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ARTICLE

Cost-Effectiveness of Full Medicare Coverage of Angiotensin-Converting Enzyme Inhibitors for Beneficiaries with Diabetes

Allison B. Rosen, MD, MPH, ScD; Mary Beth Hamel, MD, MPH; Milton C. Weinstein, PhD; David M. Cutler, PhD; A. Mark Fendrick, MD; and Sandeep Vijan, MD, MS

19 July 2005 | Volume 143 Issue 2 | Pages 89-99

Background: Angiotensin-converting enzyme (ACE) inhibitors slow renal disease progression and reduce cardiac morbidity and mortality in patients with diabetes. Patients' out-of-pocket costs pose a barrier to using this effective therapy.

Objective: To estimate the cost-effectiveness to Medicare of first-dollar coverage (no cost sharing) of ACE inhibitors for beneficiaries with diabetes.

Design: Markov model with costs and benefits discounted at 3%.

Data Sources: Published literature and Medicare claims data.

Target Population: 65-year-old Medicare beneficiary with diabetes.

Time Horizon: Lifetime.

Perspective: Medicare and societal.

Interventions: We evaluated Medicare first-dollar coverage of ACE inhibitors compared with current practice (no coverage) and the new Medicare drug benefit.

Outcome Measures: Costs (2003 U.S. dollars), quality-adjusted life-years (QALYs), life-years, and incremental cost-effectiveness.

Results of Base-Case Analysis: Compared with current practice, first-dollar coverage of ACE inhibitors saved both lives and money (0.23 QALYs gained and $1606 saved per Medicare beneficiary). Compared with the new Medicare drug benefit, first-dollar coverage remained a dominant strategy (0.15 QALYs gained, $922 saved).

Results of Sensitivity Analysis: Results were most sensitive to our estimate of increase in ACE inhibitor use; however, if ACE inhibitor use increased by only 7.2% (from 40% to 47.2%), first-dollar coverage would remain life-saving at no net cost to Medicare. In analyses conducted from the societal perspective, benefits were similar and cost savings were larger.

Limitations: Results depend on accuracy of the underlying data and assumptions. The effect of more generous drug coverage on medication adherence is uncertain.

Conclusions: Medicare first-dollar coverage of ACE inhibitors for beneficiaries with diabetes appears to extend life and reduce Medicare program costs. A reduction in program costs may result in more money to spend on other health care needs of the elderly.

Editors' Notes Context Economic barriers may contribute to the underutilization of angiotensin-converting enzyme (ACE) inhibitors in patients with diabetes. Contribution This analysis shows that the Medicare program could improve clinical outcomes and save money by providing full coverage of ACE inhibitors with no out-of-pocket expense for patients with diabetes. Clinical and economic benefits would exist even if full coverage only resulted in a modest increase (7.2%) in ACE inhibitor use. Implications Insurers should consider a policy of covering the entire cost of drugs that improve outcomes and lengthen life. –The Editors

 

Author and Article Information

From the University of Michigan Health System and Ann Arbor Veterans Affairs Medical Center, Ann Arbor, Michigan; Beth Israel Deaconess Medical Center and Harvard School of Public Health, Boston, Massachusetts; and Harvard University, Cambridge, Massachusetts.

Acknowledgments: The authors thank Joseph Newhouse, PhD; Lisa Iezzoni, MD, MSc; and Peter Neumann, ScD, for their helpful suggestions on the design and conduct of the analyses. The authors also thank Gerard Anderson, PhD, for his assistance in obtaining Medicare expenditure estimates for individuals with diabetes.

Grant Support: Dr. Rosen was supported by an AHRQ Health Services Research Fellowship at the Harvard School of Public Health (grant 5 T32 HS00020-16). Additional funding was provided by the Primary Care Research Fund of Brigham and Women's Hospital, which had no role in the design and conduct of the study; collection, management, analysis, and interpretation of the data; or preparation, review, or approval of the manuscript.

Potential Financial Conflicts of Interest: None disclosed.

Requests for Single Reprints: Allison B. Rosen, MD, MPH, ScD, Division of General Medicine, University of Michigan Health Systems, 300 North Ingalls, Suite 7E10, Ann Arbor, MI 48109; e-mail, abrosen{at}umich.edu.

Current Author Addresses: Dr. Rosen: Division of General Medicine, University of Michigan Health Systems, 300 North Ingalls, Suite 7E10, Ann Arbor, MI 48109.

Dr. Hamel: Division of General Medicine and Primary Care, Beth Israel Deaconess Medical Center, 330 Brookline Avenue, Boston, MA 02215.

Dr. Weinstein: Department of Health Policy and Management, Harvard School of Public Health, 718 Huntington Avenue, Boston, MA 02115.

Dr. Cutler: University Hall, Ground Floor North, Harvard University, Cambridge, MA 02138.

Dr. Fendrick: Division of General Medicine, University of Michigan Health Systems, 300 North Ingalls, Suite 7C27, Ann Arbor, MI 48109.

Dr. Vijan: Department of Health Services Research & Development, Ann Arbor Veterans Affairs Medical Center, PO Box 130170, Ann Arbor, MI 48113-0170.

Author Contributions: Conception and design: A.B. Rosen, M.B. Hamel, S. Vijan.

Analysis and interpretation of the data: A.B. Rosen, M.B. Hamel, S. Vijan.

Drafting of the article: A.B. Rosen, D.M. Cutler, S. Vijan.

Critical revision of the article for important intellectual content: A.B. Rosen, M.B. Hamel, M.C. Weinstein, D.M. Cutler, A.M. Fendrick, S. Vijan.

Final approval of the article: A.B. Rosen, M.B. Hamel, M.C. Weinstein, D.M. Cutler, A.M. Fendrick, S. Vijan.

Statistical expertise: A.B. Rosen, M.C. Weinstein, S. Vijan.

Obtaining of funding: A.B. Rosen.

Collection and assembly of data: A.B. Rosen.

Related articles in Annals:

Letters
Medicare Coverage of Angiotensin-Converting Enzyme Inhibitors
Vinod N. Velakaturi

Annals 2005 143: 918. [Full Text]  

Letters
Medicare Coverage of Angiotensin-Converting Enzyme Inhibitors
Allison B. Rosen, A. Mark Fendrick, AND Sandeep Vijan

Annals 2005 143: 918. [Full Text]  

Summaries for Patients
The Cost-Effectiveness of Full Medicare Coverage of Angiotensin-Converting Enzyme Inhibitors for Patients with Diabetes

Annals 2005 143: I-21. [Full Text]  

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