A propensity score approach to estimating the cost–effectiveness of medical therapies from observational data

Abstract

Health summary measures are commonly used by policy makers to help make decisions on the allocation of societal resources for competing medical treatments. The net monetary benefit is a health summary measure that overcomes the statistical limitations of a popular measure namely, the cost-effectiveness ratio. We introduce a linear model framework to estimate propensity score adjusted net monetary benefit. This method provides less biased estimates in the presence of significant differences in baseline measures and demographic characteristics between treatment groups in quasi-randomized or observational studies. Simulation studies were conducted to better understand the utility of propensity score adjusted estimates of net monetary benefits when important covariates are unobserved. The results indicated that the propensity score adjusted net monetary benefit provides a robust measure of cost-effectiveness in the presence of hidden bias. The methods are illustrated using data from SEER-Medicare for the treatment of bladder cancer.

Cost-Effectiveness of Neoadjuvant Chemotherapy versus Primary Surgery in Elderly Patients with Advanced Ovarian Cancer

“…From a payer perspective (i.e., Medicare), we estimated incremental cost-effectiveness ratios (ICERs) and net monetary benefits (NMBs) to assess the cost-effectiveness of NAC [43][44][45][46], measured per life-year gained.…”

Cost-Effectiveness of White Blood Cell Growth Factor Use among a Large Nationwide Cohort of Elderly Non-Hodgkin's Lymphoma Patients Treated with Chemotherapy

“…The net monetary benefit approach for estimating cost-effectiveness is highly amenable to observational data insomuch as it allows for the modeling of the joint density of costs and effectiveness using standard regression techniques and leads to a less biased estimate of cost-effectiveness in the presence of significant differences in baseline measures between treatment groups in observational studies [21,22]. The net monetary benefit approach also overcomes the statistical limitations inherent to the traditional cost-effectiveness ratio (i.e., discontinuity of incremental cost-effectiveness ratio as the difference in effectiveness approaches zero) [23,24].…”

Comparing outcomes for youth in treatment foster care and family-style group care

“…Applications of propensity score matching technique can be found in a variety of disciplines, including medicine (Seeger, Williams & Walker, 2005;Mitra & Indurkhya, 2005;Iezzoni, 2003), education (Leow, Marcus, Zanutto & Boruch, 2004), public policy (Dahl & Lorentzen, 2005) and social work (Fraser, 2004;Sosin, 2002;El-bassel, Gilbert, Wu, Go & Hill, 2005). A growing interest in the utilization of this method is evident in child welfare studies (Guo, Barth & Gibbons, 2005;DeSena et al, 2005).…”