implementation.

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HERC Staff Update

HERC Director Todd Wagner has received an HSR&D Research Career Scientist (RCS) award. Dr. Wagner’s three year RCS research plan focuses on health information, value and efficiency, and access.  Through these aims Dr. Wagner and team will identify high value care and create incentives that reward the delivery of high value care.