Three Pillars of Support for Orphan Drug Programs: Individual Valuations, Societal Valuations, and Anonymous Altruism.

OBJECTIVES: To identify and describe potential societal and individual sources of support for orphan drug programs. METHODS: The generalized risk-adjusted cost-effectiveness (GRACE) method shows that acute illness and disability severity increase individuals' willingness to pay (WTP) for health gains. We develop a social welfare function (SWF) that incorporates individuals' own values, combined with politically- or ethically determined weights. We introduce the concept of horizontal equity-that individuals in similar situations should be treated similarly-into the SWF. Finally, we introduce anonymous altruism into individuals' utility functions-the desire to help others, without knowing their identity. RESULTS: Combined with the empirical link between disease severity and rarity, GRACE demonstrates heightened WTP for health gains, leading rational individuals to support orphan drug programs, our first pillar of support. Adding horizontal equity to the SWF further increases societal support for orphan drug programs. Anonymous altruism, focusing most strongly on those in the most-dire circumstances, leads to altruistic support for those with severe disorders. Because innovators' economic incentives lead them to focus on larger markets, anonymous altruistic individuals to specifically support orphan drug programs. The presence of free-rider problems translates this into public program support. CONCLUSIONS: We identify supporting three pillars for orphan drug programs: (1) individuals' desire for treatments to treat rare disease that are often severe and life-threatening; (2) the concept of horizontal equity in our SWF: (3) anonymous altruism, the desire to people, even when unknown, in dire circumstances.

Methods to Adjust Willingness-to-Pay Measures for Severity of Illness.

OBJECTIVES: Both private sector organizations and governmental health agencies increasingly use illness severity measures to adjust willingness-to-pay thresholds. Three widely discussed methods-absolute shortfall (AS), proportional shortfall (PS), and fair innings (FI)-all use ad hoc adjustments to cost-effectiveness analysis methods and "stair-step" brackets to link illness severity with willingness-to-pay adjustments. We assess how these methods compare with microeconomic expected utility theory-based methods to value health gains. METHODS: We describe standard cost-effectiveness analysis methods, the basis from which AS, PS, and FI make severity adjustments. We then develop how the Generalized Risk Adjusted Cost Effectiveness (GRACE) model assesses value for differing illness and disability severity. We compare AS, PS, and FI against value as defined by GRACE. RESULTS: AS, PS, and FI have major and unresolved differences between them in how they value various medical interventions. Compared with GRACE, they fail to properly incorporate illness severity or disability. They conflate gains in health-related quality of life and life expectancy incorrectly and confuse the magnitude of treatment gains with value per quality-adjusted life-year. Stair-step methods also introduce important ethical concerns. CONCLUSIONS: AS, PS, and FI disagree with each other in major ways, demonstrating that at most, one correctly describes patients' preferences. GRACE offers a coherent alternative, based on neoclassical expected utility microeconomic theory, and can be readily implemented in future analyses. Other approaches that depend on ad hoc ethical statements have yet to be justified using sound axiomatic approaches.

Access to Disease-Modifying Alzheimer's Therapies: Addressing Possible Challenges Using Innovative Payment Models.

OBJECTIVES: Aduhelm is the first approved disease-modifying therapies (DMT) for Alzheimer disease (AD). Nevertheless, under current payment models, AD DMTs-especially because they treat broader populations-will pose challenges to patient access since costs may accrue sooner than benefits do. New payment approaches may be needed to address this difference in timing. METHODS: We use the Future Elderly Model that draws on nationally representative data sets such as the Health and Retirement Study to estimate the potential benefits because of hypothetical AD DMTs in 4 stylized treatment scenarios for patients with mild cognitive impairment or mild AD, and develop a payment model to estimate the accrual of net costs and benefits to private and public payers. RESULTS: The modeled AD DMTs result in clinical benefit of 0.30 to 0.55 quality-adjusted life-years gained per patient in the baseline treatment scenario and 0.13 to 0.24 quality-adjusted life-years gained per patient in the least optimistic scenario. Private payers may observe a net loss in patients at the age of 61 to 65 years under the status quo (payment upon treatment). Constant and deferred installment payment models resolve this issue. CONCLUSIONS: Innovative payment solutions, such as installment payments, may be required to address misaligned incentives that AD DMTs may create among patients younger than the age of 65 years and may help address concerns about the timing and magnitude of costs and benefits accrued to private payers.

Value of Reducing Wait Times for Chimeric Antigen Receptor T-Cell Treatment: Evidence From Randomized Controlled Trial Data on Tisagenlecleucel for Diffuse Large B-Cell Lymphoma.

OBJECTIVES: This study aimed to quantify the value of reducing chimeric antigen receptor T-cell (CAR-T) treatment wait times on patients with refractory and relapsed aggressive blood cancer who can newly gain access to treatment or access treatment earlier in their disease course. METHODS: Using data from the JULIET clinical trial, we first identified the number of additional patients with diffuse large B-cell lymphoma that would have been treated with tisagenlecleucel CAR-T therapy if wait times were shortened. For these patients, we estimated mortality benefits using literature estimates of CAR-T effectiveness. Next, among patients who already received CAR-T, we estimated tumor burden progression over time using a linear probability regression model. The primary outcome variable was an indicator for having above-normal lactate dehydrogenase, and we controlled for time, use of bridging therapy, and time-invariant patient characteristics. The regression results, along with literature estimates relating lactate dehydrogenase to CAR-T effectiveness, were used to compute the survival benefits of earlier CAR-T treatment. RESULTS: Reducing wait times by 2 months increased the number of eligible patients receiving CAR-T by at least 10.7%. For patients already receiving tisagenlecleucel CAR-T, a 2-month reduction in wait times generated a 3.3% increase in survival gains per treated patient. Thus, among patients seeking treatment, the combined treatment efficacy increased by 14%, with approximately one-quarter of survival benefits accruing to existing patients receiving faster treatment. CONCLUSIONS: Delays affected not only access to CAR-T treatments but also treatment effectiveness. Our results highlight the survival benefits of expediting treatment access and may help explain some observed differences in CAR-T effectiveness across countries.

Crosswalk between the Mini-Mental State Examination and the Telephone Interview for Cognitive Status (TICS-27/30/40).

BACKGROUND: We develop a crosswalk between the Mini-Mental State Examination (MMSE) and Telephone Interview for Cognitive Status (TICS)-27, TICS-30, and TICS-40 for adults 65 years and older. METHODS: We examined the scores of 1809 participants, with and without cognitive impairment, who completed the MMSE and the TICS assessment in the 2016 Health and Retirement Study and the 2016 Harmonized Cognitive Assessment Protocol study. Crosswalks between MMSE and TICS-27/30/40 were developed via equipercentile equating. RESULTS: We present crosswalks for MMSE and TICS-27/30/40 for the 65+ population representative of the US elderly. While monotonic, the pattern of the TICS-30 to MMSE crosswalk differs from the other two crosswalks (MMSE to TICS-27/40). CONCLUSION: Our analysis offers an empirical crosswalk between two commonly used cognitive measures-the MMSE and TICS. Our findings suggest the need for validated and robust measures that allow for the comparison of scores on different cognitive scales.

Health Technology Assessment With Diminishing Returns to Health: The Generalized Risk-Adjusted Cost-Effectiveness (GRACE) Approach.

OBJECTIVES: Cost-effectiveness analysis (CEA) embeds an assumption at odds with most economic analysis-that of constant returns to health in the creation of happiness (utility). We aim to reconcile it with the bulk of economic theory. METHODS: We generalize the traditional CEA approach, allow diminishing returns to health, and align CEA with the rest of the health economics literature. RESULTS: This simple change has far-reaching implications for the practice of CEA. First, optimal cost-effectiveness thresholds should systematically rise for more severe diseases and fall for milder ones. We provide formulae for estimating how these thresholds vary with health-related quality of life (QoL) in the sick state. Practitioners can also use our approach to account for treatment outcome uncertainty. Holding average benefits fixed, risk-averse consumers value interventions more when they reduce outcome uncertainty ('insurance value') and/or when they provide a chance at positively skewed outcomes ('value of hope'). Finally, we provide a coherent way to combine improvements in QoL and life expectancy (LE) when people have diminishing returns to QoL. CONCLUSION: This new approach obviates the need for increasingly prevalent and ad hoc exceptions to CEA for end-of-life care, rare disease, and very severe disease (eg, cancer). Our methods also show that the value of improving QoL for disabled people is greater than for comparable non-disabled people, thus resolving an ongoing and mathematically legitimate objection to CEA raised by advocates for disabled people. Our Generalized Risk-Adjusted Cost-Effectiveness (GRACE) approach helps align HTA practice with realistic preferences for health and risk.

Predicting quantity and quality of life with the Future Elderly Model.

The Future Elderly Model (FEM) is a microsimulation model designed to forecast health status, longevity, and a variety of economic outcomes. Compared to traditional actuarial models, microsimulation models provide greater opportunities for policy forecasting and richer detail, but they typically build upon smaller samples of data that may mitigate forecasting accuracy. We perform validation analyses of the FEM's mortality and quality of life forecasts using a version of the FEM estimated exclusively on early waves of data from the Health and Retirement Study. First, we compare FEM mortality and longevity projections to the actual mortality and longevity experience observed over the same period of time. We also compare the FEM results to actuarial forecasts of mortality and longevity during the same time. We find that FEM projections are generally in line with observed mortality rates and closely match longevity. Then, we assess the FEM's performance at predicting quality of life and longitudinal outcomes, two features missing from traditional actuarial models. Our analysis suggests the FEM performs at least as well as actuarial forecasts of mortality, while providing policy simulation features that are not available in actuarial models.

Lifetime Economic Burden of Crohn's Disease and Ulcerative Colitis by Age at Diagnosis.

BACKGROUND & AIMS: Understanding the burden of Crohn's disease (CD) and ulcerative colitis (UC) is important for measuring treatment value. We estimated lifetime health care costs incurred by patients with CD or UC by age at diagnosis. METHODS: We collected data from 78,620 patients with CD, 85,755 with UC, and propensity score-matched control subjects from the Truven Health MarketScan insurance claims databases (2008‒2015). Total medical (inpatient, outpatient) and pharmacy costs were captured. Cost variations over a lifetime were estimated in cost-state Markov models by age at diagnosis, adjusted to 2016 U.S. dollars and discounted at 3% per annum. We measured lifetime total and lifetime incremental cost (the difference between costs of CD or UC patients vs matched controls). RESULTS: For CD, the lifetime incremental cost was $707,711 among patients who received their diagnosis at 0‒11 years, and $177,614 for patients 70 years or older, averaging $416,352 for a diagnosis at any age. Lifetime total cost was $622,056, consisting of outpatient ($273,056), inpatient ($164,298), pharmacy ($163,722), and emergency room (ER) ($20,979) costs. For UC, the lifetime incremental cost was $369,955 among patients who received their diagnosis at 0‒11 years, and $132,396 for individuals 70 years or older, averaging $230,102 for a diagnosis at any age. Lifetime total cost was $405,496, consisting of outpatient ($163,670), inpatient ($123,190), pharmacy ($105,142), and ER ($13,493) costs. Therefore, the prevalent populations of patients with CD or UC in the United States in 2016 are expected to incur lifetime total costs of $498 billion and $377 billion, respectively. CONCLUSIONS: Using a Markov model, we estimated lifetime costs for patients with CD or UC to exceed previously published estimates. Individuals who receive a diagnosis of CD or UC at an early age (younger than 11 years) incur the highest lifetime cost burden. Advancing management strategies may significantly improve patient outcomes and reduce lifetime health care spending.

Does Medicare Coverage Improve Cancer Detection and Mortality Outcomes?

Medicare is a large government health insurance program in the United States that covers about 60 million people. This paper analyzes the effects of Medicare insurance on health for a group of people in urgent need of medical care: people with cancer. We used a regression discontinuity design to assess impacts of near-universal Medicare insurance at age 65 on cancer detection and outcomes, using population-based cancer registries and vital statistics data. Our analysis focused on the three tumor sites for which screening is recommended both before and after age 65: breast, colorectal, and lung cancer. At age 65, cancer detection increased by 72 per 100,000 population among women and 33 per 100,000 population among men; cancer mortality also decreased by nine per 100,000 population for women but did not significantly change for men. In a placebo check, we found no comparable changes at age 65 in Canada. This study provides the first evidence to our knowledge that near-universal access to Medicare at age 65 is associated with improvements in population-level cancer mortality.

Using Information on Patient Adherence to Antipsychotic Medication to Understand Their Adherence to Other Medications.

PURPOSE: To assess how patient adherence to atypical antipsychotic medications is associated with adherence to concurrently used medications that treat other serious mental illnesses (SMIs), type-2 diabetes, or hypertension. METHODS: Among patients who had been diagnosed with an SMI (i.e., bipolar disorder, major depressive disorder, or schizophrenia) in the previous year, we used health-insurance claims data to measure adherence based on medication fills. Patients diagnosed with an SMI were required to have 1) a prescription for an atypical oral antipsychotic, and 2) another SMI therapy or oral anti-diabetic or antihypertensive agent in the same year. The patient's concurrent adherence to an antipsychotic and one of 23 other medications was measured by the proportion of days covered (PDC) over a one-year period. Patients were considered adherent when the PDC was ≥ 80%. The strength of the association between their atypical antipsychotic adherence and their concurrent medication adherence was evaluated using the following metrics: accuracy, positive predictive value (PPV), and negative predictive value (NPV). RESULTS: The average (standard deviation) age of patients (N = 129,614) was 44.8 (14.8) years and 62.2% of patients were female. The median accuracy based on atypical antipsychotic adherence to the other 23 medications was 67% (range, 55-71%; statistically different from 50% accuracy in all cases, P < 0.001). Accuracy was higher than physician predictions of adherence from previous studies (53%). The negative predictive value of antipsychotic adherence (75%; range, 62-88%) was generally higher than the PPV (62%; range, 43-67%; all, P < 0.001). CONCLUSION: Information on patient adherence to antipsychotics provides significant insight into adherence to other medications often used by patients with SMI. Because NPV is higher than PPV, adherence to antipsychotics is likely to be a necessary but not sufficient condition for patients with SMI regarding adherence to non-SMI medications.

Defining Elements of Value in Health Care-A Health Economics Approach: An ISPOR Special Task Force Report [3].

The third section of our Special Task Force report identifies and defines a series of elements that warrant consideration in value assessments of medical technologies. We aim to broaden the view of what constitutes value in health care and to spur new research on incorporating additional elements of value into cost-effectiveness analysis (CEA). Twelve potential elements of value are considered. Four of them-quality-adjusted life-years, net costs, productivity, and adherence-improving factors-are conventionally included or considered in value assessments. Eight others, which would be more novel in economic assessments, are defined and discussed: reduction in uncertainty, fear of contagion, insurance value, severity of disease, value of hope, real option value, equity, and scientific spillovers. Most of these are theoretically well understood and available for inclusion in value assessments. The two exceptions are equity and scientific spillover effects, which require more theoretical development and consensus. A number of regulatory authorities around the globe have shown interest in some of these novel elements. Augmenting CEA to consider these additional elements would result in a more comprehensive CEA in line with the "impact inventory" of the Second Panel on Cost-Effectiveness in Health and Medicine. Possible approaches for valuation and inclusion of these elements include integrating them as part of a net monetary benefit calculation, including elements as attributes in health state descriptions, or using them as criteria in a multicriteria decision analysis. Further research is needed on how best to measure and include them in decision making.

Approaches to Aggregation and Decision Making-A Health Economics Approach: An ISPOR Special Task Force Report [5].

The fifth section of our Special Task Force report identifies and discusses two aggregation issues: 1) aggregation of cost and benefit information across individuals to a population level for benefit plan decision making and 2) combining multiple elements of value into a single value metric for individuals. First, we argue that additional elements could be included in measures of value, but such elements have not generally been included in measures of quality-adjusted life-years. For example, we describe a recently developed extended cost-effectiveness analysis (ECEA) that provides a good example of how to use a broader concept of utility. ECEA adds two features-measures of financial risk protection and income distributional consequences. We then discuss a further option for expanding this approach-augmented CEA, which can introduce many value measures. Neither of these approaches, however, provide a comprehensive measure of value. To resolve this issue, we review a technique called multicriteria decision analysis that can provide a comprehensive measure of value. We then discuss budget-setting and prioritization using multicriteria decision analysis, issues not yet fully resolved. Next, we discuss deliberative processes, which represent another important approach for population- or plan-level decisions used by many health technology assessment bodies. These use quantitative information on CEA and other elements, but the group decisions are reached by a deliberative voting process. Finally, we briefly discuss the use of stated preference methods for developing "hedonic" value frameworks, and conclude with some recommendations in this area.

A Health Economics Approach to US Value Assessment Frameworks-Summary and Recommendations of the ISPOR Special Task Force Report [7].

This summary section first lists key points from each of the six sections of the report, followed by six key recommendations. The Special Task Force chose to take a health economics approach to the question of whether a health plan should cover and reimburse a specific technology, beginning with the view that the conventional cost-per-quality-adjusted life-year metric has both strengths as a starting point and recognized limitations. This report calls for the development of a more comprehensive economic evaluation that could include novel elements of value (e.g., insurance value and equity) as part of either an "augmented" cost-effectiveness analysis or a multicriteria decision analysis. Given an aggregation of elements to a measure of value, consistent use of a cost-effectiveness threshold can help ensure the maximization of health gain and well-being for a given budget. These decisions can benefit from the use of deliberative processes. The six recommendations are to: 1) be explicit about decision context and perspective in value assessment frameworks; 2) base health plan coverage and reimbursement decisions on an evaluation of the incremental costs and benefits of health care technologies as is provided by cost-effectiveness analysis; 3) develop value thresholds to serve as one important input to help guide coverage and reimbursement decisions; 4) manage budget constraints and affordability on the basis of cost-effectiveness principles; 5) test and consider using structured deliberative processes for health plan coverage and reimbursement decisions; and 6) explore and test novel elements of benefit to improve value measures that reflect the perspectives of both plan members and patients.

Innovative Contracting for Pharmaceuticals and Medicaid's Best-Price Rule.

In recent years, drug manufacturers and private payers have expressed interest in novel pricing models that more closely link a drug's price to its value. Indication-based pricing, outcome-based pricing, drug licenses, and drug mortgages have all been discussed as alternatives to paying strictly for volume. Manufacturers and payers have complained, however, that Medicaid's "best-price rule" inhibits their ability to enter into these new pricing arrangements. This article examines the best-price rule and assesses to what extent, if any, it might frustrate the goal of paying for value. We conclude that the best-price rule is not as serious a problem as it is sometimes made out to be but that it is also not simply a convenient excuse for refusing to try something new. The law here is complex, and moving to a pay-for-value model for drugs will require close coordination among manufacturers, payers, and regulators.

Predicting Real-World Effectiveness of Cancer Therapies Using Overall Survival and Progression-Free Survival from Clinical Trials: Empirical Evidence for the ASCO Value Framework.

OBJECTIVES: To measure the relationship between randomized controlled trial (RCT) efficacy and real-world effectiveness for oncology treatments as well as how this relationship varies depending on an RCT's use of surrogate versus overall survival (OS) endpoints. METHODS: We abstracted treatment efficacy measures from 21 phase III RCTs reporting OS and either progression-free survival or time to progression endpoints in breast, colorectal, lung, ovarian, and pancreatic cancers. For these treatments, we estimated real-world OS as the mortality hazard ratio (RW MHR) among patients meeting RCT inclusion criteria in Surveillance and Epidemiology End Results-Medicare data. The primary outcome variable was real-world OS observed in the Surveillance and Epidemiology End Results-Medicare data. We used a Cox proportional hazard regression model to calibrate the differences between RW MHR and the hazard ratios on the basis of RCTs using either OS (RCT MHR) or progression-free survival/time to progression surrogate (RCT surrogate hazard ratio [SHR]) endpoints. RESULTS: Treatment arm therapies reduced mortality in RCTs relative to controls (average RCT MHR = 0.85; range 0.56-1.10) and lowered progression (average RCT SHR = 0.73; range 0.43-1.03). Among real-world patients who used either the treatment or the control arm regimens evaluated in the relevant RCT, RW MHRs were 0.6% (95% confidence interval -3.5% to 4.8%) higher than RCT MHRs, and RW MHRs were 15.7% (95% confidence interval 11.0% to 20.5%) higher than RCT SHRs. CONCLUSIONS: Real-world OS treatment benefits were similar to those observed in RCTs based on OS endpoints, but were 16% less than RCT efficacy estimates based on surrogate endpoints. These results, however, varied by tumor and line of therapy.

Estimating the future burden of cardiovascular disease and the value of lipid and blood pressure control therapies in China.

BACKGROUND: Lifestyle and dietary changes reflect an ongoing epidemiological transition in China, with cardiovascular disease (CVD) playing an ever-increasing role in China's disease burden. This study assessed the burden of CVD and the potential value of lipid and blood pressure control strategies in China. METHODS: We estimated the likely burden of CVD between 2016 and 2030 and how expanded use of lipid lowering and blood pressure control medication would impact that burden in the next 15 years. Accounting for the costs of drug use, we assessed the net social value of a policy that expands the utilization of lipid and blood pressure lowering therapies in China. RESULTS: Rises in prevalence of CVD risk and population aging would likely increase the incidence of acute myocardial infarctions (AMIs) by 75 million and strokes by 118 million, while the number of CVD deaths would rise by 39 million in total between 2016 and 2030. Universal treatment of hypertension and dyslipidemia patients with lipid and blood pressure lowering therapies could avert between 10 and 20 million AMIs, between 8 and 30 million strokes, and between 3 and 10 million CVD deaths during the 2016-2030 period, producing a positive social value net of health care costs as high as $932 billion. CONCLUSIONS: In light of its aging population and epidemiological transition, China faces near-certain increases in CVD morbidity and mortality. Preventative measures such as effective lipid and blood pressure management may reduce CVD burden substantially and provide large social value. While the Chinese government is implementing more systematic approaches to health care delivery, prevention of CVD should be high on the agenda.

A principled approach to non-discrimination in cost-effectiveness.

The US Inflation Reduction Act (IRA) prohibits the Centers for Medicare and Medicaid Services (CMS) from using standard quality-adjusted life-years or other value assessment methods that discriminate against the aged, terminally ill, or disabled when setting maximum fair prices for prescription drugs. This policy has reignited interest in methods for assessing value without discrimination. Equal value of life-years gained (EVL), healthy years in total (HYT), and Generalized Risk-Adjusted Cost-Effectiveness (GRACE) have emerged as proposals. Neither EVL nor HYT rests on well-articulated microeconomic foundations. We show that they produce decisions that are inconsistent over time in a variety of ways, including: (1) failure to support additivity and indirect comparison in cases where the standard-of-care therapy changes over time; (2) strictly negative value of survival gains that accrue from a new, better standard-of-care, particularly for the disabled themselves; (3) unbounded average value of survival gains; and (4) non-convex survival preferences. We propose an alternative method that relies on GRACE and its microeconomic foundations.

Societal Preferences for Subsidizing Treatments Targeting Patients With Advanced Illness: A Discrete Choice Experiment.

OBJECTIVES: Cost-effectiveness analyses are increasingly used to inform subvention decisions for moderately life extending treatments but apply several simplifying assumptions that may be inconsistent with public preferences. Contrary to standard assumptions, we hypothesize that societal willingness to allocate public funding toward these treatments is (1) diminishing for incremental improvements in survival and quality of life (QoL) and (2) greater for subvention policies that exclude the oldest old (>80 years). METHODS: We tested these hypotheses using a web-based discrete choice experiment (n = 425) in Singapore. In each of 5 questions, respondents were shown 2 hypothetical treatments targeting patients with an expected prognosis of 2 months at very poor QoL and asked which treatment they wanted the government to subsidize, if any. Treatments were defined by 4 attributes: cost to the government, age of beneficiaries, expected gain in survival (2-12 months), and QoL (poor, fair, and good). RESULTS: Latent class models were used to analyze results. Results revealed 2 classes. In the majority class (69.7% of sample), respondents value incremental gains in survival and QoL at a diminishing rate. Their willingness to allocate public funding estimates (Singapore dollars 16 825-91 027 per patient per month) were much higher than traditional cost-effectiveness thresholds. In the second class, respondents were unwilling to subsidize treatments offering less than 2 months of life extension or poor QoL. Neither class preferred subvention policies that exclude the oldest old. CONCLUSIONS: These findings suggest that the Singapore government should consider cost-effectiveness thresholds that rise with increases in life extension. Age-based restrictions should not be imposed.

Risk preferences over health: Empirical estimates and implications for medical decision-making.

Mainstream health economic theory implies that an expected gain in health-related quality of life (HRQoL) produces the same value for consumers, regardless of baseline health. Several strands of recent research call this implication into question. Generalized Risk-Adjusted Cost-Effectiveness (GRACE) demonstrates theoretically that baseline health status influences value, so long as consumers are not risk-neutral over health. Prior empirical literature casts doubt on risk-neutral expected utility-maximization in the health domain. We estimate utility over HRQoL in a nationally representative U.S. population and use our estimates to measure risk preferences over health. We find that individuals are risk-seeking at low levels of health, become risk-averse at health equal to 0.485 (measured on a 0-1 scale), and are most risk-averse at perfect health (coefficient of relative risk aversion = 4.51). We develop the resulting implications for medical decision making, cost-effectiveness analyses, and the proper theory of health-related decision making under uncertainty.

Assessment of Medical and Public Assistance Expenditures and Employment Among US Adults With Cancer Diagnoses.

Importance: Prior research suggests significant social value associated with increased longevity due to preventing and treating cancer. Other social costs associated with cancer, such as unemployment, public medical spending, and public assistance, may also be sizable. Objective: To examine whether a cancer history is associated with receipt of disability insurance, income, employment, and medical spending. Design, Setting, and Participants: This cross-sectional study used data from the Medical Expenditure Panel Study (MEPS) (2010-2016) for a nationally representative sample of US adults aged 50 to 79 years. Data were analyzed from December 2021 to March 2023. Exposure: Cancer history. Main Outcomes and Measures: The main outcomes were employment, public assistance receipt, disability, and medical expenditures. Variables for race, ethnicity, and age were used as controls. A series of multivariate regression models were used to assess the immediate and 2-year association of a cancer history with disability, income, employment, and medical spending. Results: Of 39 439 unique MEPS respondents included in the study, 52% were female, and the mean (SD) age was 61.44 (8.32) years; 12% of respondents had a history of cancer. Individuals with a cancer history who were aged 50 to 64 years were 9.80 (95% CI, 7.35-12.25) percentage points more likely to have a work-limiting disability and were 9.08 (95% CI, 6.22-11.94) percentage points less likely to be employed compared with individuals in the same age group without a history of cancer. Nationally, cancer accounted for 505 768 fewer employed individuals in the population aged 50 to 64 years. A cancer history was also associated with an increase of $2722 (95% CI, $2131-$3313) in medical spending, $6460 (95% CI, $5254-$7667) in public medical spending, and $515 (95% CI, $337-$692) in other public assistance spending. Conclusions and Relevance: In this cross-sectional study, a history of cancer was associated with increased likelihood of disability, higher medical spending, and decreased likelihood of employment. These findings suggest there may be gains beyond increased longevity if cancer can be detected and treated earlier.