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Supplements Economic Impact of Irritable Bowel Syndrome: What Does the Future Hold?
Economic Impact of Irritable Bowel Syndrome: What Does the Future Hold?
Brooks Cash, MD, FACP
Tegaserod Treatment for IBS: A Model of Indirect Costs
Dean G. Smith, PhD; Victoria Barghout, MSPH; and Kristijan H. Kahler, SM
Effectiveness of Tegaserod Therapy on GI-related Resource Utilization in a Managed Care Population
Judith J. Stephenson, SM; Victoria Barghout, MSPH; Kristijan H. Kahler, SM; Joaquim Fernandes, BA; Jane F. Beaulieu, MSN; Samuel Joo, MS; and Stephen J. Boccuzzi, PhD
Total Costs of IBS: Employer and Managed Care Perspective
Brooks Cash, MD, FACP; Sean Sullivan, JD; and Victoria Barghout, MSPH
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Budget Impact of Tegaserod on a Managed Care Organization Formulary
Michael A. Bloom, BA; Victoria Barghout, MSPH; Kristijan H. Kahler, SM; Judith Bentkover, PhD; Hannah Kurth, BA; Ian M. Gralnek, MD, MSHS; and Brennan M. R. Spiegel, MD, MSHS
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Budget Impact of Tegaserod on a Managed Care Organization Formulary

Michael A. Bloom, BA; Victoria Barghout, MSPH; Kristijan H. Kahler, SM; Judith Bentkover, PhD; Hannah Kurth, BA; Ian M. Gralnek, MD, MSHS; and Brennan M. R. Spiegel, MD, MSHS

We sought to develop a budget impact model that assesses the economic effect of adding tegaserod for the management of irritable bowel syndrome (IBS) with constipation to the formulary of a managed care organization (MCO). The model estimates the per patient economic impact and the per member, per month (PMPM) economic impact of patients 6 months before and 6 months after the initiation of tegaserod. Resource utilization data, taken from medical and pharmacy administrative claims data, were based on a retrospective, longitudinal study of 3365 patients administered tegaserod through a large, geographically diverse MCO. Costs were estimated for 2 patient subgroups, women with IBS and other gastrointestinal (GI) diagnoses. Sensitivity analyses were performed by varying several model input parameters. The base-case model resulted in an incremental PMPM budget impact associated with the use of tegaserod of $0.01. Total per patient budget impact (for all resources, including tegaserod) for a 6-month period was $274.34 for women with IBS and $301.84 for women with other GI diagnoses. Overall, 25.9% (29.0% for women with IBS group and 21.9% for women with other GI diagnoses group) of the cost of tegaserod was offset by decreases in resource utilization. Key drivers of post-tegaserod reductions in resource costs were hospital stays, outpatient office visits, emergency department visits, endoscopic procedures, and nonendoscopic procedures. Tegaserod therapy can decrease GI-related resource utilization, resulting in a significant cost-offset percentage. When the associated budget impact of adding tegaserod to its formulary is absorbed across an entire MCO population, the PMPM impact of tegaserod is small.

(Am J Manag Care. 2005;11:S27-S34)

Irritable bowel syndrome (IBS) is characterized by symptoms of abdominal pain or discomfort associated with altered/disturbed bowel movements.1 IBS is highly prevalent, with estimates in the US general population ranging from 10% to 20%.2 Most people with IBS are women.3

Despite the large number of patients with IBS and the unpleasantness of its symptoms, only a small number of patients with IBS seek medical attention.4 Although the number of patients seeking treatment is small, IBS results in a considerable number of physician visits and pharmacologic treatments. Approximately 12% of patients who consult primary care physicians and 28% of patients who consult gastroenterologists are seeking help for symptoms of IBS.5

Aside from the physical and emotional toll, IBS results in a significant economic burden to society, with annual costs in the United States estimated by various studies to be $1.7 billion to more than $10.5 billion in direct medical costs (excluding prescription and over-the-counter drug costs) and $20 billion for indirect costs,6 which result from decreased productivity at work and school.7,8 The economic impact of IBS is similar to or higher than that of other long-term conditions, such as hypertension, asthma, Crohn's disease, chronic liver disease, and cirrhosis.9,10

Health status and health-related quality of life (QOL) of patients with IBS are poor compared with those of the general population.11-15 Furthermore, several studies have shown that the health-related QOL of patients with IBS is similar to or lower than that of patients with other debilitating conditions, such as gastroesophageal reflux disease, asthma, migraine, diabetes mellitus, and end-stage renal disease.14,16

Although most patients with IBS with constipation (IBS-C) are initially treated with fiber supplements and other nonpharmacologic therapies,17 many do not achieve adequate clinical response to these treatments.3 Alternatives to fiber supplements are now available for the treatment of IBS. A relatively newer agent to join the armamentarium of therapies to treat gastrointestinal (GI) motility disorders is tegaserod maleate, a 5-hydroxytryptamine type 4 (5-HT4) receptor agonist. Tegaserod maleate is the only US Food and Drug Administration-approved agent for the treatment of women with IBS-C and for the treatment of patients (men and women) younger than 65 years of age who have chronic idiopathic constipation. Tegaserod demonstrates clinical efficacy in reducing symptoms associated with IBS-C, including abdominal pain, bloating, and infrequent bowel movements. Tegaserod has a favorable safety and tolerability profile and has demonstrated efficacy in providing global symptom relief.18,19

Demonstration of clinical efficacy in patients with IBS is arguably the most important criterion used by physicians and payers, such as managed care organizations (MCOs), when selecting a particular therapy. Intense scrutiny has recently been placed on MCOs with regard to coverage for select therapeutic areas. In part because of this new development, several studies have been conducted to demonstrate the overall economic impact associated with IBS.20,21 To date, however, no study has considered the potential budgetary impact of introducing tegaserod therapy to an MCO formulary. Therefore, we sought to develop a budget impact model in an MCO to compare GI-related resource utilization and costs 6 months before and after the initiation of tegaserod therapy for tegaserod users and nonusers. We hypothesized that the increased costs of tegaserod compared with alternative therapies would be partially offset by downstream savings related to a decrease in GI-related resource utilization engendered by the effectiveness of tegaserod.

Methods

Model Structure. The budget impact model was developed to simulate the 6-month budgetary impact of adding tegaserod to an MCO formulary. The model estimates results for 2 patient subgroups based on patient diagnosis: women with IBS and other GI diagnoses, which include abdominal pain, intestinal disorders, GI/digestive disorders, liver/pancreatic disorders, GI surgical disorders, and GI cancer.

This budget impact model takes the simple approach of estimating the costs of the women with IBS and other GI diagnoses group before the introduction of tegaserod and the costs of women with IBS and other GI diagnoses after the introduction of tegaserod. Costs before the introduction of tegaserod were considered the burden of illness of the group of women with IBS and the other GI diagnoses group and were estimated by combining the relevant resource utilization with the costs of those resources. To determine the costs of women with IBS and GI diagnoses after the introduction of tegaserod, the burden of illness of women with IBS and GI diagnoses was adjusted by the relative impact of tegaserod on those resources.

Resource Utilization Study. Data to populate the model came from a retrospective, longitudinal resource use study of patients administered tegaserod from a large, geographically diverse MCO covering 14 million lives; medical and pharmacy administrative claims data were used to identify such patients from August 1, 2002 (launch of tegaserod), through June 30, 2003.22 The resource utilization study population consisted of 3365 patients taking tegaserod and compared the relative GI resource utilization in the 6 months after tegaserod initiation with that in the 6 months before tegaserod initiation.

Patient Population. In the budget impact model, we used a default patient population of 10 million as determined by data from the MCO that conducted the resource utilization study.

Prevalence of IBS in Women and of Other GI Diagnoses

We defined the prevalence of IBS in women as the proportion of covered lives of women who had a diagnosis of IBS. We defined the prevalence of the other GI diagnoses subgroup as the proportion of covered lives of patients with other GI diagnoses, excluding those in the women with IBS subgroup. Prevalence rates from the aforementioned resource utilization study were 1.2% for the women with IBS subgroup and 26.7% for the other GI diagnoses subgroup, based on the observed MCO prevalence rates,22 which became the default values in the budget impact model.

For both patient subgroups, we defined the tegaserod treatment rate as the proportion of women with IBS or other GI diagnoses patients who received at least 1 prescription for tegaserod. Again, based on observed MCO treatment rates,22 we used an estimated tegaserod treatment rate of 2% for the women with IBS subgroup and 0.1% for the other GI diagnoses subgroup in the model.

We selected pharmacy and nonpharmacy resource utilization categories based on a previous classification scheme used by Longstreth and colleagues.23 Categories and individual items were specified in an a priori manner without knowledge of the actual information in the medical and pharmacy database. The final medical resource categorization selection was reviewed, revised, and approved by an advisory team of specialists with experience in gastroenterology, functional GI disorders, and health services research.

Information on the relative impact of tegaserod on GI-related resources was obtained from the resource utilization study that assessed the following outcomes: physician office visits, hospitalizations, emergency department visits, endoscopic and nonendoscopic procedures and GI medications (IBS drugs, inflammatory bowel disease drugs, proton pump inhibitors [PPIs], promotility agents, ulcer drugs, antispasmodics, H2 antagonists, antidiarrheals, and laxatives). Any medical resource utilization category that showed use of less than 5 per 1000 patients was considered too unstable for inclusion in the model and was set to zero.

Costs. GI-related costs for the categories of service listed above were determined by using the resource-based relative value scale for professional services and gap codes (part of the resource-based relative value scale) for services not requiring physician intervention. Inpatient costs were determined using the 2003 payment reference average national payments rates for diagnosis-related groups, and drug costs used a 20% discount of the average wholesale price for costs.24

The cost of tegaserod was based on actual utilization in the MCO. A mean of 2.27 prescriptions was filled by patients per 6 months of follow-up, with a mean of 68 days' supply.22

Budget Impact Model Analyses. The model was developed from the perspective of an MCO. The time horizon considered for this analysis was 6 months; therefore, dollar values were not discounted. For each patient subgroup (women with IBS and other GI diagnoses), the 6-month per patient budget impact attributable to tegaserod was calculated by subtracting the post-tegaserod introduction pharmaceutical and medical GI-related costs from pre-tegaserod introduction per patient costs.

We calculated the per member, per month (PMPM) budget impact by dividing the 6-month per patient budget impact by 6, multiplying the resultant PMPM budget impact by the number of patients, and dividing by the total number of members.

We calculated a cost-offset percentage for both patient subgroups by dividing the total 6-month impact in non-tegaserod resource utilization costs by the 6-month per patient cost of tegaserod. The cost-offset percentage represented the percentage of tegaserod costs that can be offset by reductions in other resource utilization.

Sensitivity Analyses. We performed sensitivity analyses varying the inputs in the model to observe their effects on the total cost PMPM and the tegaserod cost-offset percentage.

Results

Budget Impact Analysis. The pretegaserod introduction of nonpharmaceutical, GI-related resource utilization default values are presented in Table 1.

Figure

In the budget impact model, the default 6-month cost of tegaserod was $386.44 per patient (Table 2). The total per patient budget impact (for all resources, including tegaserod) for a 6-month period was $274.34 for women with IBS and $301.84 for other GI diagnoses. This translated to a PMPM budget impact of $0.01 for each patient group (Table 3).

Figure

Figure

 
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