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When is the Cost of Care Worth it?

New medical technologies to treat chronic disease are typically accompanied by increases in both health care costs and health outcomes: while treatment costs have continuously increased over the years, the value of those treatments have not always shown the same growth in measured benefits. This disconnect influences policy, as policymakers rarely see measures of net costs that incorporate these outcomes. Darius Lakdawalla, Quintiles Chair in Pharmaceutical Development Regulatory Innovation at the Schaeffer Center and the USC School of Pharmacy, and his team of researchers, presented a quality-adjusted cost-of-care framework to measure increases in healthcare costs offset by the value of improved health outcomes. The research was published in the April 2015 issue of Health Affairs.

Examining Treatment Costs Through a Quality-Adjusted Framework

Quality-Adjusted Framework

As a proof of concept, Lakdawalla and co-authors apply the quality-adjusted cost of care framework to case studies of colorectal cancer and multiple myeloma. The case studies provide insight into important outcomes and allow for considerations beyond increases in financial cost which policymakers should be aware of.  This informational brief provides an overview of the quality-adjusted framework Lakdawalla presents and the applied case studies.

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