Implications of real world data

Breaking New Ground with RWE

Some decades ago evidence based medicine was the key issue in understanding effectiveness in health care and drugs. Right now the new term is Real World Evidence. You'll not find it in the wikipedia, instead I would suggest you look at this IMS report:

RWE is drawn from robust anonymous patient-level data using sound scientific and commercial analytics. It is not about amassing "Big Data" so much as performing targeted analyses on ever expanding healthcare datasets.
While RWE is known to complement data from Randomized Clinical Trials (RCTs), its real potential is in moving decisions away from perceptions and broad extrapolations to the actual facts about patient journeys and outcomes. With innovations in data and technology, RWE is replacing other information sources such as non-behavioral primary market research (PMR), standard market reports, consumption/market data purchases, observational studies, and even selected spending on RCTs.

Its impact could be large if drug prescription decisions and pricing takes into account the outcomes from the "patient journey" as they say. This is a new paradigm with uncertain spillovers. The true evidence based medicine with the power of big data. We must be aware of it and follow it closely.

PS. How to introduce innovative medicines?. Have a look at this workshop.

Organising genetic testing

Finally the government has decided to organise genetic counseling and testing. A recent instruction determines who does what. As you may remember I've said several times that government was on permanent holiday on this issue.
In this new instruction, at least two issues are forgotten: the tests that are covered, and the proliferation of sequencing instruments outside the lab. These are not minor issues.
Somebody should decide asap wether a test it is worth to be prescribed. Right now, there are no explicit constraints under the current instruction. And DNA sequencing instruments may be found in many departments under the consideration of research. If there is no clear split between research and care, I can imagine a close future with many messy labs within any hospital. Concentration of knowledge and specialisation provides wider guarantees for quality. Unless there is any mentorship program by clinical laboratories, things will go down the wrong path. Today I'm more worried than yesterday, unless these two issues are fixed.

Changing health behavior (once again)

World Development Report 2015: Mind, Society, and Behavior

Understanding human behavior is one of the main scientific endevours of our current times. As I have explained before, psychology, economics and neurosciences are making great progress in the last decades. Now the annual report by the World Bank puts all this stuff in one publication:

Three principles stand out as providing the direction for new approaches to  understanding behavior and designing and implementing development policy. First, people make most judgments and most choices automatically, not deliberatively: we call this “thinking automatically.” Second, how people act and think often depends on what others around them do and think: we call this “thinking socially.” Third, individuals in a given society share a common perspective on making sense of the world around them and understanding themselves: we call this “thinking with mental models".

In chapter 8 you'll find the application to health issues. A clear warning:

Telling people that there is a way to improve their health is rarely sufficient to change behavior. In general, successful health promotion campaigns engage people emotionally and activate or change social norms as much as they provide information. The message disseminated should be that others will support you or even applaud you if you do it, not just that something is good for you. Successful campaigns address many or most of the following: information, performance, problem solving, social support, materials, and media . A campaign should tell people that a behavior will improve their health (information), demonstrate and model the behavior (performance), reduce barriers to its adoption (problem solving), create a system for supporting people who choose to adopt it (social support), provide the materials necessary to begin adoption (materials), and provide a background of support through in-person, print, radio, television, and other approaches (media).

As you may imagine, this is much more difficult than simply giving information. This is precisely the greatest challenge.

Health across borders

Let's think of two countries artificially separated by political borders. Both have the same income per capita (~27,700 €) and belong to the EU. The first spends 11.1 % of GDP on health (5,513€ per capita, 77.7% public funding), while the second only 8% (3,898€ per capita, 65.8% públic funding).
Both countries have roughly the same life expectancy at birth. Healthy life expectancy at 65 is better in the country that spends less. The number of visits and hospitalizations is also less. Physicians are also paid less, 18% less in general practitioners income, up to 40% in specialists income.
There is only one border between them, an artificial border created by a treaty to end a war that lasted 30 years. This is the case of part of France and Catalonia. While the first can decide over the size of resources devoted to health, the second has no role on it, by now.

PS. Today at COMB, French health reform. I'll be there. #sanitatfrança

The value of vaccination

Valuing vaccination

A PNAS article sets a broader perspective on valuing vaccines. It is of interest in light of current difteria case. My position is clear, no doubt about mandatory vaccination if its cost-effectiveness is proven.
Suggestions from the article:

Three general recommendations flow from our arguments and related synthesis of existing evidence on broad benefits of vaccination. First, many economic evaluation studies of vaccinations should be redone to capture the full benefits generated by the vaccination in question. Second, the evidence to date on the full value of vaccination has been focused on measuring the total social benefits generated. It would also be useful to explore the distribution of vaccination’s benefits among different possible beneficiaries. Third, the primary empirical evidence on broad vaccination benefits will need to be considerably expanded and improved

Framework of vaccination benefits

Perspective		Benefit categories	Definition
Broad	Narrow	Health care cost savings	Savings of medical expenditures because vaccination prevents illness episodes
		Care-related productivity gains	Savings of patient’s and caretaker’s productive time because vaccination avoids the need for care and convalescence
		Outcome-related productivity gains	Increased productivity because vaccination improves physical or mental health
		Behavior-related productivity gains	Vaccination improves health and survival, and may thereby change individual behavior, for example by lowering fertility or increasing investment in education
		Community health externalities	Improved outcomes in unvaccinated community members, e.g., through herd effects or reduction in the rate at which resistance to antibiotics develops
		Community economic externalities	Higher vaccination rates can affect macroeconomic performance and social and political stability
		Risk reduction gains	Gains in welfare because uncertainty in future outcomes is reduced
		Health gains	Utilitarian value of reductions in morbidity and mortality above and beyond their instrumental value for productivity and earnings

 

Reviewing the residency system

Let Me Heal. The Opportunity to Preserve Excellence in American Medicine

We usually emphasize the level of resources when we assess the results of our health system. Institutions matter, we already know that. And if there is one key success factor in our healthcare is the physician's residency program. Training of the physicians under "real" conditions has allowed substantial improvements in health outcomes and the progress of medicine that are difficult to measure specifically. In a new book, Ludmerer provides an excellent review of what it represents to US healthcare:

At the core of the residency system are fundamental educational principles: the assumption of responsibility by residents in patient management, and the importance of providing residents sufficient time to reflect and pursue subjects in depth. Also at the core are the moral principles of residency training: thoroughness, attention to detail, and learning that the needs of patients should come first

And considers that

The current turmoil in health care delivery offers the profession and public the opportunity to redesign medical education and practice in ways that more fully serve the needs of patients, present and future.  The opportunity is there to envision medical education and practice as they should be, not as they are,  and to work toward achieving that end. Such opportunities are to be treasured, not feared. The country will always need good doctors, and the medical profession has little to fear in the changes ahead as long as it remembers that it exists to serve, that the needs of patients come before its own, and that it always must be thinking of improving the future as well as caring for the present.

This call for a redesign of medical education and practice is a real need in our environment. The confusion between the role of  "student" and "employee" is increasing and there is no effort to clarify it.The number of physicians in the program is determined without any clear estimation of demand and rules. A total mess. That's why I consider that we should rethink it from its foundations.

PS. Must see. Documentary: Big Data, citizens under scrutiny.

Integrated care and population health

Population health Systems: Going beyond integrated care

In this blog I have mentioned several times the works by Kindig on population health. If integrated care makes sense, it is because it improves population health. Otherwise we should talk about diferent things.
A new report by the King's Fund sheds some light on several experiences of integrated care. It's worth reading, because you'll see that there is not only one way to achieve the final goal, and the tool -better coordination- has to be suited to the specific setting.

The "recipe":

At a practical level, developing a population health systems perspective requires the following elements as a minimum:
• pooling of data about the population served to identify challenges and needs
• segmentation of the population to enable interventions and support to be targeted appropriately
• pooling of budgets to enable resources to be used flexibly to meet population health needs, at least between health and social care but potentially going much further
• place-based leadership, drawing on skills from different agencies and sectors based on a common vision and strategy
• shared goals for improving health and tackling inequalities based on an analysis of needs and linked to evidence-based interventions
• effective engagement of communities and their assets through third sector organisations and civil society in its different manifestations
• paying for outcomes that require collaboration between different agencies in order to incentivise joint working on population health.

FT on cancer drugs pricing

Being aware of what's going on in marijuana market

Waiting for the opportune moment: the tobacco industry and marijuana legalization

Is it possible to prevent another public health catastrophe similar to tobacco use?. This is the question posed by a recent article in Milbank Quarterly related to marijuana legalization. They explain with complete details how:

Since at least the 1970s, tobacco companies have been interested in marijuana and marijuana legalization as both a potential and a rival product. As public opinion shifted and governments began relaxing laws pertaining to marijuana criminalization, the tobacco companies modified their corporate planning strategies to prepare for future consumer demand.

And their conclusion is clear:

Policymakers and public health advocates must be aware that the tobacco industry or comparable multinational organizations (eg, food and beverage industries) are prepared to enter the marijuana market with the intention of increasing its already widespread use. In order to prevent domination of the market by companies seeking to maximize market size and profits, policymakers should learn from their successes and failures in regulating tobacco.

If this is so, why does nobody care about it?. Why aren't health politicians taking decisions in the right direction?. I strongly suggest them reading this article based on the documents of the tobacco industry and act accordingly.

What's still wrong in economics (and health economics) research

Some weeks ago I was posting on "Evidence-based economics going mainstream" , in fact the title was only taken from the book by Thaler and it is strictly a desideratum. Unfortunately what we are used every week in the university seminars is more related to Chicago style economics: Optimization +Equilibrium = Economics.
The struggle to bring academic discipline back down to earth is an unfinished business. Let's take for example this paper: Can Health Insurance Competition Work? Evidence from Medicare Advantage. The author achieves this conclusion:

We estimate that private plans have costs around 12% below fee-for-service costs, and generate around $50 in surplus on average per enrollee-month, after accounting for the disutility due to enrollees having more limited choice of providers. Taxpayers provide a large additional subsidy, and insurers capture most of the private gains.

Is this a conclusion?. What are the gains? Monetary gains? Does it make any sense to compare an outdated system like fee-for service with another outdated one such as "managed competition"?
Improving health is the goal, and nobody can answer to this question with this methodologic approaches. Understanding the bounded rationality, heuristics and biases of individuals is fundamental to assess any policy. As Thaler says in his book:

Moreover, much of what economists do is to collect and analyze data about how markets work, work that is largely done with great care and statistical expertise, and importantly, most of this research does not depend on the assumption that people optimize. Two research tools that have emerged over the past twenty-five years have greatly expanded economists’ repertoire for learning about the world. The first is the use of randomized control trial experiments, long used in other scientific fields such as medicine. The typical study investigates what happens when some people receive some “treatment” of interest. The second approach is to use either naturally occurring experiments (such as when some people are enrolled in a program and others are not) or clever econometrics techniques that manage to detect the impact of treatments even though no one deliberately designed the situation for that purpose. These new tools have spawned studies on a wide variety of important questions for society.

There is a long way forward in economic (and health economics) research.

PS. It's not a surprise that they have forgotten a key paper on the topic by R. Frank.

PS. Must see:

 

The exhibition Barcelona Haggadot reunites for the first time in more than six centuries an extensive selection of these splendid works of the Catalan Gothic period that were dispersed around the world when the Jews were expelled.

Barcelona, the seat of a monarchy and a hub of Mediterranean trade, had an urban ethos that was receptive to the most innovative artistic influences in the opening decades of the 14th century. At this juncture in the Gothic era, the city’s workshops constituted a highly active centre for the production of Haggadot, manuscripts that contain the ritual of the Passover meal, which were commissioned by families living in the Call (Jewish quarter) in Barcelona and in other Jewish communities. Jews and Christians alike worked on Haggadot and shared the same style and iconographic models.

PS. Victor Grifols has recently deceased. This obituary explains clearly his commitment with health, ethics and business. RIP

Alcohol use and abuse

Tackling Harmful Alcohol Use

Tha last OECD report is focused on health impact of alcohol and what should we do to avoid harmful effects. Key findings are the following ones:

• Alcohol use has both beneficial and detrimental effects on the health of individualdrinkers. At the population level, the latter outweigh the former in all countries.
• The risk of death for young male adults and young and middle-aged women increasessteadily with alcohol consumption, with no beneficial effects overall, but with relatively
• Approximately four in five drinkers would reduce their risk of death from any causes ifthey cut their alcohol intake by one unit (10 grams) per week.
• Measures of the health benefits and harms associated with alcohol use may need to
•  Life years potentially gained, quality of life and individual preferences over the timing ofoutcomes are important elements in the analysis of policy options.
• Alcohol policies have to balance welfare benefits and losses. Harms to people other than drinkers are more effectively reduced by tackling heavy drinking. Price and regulation policies are more likely to affect consumer welfare.
• Harms to others, addiction, and consumers’ inaccurate perception of risk provide strong justification for government action in addressing the problem of harmful alcohol use.

The last two statements are those that should shake politicians to develop some of the proposals contained in this report. 

An open mind on mental health

Fit mind, fit job. From Evidence to Practice in Mental Health and Work

The social and economic impact of mental illness requires a new approach. Conventional approaches to the disease are insufficient and a broad involvement of different stakeholders is needed. These are the premises that the OECD has drawn in its new report "Fit mind, job fit. From evidence to practice in mental health and work. " While in previous reports had tried to characterize the state of affairs, now he has been concerned to review successful strategies in different countries.
The total costs of mental illness represent around 3.5% of GDP in European countries. Of this, more than half corresponds to indirect and intangible costs. Among them are productivity losses, an aspect difficult to estimate because the phenomenon of "presenteeism" appears. In the case of mental illness, the fact of going to work despite illness is the rule (over 75%) .
The issue presents differential considerations for other diseases, especially its relationship with the job and productivity. There is evidence of less satisfaction, lower quality jobs and lower pay. All contribute to conditions of work under a mental illness represent a tension for the individual and for the company. And of course in the event of unemployment, even more.
Ssome countries have tried to deal with this situation from an interdisciplinary way. That is, strictly avoiding medicalized view of health policy and trying to involve the various actors in the field of business and social environment of the patient.
The OECD recommendations fall into four areas: youth and education, business, social services and employment and healthcare. Of these, I would like to highlight here those related to the firm, being the most neglected at present.
In the field of business, strategies for supporting employees with mental health problems are crucial to achieve a positive development that avoids the end a loss of jobs and a worsening of the disease. The initial issue to consider is the detection of the problem. Somehow, managers and immediate supervisors need to provide a suitable response to the situation and often do not have the knowledge and training needed. The British example known as "Mental Health First Aid program" is a tipping point to keep in mind despite his limited success in small and medium enterprises.
The adoption of risk prevention strategies also seeks to provide tools to improve psychosocial job conditions. To this, a change of perspective in occupational medicine could contribute decisively.In cases of injury, the management of return to work eventually becomes critical for improving the stage of the disease process. To the extent that the long absences are more complex to address, it is precisely these that require attention consistently. The option of gradual return to work and support by colleagues has proven effective in this regard. The search for a negotiated solution brings more satisfactory exit routes for the disease, the conflict. And finally there are the incentive strategies and the legal obligations of employers in this regard. How to address long-term absenteeism it is a challenge in all countries and there is no rècipe for all cases. Must be combined with adequate monitoring incentives to return to the job.The uniqueness of mental illness is that the successful approach is the one that allows redevelopment activities in the labor and social environment properly. To do this, a modern approach requires among other things that the company and its employees are aware of and responsible for a different perspective and fully involved. In this direction, government and business associations should join hands to tackle an issue that so far we thought belonged only to the health system. The relevance of mental health and its impact on the welfare of citizens and their families, requires a timely response.

The failure to find the laws of capitalism

The Rise and Decline of General Laws of Capitalism

Acemoglu and Robinson provide the best review - to my knowledge- of Piketty's work in a recent article. Their conclusion is widely shared by many people:

Thomas Piketty’s (2014) ambitious work proffers a bold, sweeping theory of inequality applicable to all capitalist economies. Though we believe that the focus on inequality and the ensuing debates on policy are healthy and constructive, we have argued that Piketty goes wrong for exactly the same reasons that Karl Marx, and before him David Ricardo, went astray. These quests for general laws ignore both institutions and politics, and the flexible and multifaceted nature of technology, which make the responses to the same stimuli conditional on historical, political, institutional, and contingent aspects of the society and the epoch, vitiating the foundations of theories seeking fundamental, general laws. We have argued, in contradiction to this perspective, that any plausible theory of the nature and evolution of inequality has to include political and economic institutions at the center stage, recognize the endogenous evolution of technology in response to both institutional and other economic and demographic factors, and also attempt to model how the response of an economy to shocks and opportunities will depend on its existing political and institutional equilibrium.

They offer an easy proof of the most salient Piketty failure: his inability to provide any correlation between the rate of growth of the economy and the real interest rate and its impact on inequality. Acemoglu and Robinson do that and no conclusions arise.

I do have the impression that confirmatory bias is working hard. I could say, I really believe really that Piketty has provided the argument that people wanted to hear. This is precisely the root of his success. You may read additional rationale in The Guardian. Unfortunately, there is no clear, easy and successful measure to tackle inequality - like taxing the rich, as he proposes- . I have already explained it in a former post.

Evidence-based economics going mainstream

Misbehaving. The making of Behavioral Economics

Once upon a time there was a scientific discipline created under the assumption that people choose by optimizing and that choices were rational (unbiased).

This premise of constrained optimization, that is, choosing the best from a limited budget, is combined with the other major workhorse of economic theory, that of equilibrium. In competitive markets where prices are free to move up and down, those prices fluctuate in such a way that supply equals demand. To simplify somewhat, we can say that Optimization +Equilibrium = Economics. This is a powerful combination, nothing that other social sciences can match.

All these core premises of economic theory began to be under scrutiny four decades ago, with the contributions of Kahneman and Tversky on Prospect Theory and what we call right now  "Behavioral Economics". Richard Tahler in his new book "Misbehaving. The making of Behavioral Economics" describes the whole history with the privilege of being on the forefront since the very begining. That's why this book is of interest. Last year another book appeared on the same topic, with a formal view: Behavioral Economics, a history. Thaler's book is of much more interest, though you can skip some details on anecdotes from several chapters. His focus on financial issues is understandable, as long as he has done most of this work in this area. However, other issues deserve more attention.
Anyway, a must-must read book. Just in the final chapter he focuses on changing the title, and he talks about evidence-based economics, rather than behavioral economics. For a health economist, this option sounds closer, since evidence-based medicine had a similar development four decades ago.

Much has changed. Behavioral economics is no longer a fringe operation, and writing an economics paper in which people behave like Humans is no longer considered misbehaving, at least by most economists under the age of fifty. After a life as a professional renegade, I am slowly adapting to the idea that behavioral economics is going mainstream. But the process of developing an enriched version of economics, with Humans front and center, is far from complete.

PS. NYT review.
PS. Misbehaving site.
PS. On Bitcoin creator: "some even suggest Nash could be Satoshi Nakamoto himself". Glups?

Hyperbolic discounting, forgotten once again

Lemons or Cherries? Asymmetric Information in the German Private Long-term Care Insurance Market

Is there adverse or advantageous selection in german private long-term care insurance market?. This is the question that addresses this article:

There are two predominant theories as to the effects of asymmetric information on the purchase of insurance. One theory, known as the “lemons principle”, concentrates on adverse selection, and suggests that high-risk agents choose to purchase more insurance coverage than do low-risk agents.1 A testable prediction of adverse selection theory is that risk occurrence is positively correlated with insurance coverage.
The second theory as to the effects of asymmetric information concentrates on advantageous selection. This theory is also called “cherry picking”.2 Advantageous selection stresses the role of individuals’ risk aversion and argues that more risk-averse agents are both more willing to purchase insurance and more cautious.3 In the presence of advantageous selection, insurance coverage and risk occurrence are negatively correlated.

The conclusion is:

Although individuals’ self-assessment of poor health predicts their future care needs very well, such assessments are not necessarily reflected in insurance demand.
The dominating effect of adverse selection in the German private LTC insurance market gives support to the conventional claim that asymmetric information distorts market efficiency and results in lack of insurance demand.

In fact, these results are irrelevant as long as the effect of hyperbolic discounting has not been taken into account. Therefore, although it has been published in a widely read journal, you can skip it without any implication.