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When it comes to allocating finite health care resources, a focus on longevity and “glamorous” high-tech disease treatment has been distracting our attention away from the benefits of disease prevention.
Opportunity cost is an economics term that I first heard at a workshop on palliative care and casemix (SNAP) run by Professor Kathy Eagar and Dr Michael Smith (then president of Palliative Care Australia) sometime in the mid-1990s (see, I was listening!). It has broad utility, including in the context of health care.
In health care, an opportunity cost is an outcome that is not achieved (ie, is missed) when an activity is not funded — for example, the opportunity costs of not funding an effective smoking prevention and cessation program are that those who are never persuaded not to smoke miss out on the opportunity to avoid adverse health outcomes that their community must then pay to treat. This is often compared to the loss of a lesser benefit gained from an alternative use of the same amount of money spent on smaller set of patients — such as expensive chemotherapy for advanced lung cancer and treatments for pulmonary and vascular disease. Clearly, many decisions about allocating health care funding are not between eggs and chickens, but very complex and difficult chalk and cheese choices that straddle divides between disciplines and can play out over decades.
Skyrocketing medication costs
In one of the more interesting articles I read recently in the Internal Medicine Journal, Narcyz Ghinea addressed the increasing costs of medicines and their implications for patients, physicians and the health system. It describes how the extraordinary costs of newly invented medications are grabbing an increasing proportion of the health care budget, with the top 15 drugs currently costing 27% of the Pharmaceutical Benefits Scheme budget.
Most of these drugs are patented high-tech products of the biological sciences that explain the genetic and molecular basis of diseases. As described in the article, these drugs are used to treat cancers and an increasing range of orphan diseases, often hereditary, that affect only small numbers of patients. For the latter, in particular, access can be both dazzlingly life-changing, and yet shockingly expensive.
A single dose of Hemgenix for haemophilia B costs US$3.5 million dollars, and the recently introduced treatment for cystic fibrosis costs US$300 000 per patient per year for life, or at least until the patent runs out. And when sofosbuvir was invented as a cure for hepatitis C, its price at the time was such that, were it to have been prescribed to all eligible American patients, the cost would have equalled the sum of all other medications prescribed in the USA.
As described by Ghinea, the consequence of the escalating use of new and expensive drugs is that:
“… more money is spent on fewer patients. These medicines are expected to represent 55% of total medicine spending in developed countries like Australia by 2027, but they only treat 2–3% of patients.”
Quantity over quality
While some of the treatments for orphan diseases produce very clear and significant lifelong benefits, Ghinea also describes how many of the expensive drugs that are approved by the Therapeutic Goods Administration for the treatment of cancer show only limited benefit, including a minimal increase in life expectancy of only a few months, and with little or no improvement in quality of life.
In 2010 Temel and colleagues published a study of patients with advanced lung cancer who received inexpensive symptom control and open conversations in addition to standard treatment. Many were empowered to pursue their personal goals for the remainder of their life and some chose not to receive the more aggressive (and expensive) anti-cancer treatments. The treatment group on average lived ~30% longer than controls, suggesting that for many patients, aggressive treatment of advanced and progressive disease shortens lives. Regulators would be trampled underfoot in the stampede to approve any drug that offered a 30% increase in life expectancy.
For years, we have embraced the virtues of the pursuit of greater life expectancy by the application of technology. Governments, health care funders and service providers all have to deal with patients, their families and clinicians who believe that they should be able to access any treatments that might improve life expectancy, whatever the cost and however small the benefits might be. These expectations are nurtured by drug manufacturers and their managers (whose raison d’etre is to make as much money as possible) using a range of tactics that have, at times, been unethical or even illegal (here and here).
At first glance, decisions about whether or not to fund a particular treatment may seem to be simple binary choices. Currently much of the effort of decision-making goes into deciding the details of the allocation of large amounts of money to the limited gains from treating far advanced disease at the end of life. While clinicians are probably the most appropriate people to be assessing the evidence for how to achieve the best treatment outcomes within their own fields, they are among the least appropriate to be approving the formative standards that normalise expectations of resource allocation for treatment for which they have an intrinsic bias. We tend to forget that there is but one pool of limited resources and that resource allocation decisions are being made for all expenditure across an entire nation. There is far more at stake than simply whether or not a subgroup of patients receives an expensive drug.
Until recently, the focus on longevity and “glamorous” high-tech disease treatment has been distracting our attention away from the benefits of disease prevention. Now, as the rate of increase in life expectancy has stalled as we run into the wall of humanity’s biological maximum life expectancy (here, here, and here) and attention has started to shift to how we might increase the healthy life span — the number of years and the proportion of life that people live before they develop significant pathology that diminishes their quality of life until they die.
Prevention rather than treatment
Of course, everyone can benefit from the pursuit of a healthier life span.
So, considering the opportunity costs, might it be more effective to allocate a much higher proportion of our finite health care resources to a broad and effective program of health promotion, disease prevention and early disease management?
Cuba has a life expectancy of 78.26 years from the expenditure (in 2021) of $3033 per capita annually on a universal health care system focused on primary care and prevention. In 2022 the US, with its far-from-universal health care system, spent $12 473 for a life expectancy of 79.46 years.
A robust system of primary care by well supported GPs and associated allied health with the goal of preventing and controlling disease, can at least delay and sometimes prevent long term expenditure across a wide range of diseases and thus generate great benefits across the whole community, and increase our health span.
This will require accepting death as the normal and inevitable outcome of every life, and shifting the focus, and some of the resources of health care from the pursuit of the quantity of a life to the quality of the person’s experience of that life. Additionally, and perhaps paradoxically, a focus on healthy life spans may increase overall life expectancy by reducing the incidence of some of the acquired diseases that cause people to die before they have otherwise achieved their personal maximum biological life expectancy.
Fortunately, the avenues to a healthier life span are less expensive than the treatments for many advanced diseases, but supporting them means the re-allocation of resources, and that would require the explicit re-prioritisation and re-design of the processes of decision making.
The role/duty of government in a democracy is to assess the balance of interests across the full spectrum of the needs of the community, and over timeframes that may extend far into the future. Unfortunately, we hear little talk of the assessment of opportunity costs that must underpin such choices.
Determining the equitable distribution of insufficient resources for best effect across the whole community requires a robust and ethical system founded in community values. Only candour and transparency about the balance of the pluses and the minuses, the opportunities taken, and the opportunities missed — the net benefit — from the decisions being made can generate the acceptance necessary to sustain community cohesion as it becomes increasingly necessary and common to hear “Sorry, no”.
Dr Will Cairns has retired from clinical practice as a palliative medicine specialist.
The statements or opinions expressed in this article reflect the views of the authors and do not necessarily represent the official policy of the AMA, the MJA or InSight+ unless so stated.
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A much needed perspective. I feel this rationalist economic approach to the COVID problem in Australia was sorely missing.
Health care spending can easily be swayed by emotive decision making, particularly in the way public opinion affects politics. Careful consideration of the cost / benefit of medical treatment is needed to balance this, as Dr Cairns adeptly points out.