Cost-effectiveness of full medicare coverage of angiotensin-converting enzyme inhibitors for beneficiaries with diabetes

Allison B. Rosen, University of Massachusetts Medical School
Mary Beth Hamel, Beth Israel Deaconess Medical Center
Milton C. Weinstein, Harvard School of Public Health
David M. Cutler, Harvard University
A. Mark Fendrick, University of Michigan Health Systems
Sandeep Vijan, Ann Arbor Veterans Affairs Medical Center

Abstract

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 USD saved per Medicare beneficiary). Compared with the new Medicare drug benefit, first-dollar coverage remained a dominant strategy (0.15 QALYs gained, 922 USD 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.