calculating and leveraging rois in tobacco control

Calculating and Leveraging

ROIs in Tobacco Control

2016-2017 TCN Podcast Series

Andrea Mowery, ClearWay Minnesota

Jeffrey Fellows, Kaiser Permanente Center for Health Research

Barry Sharp, Texas Department of State Health Services

Meg Riordan, Campaign for Tobacco-Free Kids

Kaiser Permanente

Research

© 2013, KAISER PERMANENTE CENTER FOR HEALTH RESEARCH © 2013, KAISER PERMANENTE CENTER FOR HEALTH RESEARCH

Kaiser Permanente

Research

Return on Investment from Tobacco Cessation

Jeffrey L. Fellows, PhD

Senior Investigator and health economist

Kaiser Permanente Center for Health Research

Portland, OR

Email: [email protected]

Kaiser Permanente

Research


Kaiser Permanente

Research

Defining the return on investment (ROI) from tobacco control programs

• ROI is a financial measure of the net savings (or costs) from an investment in a revenue generating activity

• Presented as a percent (%) • ROI = [(revenue – cost)/cost] x 100

• Used differently in healthcare program evaluations • ROI % doesn’t related well to health outcomes (program size/impacts)

• ROI adds future spending to program evaluation

• Reflects a need to make a “Business Case” for program investments

Kaiser Permanente

Research


Kaiser Permanente

Research

Economics of treatment: What do we know?

• Costs of smoking are high (Source: CDC)

• 480K premature deaths attributed to smoking, each year

• $170b healthcare costs/$150b lost productivity, each year

• Clinical cessation services are cost-effective

• The gold standard for preventive services (Eddy, 1992)

• $1,000-$3,500 per life year saved ($500–$2,000 per quit)

• More services lead to more quitting

• Best: Multi-session quit coaching with medications (USPHS, 2008)

• Community interventions are cost-effective • State quitlines (with and w/o NRT)

• Comprehensive tobacco control program spending: CA; MA; TX; MN

• Not enough

Kaiser Permanente

Research


Kaiser Permanente

Research

The business case for clinical smoking cessation

• Demonstrate the value of smoking cessation • High cost of smoking & favorable CEA are not enough

• Need near-term results (3-5 years)

• ROI (net financial costs/savings) key to “Business Case”

• Challenges • Limited longitudinal data for smokers and quitters

• Current smokers seem cheap

• Former smokers seem expensive

• Quitters may leave before savings occur

Kaiser Permanente

Research


Kaiser Permanente

Research

Business Case-ROI Study

• Test 4 system-level interventions • 5 As, w/ and w/o Rx and quitline

• Compared to existing practice (2 As)

• 1-year program, 5-year follow-up

• Longitudinal cohort model • EMR for 200K KPNW adults

• Data for 1998-2002

• Smoking history, SRD Dx, disenrollment

• medical costs and productivity

• Unique approach (w/smoking data) • Timing of Disease and self-quitting

• Disenrollment, by smoking and disease status

• Future $’s for healthy service recipients

• Funded by Robert Wood Johnson Foundation

Kaiser Permanente

Research

© 2013, KAISER PERMANENTE CENTER FOR HEALTH RESEARCH

Mean annual medical expenditures for KPNW adults,

by smoking status–1998-2002 (2007$)

Baseline expenditure data

Continuing

Smoker

Quit in

1998

Former

smoker

Never

smoker

1998 $3,581 $10,392 $7,278 $3,351

1999 $3,994 $9,206 $8,792 $3,591

2000 $4,177 $7,355 $9,951 $4,047

2001 $4,504 $7,703 $11,590 $4,529

2002 $5,281 $8,054 $10,934 $4,702

Estimates are weighted for age and sex, and reflect disenrollment. Generalized Linear Modeling (SAS PROC GENMOD) was used to assess costs. Values sign. at p<.001.

Kaiser Permanente

Research


Mean expenditures before/after quitting (in 1999) for KPNW

smokers, by smoking-related disease (SRD) status

0

2,000

4,000

6,000

8,000

10,000

-8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8

Q uarter Pre/Post Q uit Q uarter

Av

era

ge

Co

st (

20

02

$)

Pre-Existing SRD

SRD in 1999

SRD after 1999

No SRD

SRD=smoking

related

disease

Kaiser Permanente

Research


Quarterly mean RX cost for 1999 KPNW quitters before and after quitting, by SRD status

0

100

200

300

400

500

-8 -7 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 6 7 8

Quarter Pre/Post Quit Quarter

Aver

age

Cost

(2002$)

Pre-Existing SRD

SRD in 1999

SRD after 1999

No SRD

Kaiser Permanente

Research


Male Female

Quit rate 18-34 35-64 65+ 18-34 35-64 65+

No SRD

Heavy smoker .03 .03 .04 .04 .04 .05

Light smoker .04 .04 .05 .04 .05 .06

SRD

Heavy smoker .10 .10 .13 .11 .12 .15

Light smoker .12 .13 .16 .14 .15 .18

Annual probability of quitting by SRD diagnosis, amount smoked, sex, and age group

Estimates derived using multiple logistic regression modeling. All values were significant at p<.01.

Kaiser Permanente

Research


Disenrollment rates by smoking status, smoking-related disease (SRD) diagnosis, and age group

18-34 35-64 65+

Current smokers

No SRD Heavy .20 .09 .03

Light .24 .12 .04

SRD Heavy .12 .05 .02

Light .15 .07 .02

New Quitters

No SRD Heavy .15 .07 .02

Light .18 .09 .03

SRD Heavy .08 .04 .01

Light .11 .05 .02

Estimates derived using multiple logistic regression modeling. All values are significant at p<.001. Four-year average rates, 1999-2002.

Kaiser Permanente

Research


Current

Smoker

SRD Dx

(yes/no)

Quit

(yes/no)

Disenroll

(yes/no)

SRD Dx

(yes/no)

SRD Dx

(yes/no)

SRD Dx

(yes/no)

New

Quitter

Relapsed

Relapse

(yes/no)

Disenroll

(yes/no)

Disenroll

(yes/no)

Cessation

service

recipient

Quit

(yes/no)

Smoking Cessation Program*

Existing Practice

Return on Investment Model Flow Diagram for Years 1-5

*Provided to smokers at a routine care visit.

$s

$s

$s

Kaiser Permanente

Research


5A’s 5A’s-Rx 5A’s-QL 5A’s-both

Reach*

No copay

Copay

9.6 - 13.6%

4.8 - 6.8%

9.6 - 13.6%

4.8 - 6.8%

7.7 - 10.9%

3.9 - 5.4%

7.7 - 10.9%

3.9 - 5.4%

Q rate 16% 26.9% 19.2% 29.2%

Cost/ppt† $34 $350 $206 $410

*Reach based on % with a visit, 75% ask/advice, 46% ready to quit, 50%-40% regimen acceptance. Data vary somewhat by age and sex. †Participants include all counseled patients, incl. those receiving 5As who would have rejected the full regimen. Costs include physician time, overhead, NRT and QL services, and clinical training costs. Sources: Fiore et al., 2000; Hollis, 2001; USDHHS, 2001; AMA, 2003; Peden and Baker, 2002

Intervention reach, efficacy and costs

Kaiser Permanente

Research


Cumulative health plan ROI per member per month (PMPM)

by intervention, no member copay

5 A’s

5 A’s +

NRT

5 A’s +

Quitline

5 A’s +

Both

Program cost $445K $1,389K $1,043K $1,799K

PMPM $0.20 $0.62 $0.47 $0.80

ROI PMPM

Year 1 $ (0.11) $ (0.56) $ (0.43) $ (0.75)

Year 2 $ 0.97 $ 0.43 $ 0.63 $ 0.23

Year 3 $ 1.72 $ 1.17 $ 1.38 $ 0.97

Year 4 $ 2.28 $ 1.74 $ 1.94 $ 1.54

Year 5 $ 2.48 $ 1.96 $ 2.14 $ 1.77

Incremental ROI compared to existing practice (2 As) in discounted 2007 dollars.

Sensitivity Analysis: Changing disenrollment, reach, efficacy, and SRD rates affected the ROI estimates but not the conclusions.

Kaiser Permanente

Research


Cumulative health plan ROI per member per month (PMPM)

by intervention, with member copay

5 A’s

5 A’s +

NRT

5 A’s +

Quitline

5 A’s +

Both

Program cost $445K $846K $674K $1,051K

PMPM $0.20 $0.37 $0.26 $0.42

ROI PMPM

Year 1 $ (0.11) $ (0.31) $ (0.23) $ (0.37)

Year 2 $ 0.97 $ 0.75 $ 0.87 $ 0.69

Year 3 $ 1.72 $ 1.50 $ 1.63 $ 1.44

Year 4 $ 2.28 $ 2.07 $ 2.19 $ 2.00

Year 5 $ 2.48 $ 2.27 $ 2.38 $ 2.21


Sensitivity Analysis: Changing disenrollment, reach, efficacy, and SRD rates affected the ROI estimates but not the conclusions.

Kaiser Permanente

Research


Cumulative health plan ROI per member per month (PMPM) by

intervention, worst case scenario*

5 A’s

5 A’s +

NRT

5 A’s +

Quitline

5 A’s +

Both

Program cost $917K $1,861K $1,515K $2,271K

PMPM $0.41 $0.83 $0.68 $1.01

ROI PMPM

Year 1 $ (0.34) $ (0.77) $ (0.64) $ (0.37)

Year 2 $ 0.67 $ 0.15 $ 0.39 $ (0.05)

Year 3 $ 1.33 $ 0.79 $ 1.06 $ 0.58

Year 4 $ 1.71 $ 1.17 $ 1.44 $ 0.96

Year 5 $ 1.80 $ 1.26 $ 1.54 $ 1.06


*Doubled disenrollment, low intervention efficacy, 15% discount rate, and $400K added for provider incentives to meet delivery targets.

Kaiser Permanente

Research


Kaiser Permanente

Research

Conclusions from the Business Case Study

• Cost of doing nothing is high

• Cessation saves money in near-term

• ROI results are stable across a wide-range of inputs

• Disenrollment is key, not in expected way

• Sick quitters: costly and stay in the health plan

• Healthy quitters more likely to stay vs. continuing smokers

• Key messages

• More to fear from sick quitters who stay, than health quitters who leave

• Helping patients quit is good business

Campaign for Tobacco-Free Kids www.tobaccofreekids.org

Demonstrating the Value of Tobacco Prevention Programs

2

Meg Riordan

Campaign for Tobacco-Free Kids


Projecting the Impact of Changes to Program Funding and Smoking Declines

3


Benefits & Savings From Each Percentage Point Decline in Smoking

4


Customizable Slides: State Tobacco Prevention Spending vs. Total Tobacco Revenue

5

$0

$100

$200

$300

$400

$500

$600

Total State TobaccoRevenues

CDC Recommended AnnualInvestment

Actual State TobaccoPrevention Spending

$388.6 Million Estimated Tobacco

Tax Revenues

$165.3 MillionEstimated Tobacco

Settlement Revenues

$553.9 million

$48.0 million

$10.6 million

millio

ns

Maryland

Maryland spends 1.9% of

its tobacco revenues on

tobacco prevention

programs


66

Tobacco companies

are outspending

state tobacco

prevention spending

$189 to $1

millio

ns

$299.4 million

$1.6 million

Customizable Slides: State Tobacco Prevention Spending vs. Tobacco Industry Marketing

Michigan

$0

$50

$100

$150

$200

$250

$300

$350

Tobacco Industry Marketing Spending Tobacco Prevention Spending


$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

Tobacco-Related HealthcareCosts

Tobacco Prevention Spending

Customizable Slides: State Spending vs. Health Care Costs

7

Ohio

7

$13.5 million

$5.64 billion

billio

ns


State Spending Infographic

8


Key Messages for Tobacco Prevention

9


10

Campaign for Tobacco-Free Kids Website

http://www.tobaccofreekids.org/f

acts_issues/fact_sheets/policies/

prevention_us_state/

http://www.tobaccofreekids.org/facts_issues/fact_sheets/policies/prevention_us_state/


Summaries of the Evidence on Website

11

http://www.tobaccofreekids.org/facts_issues/fact_sheets/policies/prevention_us_s

tate/save_lives_money/

http://www.tobaccofreekids.org/facts_issues/fact_sheets/policies/prevention_us_state/save_lives_money/


Annual State Report on State Tobacco Prevention Spending

12tfk.org/statereport

http://www.tobaccofreekids.org/microsites/statereport2017/


Meg RiordanVice President, Research

Campaign for Tobacco-Free Kids202.296.5469

[email protected]

13

mailto:[email protected]

calculating and leveraging rois in tobacco control

Documents