1. CADTH Guidance Document for the Costing Process – 2 nd edition CADTH SYMPOSIUM ANTHONY BUDDEN 13 APRIL 2015 SASKATOON, SK

2. Research Team Philip Jacobs, IHE Karen Lee, CADTH 1 Acknowledgements Researchers at CIHI Peer review from health economic/health services researchers

3. CADTH Cost Guidance document 2 Published in 1996 Useful resource for researchers Provides guidance on: o determining, measuring and valuing costs and resources for economic evaluations o Information sources o Reporting formats

4. Purpose of update to Cost Guidance document Evolution of cost information Provide researchers with description of different costing approaches Encourage increased uniformity and transparency in costing methods and information Highlight key sources of information NOT To duplicate information available elsewhere Canadian costing manual (Comprehensive list of sources) Definitive hierarchy of sources 3

5. Approach to update Collaboration between CADTH and IHE Working closely with researchers (CIHI, peer reviewers) Identifying new areas and need for revisions since 1996 o Literature review of economic evaluations in Canada o Scan of cost sources in Canada o Discussion with researchers in various cost fields in Canada o CDR experience 4

6. Key changes Structure of the document Costing categories and content Inclusion of examples More information in areas where developments have occurred (hospital costing) 5

7. Perspective Based on the decision problem Perspective will o Determine the types of costs to consider o Which data sources to use 6

8. Measurement and resource valuation – key sections for discussion 7 Pharmaceuticals (Prescription/ OTC drugs, Drug delivery devices/ monitoring tools, Drug administration) Physician Services Hospital Services (Inpatient services/ Outpatient services) Diagnostic and Investigational Services (Radiology, Laboratory tests and assays, Medical devices) Non-Physician Professional Services (physio, nursing) Community Based Services (Residential care, Home care, Ambulance services) Other Information (personal and societal cost information and public health services)

9. Hospital services Greater amount of information available Hospital services refer to services produced within a hospital on an inpatient or outpatient basis, and include nursing and other professional services, lab and diagnostic services, as well as dispensing and administration of drugs, housekeeping and nutrition o Physician services typically paid and costed separately 8

10. Hospital services – inpatient care 9 Inpatient hospital care: Levels of costing Inpatient hospital care: Levels of costing Per diem costing Case mix costing (basic CMG+ and refined CMG+) Patient costing on a case by case basis Simplistic In depth

11. Inpatient care – per diem costing 10 Per diem costing Simplistic approach Cost per inpatient day x hospital LOS Uniform cost for inpatient day Data sources: o Expected LOS for cases can be obtained from the CIHI discharge abstract database (DAD) o Cost per day obtained from CIHI

12. Inpatient care – case mix costing 11 Case mix costing (basic CMG+ and refined CMG+) CIHI collects inpatient discharge data from hospitals across the country on a common discharge abstract Data captured include: o Patient age o Sex o Diagnoses (ICD-10-CA) o Intervention/s Reports collated by CIHI in the DAD o Type of diagnosis (system of ranking) o MRDx identifies diagnosis responsible for longest portion of stay

13. Inpatient care – case mix costing Important concepts in case mix costing: 12 ConceptBrief description Case Mix Group (CMG)Similar cases grouped to determine average cost of case Resource Intensity Weight (RIW) Standardised estimate of expected resource use Cost of a standard hospital stay (CSHS; formerly CPWC) Inpatient costs for unit (hospital or province) are summed and divided by summed RIW for all cases

14. Inpatient care – case mix costing 528 CMGs RIWs are produced for each CMG The average case value = 1.00 RIW values for each CMG are subdivided by age and case type (typical/atypical) Base CMG+: cases measured unadjusted for comorbidities or additional comorbidities Refined CMG+: includes base values adjusted for comorbidities and additional interventions 13

15. Inpatient care – case mix costing Data sources: o RIWs obtained from CIHI DAD o CSHS obtained from CIHI Canadian MIS Database Other data sources – case mix based on pt cost estimates: o Alberta: IHDA, Ontario: OCCI Reported information differs Example: From a government payer perspective, a researcher in Ontario wants to estimate the hospital cost of a unilateral knee replacement for a 50 y.o.: o Base RIW & weighted average unadjusted CSHS for Ontario in 2012 (latest), cost is $7,978. o IHDA, relevant year (2012/13), desired measure, and all cases; cost is $10,263. Includes atypical patients, hence the higher cost o Phys fees/ rehab costs not included 14

16. Inpatient care – patient level costing 15 Patient costing on a case by case basis Patient costing on a case by case basis are generated from CIHIs CMDB Only available for certain hospitals within 4 provinces: Alberta, Ontario, BC and Nova Scotia. They may be directly obtained from provincial health departments

17. Inpatient care – costing summary ApproachStrengthsWeaknesses Applying a per diem cost to length of stay Provides a consistent measure over a historical period Does not distinguish between (higher cost) early days and later days of a stay Does not address differences in resource use between different types of cases Case mixAddresses differences in resource use between different types of cases Does not capture historical differences in resource use per case RIWs are hot hospital specific; based on data for a small number of hospitals Person levelAllows for more precise comparison between identified cases within a single diagnostic group Limited availability of data 16

18. Outpatient (ambulatory) care Non-admitted patient hospital visits which include diagnostic services, clinic care, outpatient surgery and ED visits Information captured within NACRS (overseen by CIHI) which feeds into CIHI’s CACS for outpatient care Note: Small number of hospitals in BC, ON, AB collect costs CIHI have estimates RIWs for CACS groups Care often includes physician intervention or consultation (counted separately from hospital facility component) Provincial outpatient data for Alberta and Ontario is made available on their patient cost tools: the IHDA and OCCI respectively 17

19. Community services – residential care 18 RAI-MDS 2.0 RUG (currently RUG-III) RUG (currently RUG-III) Data collected from residents on cognition, disability and care received Residential care is the joint provision of longer term accommodation and health care services in a facility

20. Residential care – RUGS Each RUG-III group is also assigned a Case Mix Index (CMI) that provides indication of average daily resource use for individuals in a particular group (available from CIHI) Data are summarised into quarterly RUG Weighted Patient Days (RWPD) reports which are available to certain Long- Term Care homes and facilities through CIHI’s eReporting portal, which is not currently accessible to the public Unit costs per RUG-III group are publicly available through Ontario’s Health System Performance Research Network – paper by Wodchis et al. 2013 19

21. Home care & ambulance services All provinces provide professional home care, but cost and utilization data are not easily obtainable Ontario’s HSPRN paper (Wodchis et al. 2013) estimated fees paid to professional home care visitors for a wide range of services by the government in Ontario Cost or fee directly obtained from province is suggested more appropriate The full cost of ambulance services throughout Canada is not well reported Full costs may be obtained from provincial or local ambulance services such as the Toronto EMS annual report 20

22. Challenges Common terminology/language Lack of publicly available information (e.g. RUGS, Ambulance services) Jurisdiction variation (e.g. pharmaceuticals, physician) Lack of agreement over accepted/appropriate methods (e.g. indirect costs) Difficult to have overarching guidance in some cases Requirement for further research, greater public access to information 21

23. Next Steps Finalize document: April 2015 Stakeholder feedback: May 2015 Posting of final document: Summer 2015 22

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