Paul Mitchell’s journal round-up for 17th July 2017

Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot. If you’d like to write one of our weekly journal round-ups, get in touch.

What goes wrong with the allocation of domestic and international resources for HIV? Health Economics [PubMedPublished 7th July 2017

Investment in foreign aid is coming under considered scrutiny as a number of leading western economies re-evaluate their role in the world and their obligations to countries with developing economies. Therefore, it is important for those who believe in the benefits of such investments to show that they are being done efficiently. This paper looks at how funding for HIV is distributed both domestically and internationally across countries, using multivariate regression analysis with instruments to control for reverse causality between financing and HIV prevalence, and domestic and international financing. The author is also concerned about countries free riding on international aid and estimates how countries ought to be allocating national resources to HIV using quintile regression to estimate what countries have fiscal space for expanding their current spending domestically. The results of the study show that domestic expenditure relative to GDP per capita is almost unit elastic, whereas it is inelastic with regards to HIV prevalence. Government effectiveness (as defined by the World Bank indices) has a statistically significant effect on domestic expenditure, although it is nonlinear, with gains more likely when moving up from a lower level of government effectiveness. International expenditure is inversely related to GDP per capita and HIV prevalence, and positively with government effectiveness, albeit the regression models for international expenditure had poor explanatory power. Countries with higher GDP per capita tended to dedicate more money towards HIV, however, the author reckons there is \$3bn of fiscal space in countries such as South Africa and Nigeria to contribute more to HIV, freeing up international aid for other countries such as Cameroon, Ghana, Thailand, Pakistan and Columbia. The author is concerned that countries with higher GDP should be able to allocate more to HIV, but feels there are improvements to be made in how international aid is distributed too. Although there is plenty of food for thought in this paper, I was left wondering how this analysis can help in aiding a better allocation of resources. The normative model of what funding for HIV ought to be is from the viewpoint that this is the sole objective of countries of allocating resources, which is clearly contestable (the author even casts doubt as to whether this is true for international funding of HIV). Perhaps the other demands faced by national governments (e.g. funding for other diseases, education etc.) can be better reflected in future research in this area.

Can pay-for-performance to primary care providers stimulate appropriate use of antibiotics? Health Economics [PubMed] [RePEcPublished 7th July 2017

Antibiotic resistance is one of the largest challenges facing global health this century. This study from Sweden looks to see whether pay for performance (P4P) can have a role in the prescription practices of GPs when it comes to treating children with respiratory tract infection. P4P was introduced on a staggered basis across a number of regions in Sweden to incentivise primary care to use narrow spectrum penicillin as a first line treatment, as it is said to have a smaller impact on resistance. Taking advantage of data from the Swedish Prescribed Drug Register between 2006-2013, the authors conducted a difference in difference regression analysis to show the effect P4P had on the share of the incentivised antibiotic. They find a positive main effect of P4P on drug prescribing of 1.1 percentage points, that is also statistically significant. Of interest, the P4P in Sweden under analysis here was not directly linked to salaries of GPs but the health care centre. Although there are a number of limitations with the study that the authors clearly highlight in the discussion, it is a good example of how to make the most of routinely available data. It also highlights that although the share of the less resistant antibiotic went up, the national picture of usage of antibiotics did not reduce in line with a national policy aimed at doing so during the same time period. Even though Sweden is reported to be one of the lower users of antibiotics in Europe, it highlights the need to carefully think through how targets are achieved and where incentives might help in some areas to meet such targets.

Econometric modelling of multiple self-reports of health states: the switch from EQ-5D-3L to EQ-5D-5L in evaluating drug therapies for rheumatoid arthritis. Journal of Health Economics Published 4th July 2017

The EQ-5D is the most frequently used health state descriptive system for the generation of utility values for quality-adjusted life years (QALYs) in economic evaluation. To improve sensitivity and reduce floor and ceiling effects, the EuroQol team developed a five level version (5L) compared to the previous three level (3L) version. This study adds to recent evidence in this area of the unforeseen consequences of making this change to the descriptive system and also the valuation system used for the 5L. Using data from the National Data Bank for Rheumatic Diseases, where both 3L and 5L versions were completed simultaneously alongside other clinical measures, the authors construct a mapping between both versions of EQ-5D, informed by the response levels and the valuation systems that have been developed in the UK for the measures. They also test their mapping estimates on a previous economic evaluation for rheumatoid arthritis treatments. The descriptive results show that although there is a high correlation between both versions, and the 5L version achieves its aim of greater sensitivity, there is a systematic difference in utility scores generated using both versions, with an average 87% of the score of the 3L recorded compared to the 5L. Not only are there differences highlighted between value sets for the 3L and 5L but also the responses to dimensions across measures, where the mobility and pain dimensions do not align as one would expect. The new mapping developed in this paper highlights some of the issues with previous mapping methods used in practice, including the assumption of independence of dimension levels from one another that was used while the new valuation for the 5L was being developed. Although the case study they use to demonstrate the effect of using the different approaches in practice did not result in a different cost-effectiveness result, the study does manage to highlight that the assumption of 3L and 5L versions being substitutes for one another, both in terms of descriptive systems and value sets, does not hold. Although the authors are keen to highlight the benefits of their new mapping that produces a smooth distribution from actual to predicted 5L, decision makers will need to be clear about what descriptive system they now want for the generation of QALYs, given the discrepancies between 3L and 5L versions of EQ-5D, so that consistent results are obtained from economic evaluations.

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Alastair Canaway’s journal round-up for 10th July 2017

Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot. If you’d like to write one of our weekly journal round-ups, get in touch.

Use-of-time and health-related quality of life in 10- to 13-year-old children: not all screen time or physical activity minutes are the same. Quality of life Research [PubMedPublished 3rd July 2017

“If you watch too much TV, it’ll make your eyes square” – something I heard a lot as a child. This first paper explores whether this is true (sort of) by examining associations between aspects of time use and HRQL in children aged 10-13 (disclaimer: I peer reviewed it and was pleased to see them incorporate my views). This paper aims to examine how different types of time use are linked to HRQL. Time use was examined by the Multimedia Activity Recall for Children and Adolescents (MARCA) which separates out time into physical activity (sport, active transport, and play), screen time (TV, videogames, computer use), and sleep. The PedsQL was used to assess HRQL, whilst dual x-ray absorptiometry was used to accurately assess fatness. There were a couple of novel aspects to this study, first, the use of absorptiometry to accurately measure body fat percentage rather than the problematic BMI/skin folds in children; second, separating time out into specific components rather than just treating physical activity or screen time as homogeneous components. The primary findings were that for both genders, fatness (negative), sport (positive) and development stage (negative) were associated with HRQL. For boys, the most important other predictor of HRQL was videogames (negative) whilst predictors for girls included television (negative), active transport (negative) and household income (positive). With the exception of ‘active travel’ for girls, I don’t think any of these findings are particularly surprising. As with all cross-sectional studies of this nature, the authors give caution to the results: inability to demonstrate causality. Despite this, it opens the door for various possibilities for future research, and ideas for shaping future interventions in children this age.

Raise the bar, not the threshold value: meeting patient preferences for palliative and end-of-life care. PharmacoEconomics – Open Published 27th June 2017

Health care ≠ end of life care. Whilst health care seeks to maximise health, can the same be said for end of life care? Probably not. This June saw an editorial elaborating on this issue. Health is an important facet of end of life care. However, there are other substantial objects of value in this context e.g. preferences for place of care, preparedness, reducing family burdens etc. Evidence suggests that people at end of life can value these ‘other’ objects more than health status or life extension. Thus there is value beyond that captured by health. This is an issue for the QALY framework where health and length of life are the sole indicators of benefit. The editorial highlights that this is not people wishing for higher cost-per-QALY thresholds at end of life, instead, it is supporting the valuation of key elements of palliative care within the end of life context. It argues that palliative care interventions often are not amenable to integration with survival time in a QALY framework, this effectively implies that end of life care interventions should be evaluated in a separate framework to health care interventions altogether. The editorial discusses the ICECAP-Supportive Care Measure (designed for economic evaluation of end of life measures) as progress within this research context. An issue with this approach is that it doesn’t address allocative efficiency issues (and comparability) with ‘normal’ health care interventions. However, if end of life care is evaluated separately to regular healthcare, it will lead to better decisions within the EoL context. There is merit to this justification, after all, end of life care is often funded via third parties and arguments could, therefore, be made for adopting a separate framework. This, however, is a contentious area with lots of ongoing interest. For balance, it’s probably worth pointing out Chris’s (he did not ask me to put this in!) book chapter which debates many of these issues, specifically in relation to defining objects of value at end of life and whether the QALY should be altogether abandoned at EoL.

Investigating the relationship between costs and outcomes for English mental health providers: a bi-variate multi-level regression analysis. European Journal of Health Economics [PubMedPublished 24th June 2017

Payment systems that incentivise cost control and quality improvements are increasingly used. In England, until recently, mental health services have been funded via block contracts that do not necessarily incentivise cost control and payment has not been linked to outcomes. The National Tariff Payment System for reimbursement has now been introduced to mental health care. This paper harnesses the MHMDS (now called MHSDS) using multi-level bivariate regression to investigate whether it is possible to control costs without negatively affecting outcomes. It does this by examining the relationship between costs and outcomes for mental health providers. Due to the nature of the data, an appropriate instrumental variable was not available, and so it is important to note that the results do not imply causality. The primary results found that after controlling for key variables (demographics, need, social and treatment) there was a minuscule negative correlation between residual costs and outcomes with little evidence of a meaningful relationship. That is, the data suggest that outcome improvements could be made without incurring a lot more cost. This implies that cost-containment efforts by providers should not undermine outcome-improving efforts under the new payment systems. Something to bear in mind when interpreting the results is that there was a rather large list of limitations associated with the analysis, most notably that the analysis was conducted at a provider level. Although it’s continually improving, there still remain issues with the MHMDS data: poor diagnosis coding, missing outcome data, and poor quality of cost data. As somebody who is yet to use MHMDS data, but plans to in the future, this was a useful paper for generating ideas regarding what is possible and the associated limitations.

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Sam Watson’s journal round-up for 12th June 2017

Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot. If you’d like to write one of our weekly journal round-ups, get in touch.

Machine learning: an applied econometric approach. Journal of Economic Perspectives [RePEcPublished Spring 2017

Machine learning tools have become ubiquitous in the software we use on a day to day basis. Facebook can identify faces in photos; Google can tell you the traffic for your journey; Netflix can recommend you movies based on what you’ve watched before. Machine learning algorithms provide a way to estimate an unknown function $f$ that predicts an outcome $Y$ given some data $x$: $Y = f(x) + \epsilon$. The potential application of these algorithms to many econometric problems is clear. This article outlines the principles of machine learning methods. It divides econometric problems into prediction, $\hat{y}$, and parameter estimation, $\hat{\beta}$ and suggests machine learning is a useful tool for the former. However, this distinction is a false one, I believe. Parameters are typically estimated because they represent an average treatment effect, say $E(y|x=1) - E(y|x=0)$. But, we can estimate these quantities in ‘$\hat{y}$ problems’ since $f(x) = E(y|x)$. Machine learning algorithms, therefore, represent a non-parametric (or very highly parametric) approach to the estimation of treatment effects. In cases where functional form is unknown, where there may be nonlinearities in the response function, and interactions between variables, this approach can be very useful. They do not represent a panacea to estimation problems of course, since interpretation rests on the assumptions. For example, as Jennifer Hill discusses, additive regression tree methods can be used to estimate conditional average treatment effects if we can assume the treatment is ignorable conditional on the covariates. This article, while providing a good summary of methods, doesn’t quite identify the right niche where these approaches might be useful in econometrics.

Incorporating equity in economic evaluations: a multi-attribute equity state approach. European Journal of Health Economics [PubMedPublished 1st June 2017

Efficiency is a key goal for the health service. Economic evaluation provides evidence to support investment decisions, whether displacing resources from one technology to another can produce greater health benefits. Equity is generally not formally considered except through the final investment decision-making process, which may lead to different decisions by different commissioning groups. One approach to incorporating equity considerations into economic evaluation is the weighting of benefits, such as QALYs, by group. For example, a number of studies have estimated that benefits of end-of-life treatments have a greater social valuation than other treatments. One way of incorporating this into economic evaluation is to raise the cost-effectiveness threshold by an appropriate amount for end-of-life treatments. However, multiple attributes may be relevant for equity considerations, negating a simplistic approach like this. This paper proposed a multi-attribute equity state approach to incorporating equity concerns formally in economic evaluation. The basic premise of this approach is to firstly define a set of morally relevant attributes, to secondly derive a weighting scheme for each set of characteristics (similarly to how QALY weights are derived from the EQ-5D questionnaire), and thirdly to apply these weights to economic evaluation. A key aspect of the last step is to weight both the QALYs gained by a population from a new technology and those displaced from another. Indeed, identifying where resources are displaced from is perhaps the biggest limitation to this approach. This displacement problem has also come up in other discussions revolving around the estimation of the cost-effectiveness threshold. This seems to be an important area for future research.

Financial incentives, hospital care, and health outcomes: evidence from fair pricing laws. American Economic Journal: Economic Policy [RePEcPublished May 2017

There is a not-insubstantial literature on the response of health care providers to financial incentives. Generally, providers behave as expected, which can often lead to adverse outcomes, such as overtreatment in cases where there is potential for revenue to be made. But empirical studies of this behaviour often rely upon the comparison of conditions with different incentive schedules; rarely is there the opportunity to study the effects of relative shifts in incentive within the same condition. This paper studies the effects of fair pricing laws in the US, which limited the amount uninsured patients would have to pay hospitals, thus providing the opportunity to study patients with the same conditions but who represent different levels of revenue for the hospital. The introduction of fair pricing laws was associated with a reduction in total billing costs and length of stay for uninsured patients but little association was seen with changes in quality. A similar effect was not seen in the insured suggesting the price ceiling introduced by the fair pricing laws led to an increase in efficiency.

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