The impact of including future medical care costs when estimating the costs attributable to a disease: A colorectal cancer case study

Ruth Etzioni, Scott D. Ramsey, Kristin Berry, Martin Brown

Research output: Contribution to journalArticle

36 Scopus citations

Abstract

A source of controversy in the economic literature concerns whether to include or exclude future medical care costs when computing attributable costs for lifesaving interventions. Although it is hypothesized that including future medical care costs will offset the cost savings achieved through prevention, the magnitude of the effect is not known. The objectives of the present study are to develop a methodology for estimating the excess costs of care among colorectal cancer patients, including and excluding future costs of care, and comparing these results with previous studies that do not include costs in added years of life. Subjects in the study included those identified with colorectal cancer drawn from the Surveillance, Epidemiology and End Results (SEER) - Medicare database and an age- and gender-matched control group drawn from the general Medicare population. Using the Kaplan-Meier Sample Average estimator, we directly estimate expected 11-year costs, and then, with the addition of some simple extrapolating assumptions, determine expected 25-year costs. The latter time horizon captures lifetime costs for over 90% of the cohort. Males results for discounted, stage-specific 11-versus 25-year excess costs: in situ, $22411 versus $23494; Stage 1, $29365 versus $32510; Stage 2, $28114 versus $25263; Stage 3, $27397 versus $19647; Stage 4, $3006 versus $7837. Trends were similar for females. It can be concluded that adding costs of care in future years for those whose colorectal cancer is prevented owing to screening greatly alters the estimate of lifetime excess costs for colorectal cancer patients, and can produce negative results for advanced stage disease. The results emphasize the need to adopt a standard approach for dealing with future costs when evaluating lifesaving interventions for cost-effectiveness analyses.

Original languageEnglish (US)
Pages (from-to)245-256
Number of pages12
JournalHealth Economics
Volume10
Issue number3
DOIs
Publication statusPublished - May 14 2001
Externally publishedYes

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Keywords

  • Cost-effectiveness analysis
  • Future medical care costs
  • Survival

ASJC Scopus subject areas

  • Health Policy

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