Abstract
Aims: Inflammatory bowel disease (IBD) (e.g. ulcerative colitis [UC] and Crohn’s disease [CD]) severely impacts patient quality-of-life. Moderate-to-severe disease is often treated with biologics requiring infusion therapy, adding incremental costs beyond drug costs. This study evaluates US hospital-based infusion services costs for treatment of UC or CD patients receiving infliximab or vedolizumab therapy.
Materials and methods: A model was developed, estimating annual costs of providing monitored infusions using an activity-based costing framework approach. Multiple sources (published literature, treatment product inserts) informed base-case model input estimates.
Results: The total modeled per patient infusion therapy costs in Year 1 with infliximab and vedolizumab was $38,782 and $41,320, respectively, and Year 2+, $49,897 and $36,197, respectively. Drug acquisition cost was the largest total costs driver (90–93%), followed by costs associated with hospital-based infusion provision: labor (53–56%, non-drug costs), allocated overhead (23%, non-drug costs), non-labor (23%, non-drug costs), and laboratory (7–10%, non-drug costs).
Limitations: Limitations included reliance on published estimates, base-case cost estimates infusion drug, and supplies, not accounting for volume pricing, assumption of a small hospital infusion center, and that, given the model adopts the hospital perspective, costs to the patient were not included in infusion administration cost base-case estimates.
Conclusions: This model is an early step towards a framework to fully analyze infusion therapies’ associated costs. Given the lack of published data, it would be beneficial for hospital administrators to assess total costs and trade-offs with alternative means of providing biologic therapies. This analysis highlights the value to hospital administrators of assessing cost associated with infusion patient mix to make more informed resource allocation decisions. As the landscape for reimbursement changes, tools for evaluating the costs of infusion therapy may help hospital administrators make informed choices and weigh trade-offs associated with providing infusion services for IBD patients.
Introduction
Inflammatory bowel disease (IBD) is a description for multiple chronic, relapsing inflammatory disorders that primarily affect the digestive system. The most well-known and frequently observed IBD conditions are ulcerative colitis (UC) and Crohn’s disease (CD). While the cause of these diseases is not known, they have been linked to genetic and environmental factorsCitation1. IBD severely impact patients’ quality-of-life, causing frequent inconvenient and painful symptoms, and can affect their ability to work and fully participate in life activitiesCitation2.
The burden of disease for IBD is high in the US, with roughly 1–1.3 million people suffering from IBDCitation3. The majority of the cost is attributable to medical care, with further increases in cost due to severe or poorly controlled disease leading to surgery or other expensive interventions. In fact, nearly two-thirds of patients with CD and one-third of UC patients will require surgical intervention for disease control in their lifetimeCitation4–6. Drug therapy to manage IBD is associated with substantial costs, particularly since the introduction of innovative biologic treatmentsCitation7. The annual cost of medical and surgical treatments for CD are estimated at nearly $2 billion USD (2008 USD), and the direct medical costs of UC are estimated at over $4 billion USD (2009 USD)Citation8.
In the US, initial disease management for UC and CD patients typically consists of drug therapy. Agents, such as aminosalicylates, may be prescribed to control disease course and manage symptoms, with corticosteroids added during periods of exacerbated symptoms and/or non-responsive disease. Patients who progress or experience consistent moderate-to-severe disease activity are typically transitioned to treatment with biologic therapy. Once a patient is considered eligible to receive biologic therapy, clinicians must determine whether a self-injected or infused therapy would be the best treatment choice. If prescribing infusion therapy, clinicians may select one of two currently approved therapies: infliximab (Remicade) or vedolizumab (Entyvio). At present, the published American College of Gastroenterology (ACG) guidelines are limited to guidance about the use of infliximab for patients with moderate-to-severe UC and CDCitation7,Citation8.
Institutions that administer monitored infusions for IBD incur costs beyond drug acquisition. The aim of this study was to develop a model framework to undertake a micro-costing analysis to evaluate the majority of identifiable costs associated with the delivery of hospital-based infusion services (preparation, administration, and follow-up) in the US for treatment of patients with UC or CD receiving treatment with either infliximab or vedolizumab. As such, the model provides infusion center administrators and clinicians treating IBD with an adaptable tool to identify and assess the myriad of costs related to the provision of infusion therapy.
Methods
A model was developed in Microsoft Excel to estimate the annual costs associated with providing monitored infusions of either infliximab or vedolizumab to patients for treatment of moderate-to-severe IBD (UC and CD) in a US hospital setting. For this analysis, an activity-based costing (ABC) framework approach was used. This method allows for the estimation of direct costs for a specific activity by comprehensively identifying the set of resources necessary to complete that activity, in order to calculate total cost of careCitation9,Citation10. The model analyses were conducted from the perspective of a US hospital.
Base-case model input estimates were obtained from multiple sources. First, administrators at five community hospital-based infusion centers were surveyed about their patient volume, patient mix, and overheadsCitation11. Second, staff time requirements for reconstitution and administration of infusion drugsCitation12,Citation13 and treatment for infusion reactionsCitation14 were obtained from published literature. Third, product package inserts informed the majority of the assumptions around the administration, dosing, schedule of monitored infusions, and rates of infusion reactionsCitation15,Citation16. Fourth, standard costing sources were used for medical staff wagesCitation17 and medicationsCitation18, while costs for supplies were determined based on internet searches of medical suppliers.
Activities relevant to providing infusion services were identified and limited to the hospital pharmacy or related infusion center pharmacy (for preparation of infusion), and the infusion center itself (for administration of infusion and management of patient). Costs obtained from the published literature were adjusted to 2015 US dollars using the mid-year medical care component of the Consumer Price IndexCitation19.
A complete listing of all base-case model estimates (time, costs, facility characteristics, and practice patterns) is displayed in ; provided below is an overview of data sources chosen to inform the base-case estimate.
Time estimates
An observational study by Pierce and BakerCitation13 detailed the process model that was used to estimate time spent by nursing staff to administer an infusion. Time spent for administration of infusion therapy varied by product, and matched the product package inserts’ specifications for total infusion timeCitation15,Citation16. The model assumed infusion services were predominantly delivered by nursesCitation13. An observational study by Brixner et al.Citation12, that quantified chemotherapy preparation time, informed estimates of pharmacist and technician time per infusion, in addition to overhead costs related to infusion preparation.
Pre-medication as prophylaxis for acute hypersensitivity reactions was assumed for treated patients, as outlined in the product package inserts (e.g. use of diphenhydramine prior to administration of therapy) and confirmed with a clinical expertCitation15,Citation16. Infusion reaction rates for infliximab and vedolizumab were obtained from the package insertCitation15,Citation16. A published review informed time estimates for medical staff managing hypersensitivity reactions during a patient’s infusionCitation14. Time estimates for nurse management of infusion reactions were weighted by frequency of events.
Cost estimates
Infusion drug
The model considered infusion therapy for UC and CD with the biologics approved for marketing by the US Food and Drug Administration (FDA) of January 1, 2015 (infliximab or vedolizumab); product package inserts informed the dosing and schedule of infusionsCitation15,Citation16. An average patient weight of 80 kg was assumed to calculate the total dose for infliximab infusions.
The infliximab package insert identifies a range of doses for the treatment of CD and indicates that patients’ dose is individualized based on their clinical response, noting that patients who initially respond to treatment but later lose their response may benefit from the increased dose of 10 mg/kg infliximabCitation16. Published literature on real-world treatment patterns with infliximab informed assumptions around dose escalation to 10 mg/kg for UC and CD patients receiving infliximab therapy in Year 1 or a stable maintenance dose (5 mg/kg or 10 mg/kg) in subsequent years (Year 2+) for patients who experienced an inadequate response to infliximab therapyCitation20–22.
The total annual cost of infusions was based on the number of infusions for each product in a given year, with users specifying the number of patients in their first year of therapy. In Year 1, patients receiving both vedolizumab and infliximab were assumed to receive eight infusions in total (i.e. three induction doses by Week 6, followed by an infusion every 8 weeks thereafter)Citation15,Citation16. In Year 2 or later, vedolizumab patients were assumed to receive seven infusions annually (i.e. infusions every 8 weeks). This assumption differed for infliximab, based on real world data that suggests a proportion of patients receive dose modifications to manage inadequate treatment response during maintenance therapy. The model considered two schedules of infusions for infliximab patients, every 8 weeks or every 6 weeks, based on published reportsCitation16,Citation22.
Staff compensation
Average hourly salary values (wages) and the proportion of total compensation for benefits were based on the most recent estimates published by the Bureau of Labor Statistics (BLS)Citation17 at the time of this study for hospital employees. Salaries (wages plus benefits) were calculated as suggested by BLS for healthcare providersCitation23.
Supplies
A comprehensive list of disposable supplies and the number of units required for reconstitution and administration of infusion therapy was developed utilizing prescribing information and expert opinion. Data on supply costs were derived from searches of medical supply websites or obtained from Wolters Kluwer Health’s Medi-Span Price Rx online (member access only)Citation18. To calculate overall supply costs, the number of each type of supply used was multiplied by the unit cost.
Pharmacy non-labor facility costs
These costs were not specifically related to preparation and administration of infusions, but are required for the general performance and operation of the pharmacy, and included facility, utility, and equipment costs. Estimated non-labor facility costs included in the model were storage, space rental, equipment, and other drug information resources. In the pharmacy, these costs were estimated per dose of infusion therapy grounded in findings from a published studyCitation12.
Pharmacy labor facility costs
A published estimate of labor overhead in the pharmacy measured personnel time required to maintain the pharmacy, but not related to direct patient care (e.g. managing annual physical inventory and current inventory levels, insurance management, coding, reimbursement tasks, and disposal of waste materials)Citation12.
Infusion center (facility) non-labor costs
In the infusion center, non-labor overhead incorporated costs were related to rent, utilities, facilities (per square foot), and capital equipment. The base-case value for Class A medical space (e.g., rent, utilities, and maintenance) was obtained from DesHarnais Castel et al.Citation24. For the base-case, a survey of community-based infusion center administrators informed the size of the infusion center (estimated at 2,500 square feet)Citation11.
Prices for infusion equipment such as infusion chairs, pumps, and electronic blood pressure monitors were estimated based on an internet search and multiplied by the proportion of patients seeking infusion therapy among all patients at the site expected to use each resource. Capital depreciation was taken over 5 years in accordance with IRS guidelinesCitation25. While other categories of non-labor overhead may exist, no published estimates were available and, as such, no other categories were included in the model.
Infusion center (facility) non-labor costs
Costs of the infusion center labor overheads were estimated at 2.33-times the non-labor overhead reported in Brixner et al.Citation12.
Laboratory
Although the cost calculation for hospital infusion administration does not include estimates of the annual cost of diagnostic tests performed by the laboratory, these costs were included in this analysis. The choice and frequency of laboratory testing was drawn from the product package insertsCitation15,Citation16, and supplemented with clinical expert opinion. Fee schedules published by the Centers for Medicare and Medicaid ServicesCitation26,Citation27 informed the costs for routine laboratory testing.
Allocated overhead
Apart from direct overhead costs associated with the two relevant facilities (pharmacy and infusion center), hospitals incur added overhead costs that are spread across each business unit. These allocated overheads are costs administrators must consider and account for services unrelated to providing infusion services (e.g. maintenance and repairs, medical records, laundry). Previously published studies report overhead costs for US hospitals in the in the range of 22.8–46.1%Citation28,Citation29. The allocated overhead for the base-case analysis in this model was assumed to be 30% and was applied to all cost categories with the exception of infusion drug. Costs modeled are presented with and without the allocated overheads ().
Exploratory analysis of costs to the patient
Patients with IBD (UC and CD) may incur substantial individual and societal costs (in addition to high medical costs) that should be considered by the treating clinician in management of the diseasesCitation2,Citation8,Citation30. To examine the impact of infusion therapy on these individual and societal costs not borne directly by hospitals, the value of annual out-of-pocket costs for transportation and indirect costs of lost time from work (assumed to be up to half a day of missed work) were estimated by performing an exploratory analysis. Estimates of the proportion of employed CD and UC patients were obtained from clinical trialsCitation31,Citation32. The indirect costs of infusion therapy incurred by patients were calculated using the national average wage and benefits estimate for all civilian workers from BLSCitation23 to estimate the value of lost compensation due to time spent receiving infusion therapy. Finally, literature-based estimates informed the costs and average travel time of patients’ transportation to/from the infusion centerCitation33. These input assumptions are described in .
Results
Infliximab
The model calculated costs for patients initiating therapy (Year 1) or on a stable maintenance dose of infliximab (Year 2+). In Year 1, all UC and CD patients were assumed to receive a dose of 5 mg/kgCitation16. In the first year of therapy, it was assumed a portion of treated UC and CD patients may lose response to infliximab ∼38 weeks, as observed in the ACCENT trial, resulting in increasing their infliximab dose to 10 mg/kg, or undergoing more frequent infusions (changing their infusion schedule from every 8 weeks to every 6 weeks), or both escalating dose and having a more frequent schedule of infusionsCitation34. For patients on maintenance therapy with infliximab (Year 2+), the proportions of patients receiving a stable regimen of 5 mg or 10 mg/kg and proportions of patients receiving infusions on a 6- or 8-week schedule were informed by publications reporting on real-world treatment patterns with infliximab therapy for IBD. The base-case input assumptions for Year 1 and 2+ infliximab dose and schedule are listed in . The following section summarizes the annual costs for infliximab-treated patients in Year 1 and Year 2+.
Total costs
The total annual modeled per patient costs of the first year of infusion therapy with infliximab was $38,782, and rose to $49,897 in Year 2+. These costs were categorized to infusion drug, labor, non-labor, laboratory, and allocated overhead. Infusion drug costs represented the greatest share of total costs, followed by labor costs. Results of the base-case analysis by each cost category for infliximab are presented in .
Infusion drug costs
Infusion drug cost accounted for the greatest percentage of overall infusion therapy costs, $34,994 (90.2%) for infliximab-treated patients in year 1, and $46,290 (92.8%) in Year 2+.
Labor costs
The annual cost of nursing and pharmacy labor to administer infusion therapy before application of the 30% allocated overhead was $2,177 for infliximab in Year 1, and $2,045 for maintenance therapy in subsequent years. With the inclusion of allocated overhead, the costs increased to $2,830 in Year 1, and $2,659 in Year 2+. Labor comprised the greatest proportion of non-drug costs (56% of total), followed by allocated overhead (23% of total), non-labor costs (14% of total), and laboratory costs (7% of total). presents the breakdown of individual cost components of this category.
Non-labor and overhead costs
On a per dose basis, non-labor facility and overhead costs were assumed to be the same for all products modeled, and varied based on the number of annual infusions. For infliximab-treated patients, the cost of infusion supplies was $259 and $265 in Year 1 and Year 2+, respectively (without allocated overhead). Pharmacy non-labor cost was $53 and $50, while the cost of infusion center facility non-labor was $175 and $164 in Year 1 and Year 2+, respectively, before application of allocated overhead. With application of 30% allocated overhead, total non-labor costs were ∼ $633 in Year 1 and $623 in Year 2+.
Vedolizumab
All assumptions for the dosing of vedolizumab as initial therapy (Year 1) or maintenance therapy (Year 2+) were drawn from the product package insertCitation15. Model results for vedolizumab are summarized below.
Total costs
The total annual modeled per patient costs of Year 1 of infusion therapy with vedolizumab were $41,320, and $36,197 in Year 2+. Results of the base-case analysis by each cost category for vedolizumab are presented in .
Infusion drug costs
For vedolizumab, cost of infusion drug accounted for the greatest percentage of total costs, $38,552 (93.3%) in Year 1, and $33,733 (93.2%) for maintenance therapy in subsequent years (Year 2+).
Labor costs
Labor costs prior to the application of the 30% allocated overhead were $1,495 for vedolizumab in Year 1, and $1,309 in Year 2+. Including allocated overhead, costs increased to $1,944 in Year 1 and $1,702 in Year 2+. As with infliximab infusions, labor made up the greatest proportion of non-drug costs (53% of total), followed by allocated overhead (23% of total), non-labor costs (14% of total), and laboratory (10% of total). presents the components of individual costs in this category.
Non-labor and overhead costs
For vedolizumab-treated patients, the cost of infusion supplies without allocated overhead ranged from $160 in Year 1 to $141 in Years 2+. Pharmacy non-labor was $52 in Year 1 and $45 in Year 2, and the cost of facility non-labor was $172 in Year 1 and $150 in Year 2+, prior to the application of allocated overhead. With application of the 30% allocated overhead, the total non-labor costs were ∼ $499 in Year 1 and $437 in Year 2+.
Laboratory costs
Patients prescribed infusion therapy with a biologic agent require periodic laboratory monitoring, included in preparation for both infliximab and vedolizumab therapy. Tests considered included a complete blood count (CBC), comprehensive metabolic panel (CMP), C-reactive protein (CRP), and erythrocyte sedimentation rate (ESR), as well as the tuberculin skin test or a TB quantiferon lab test every 1–2 years, and hepatitis A/B antibody serologies prior to the start of biologic treatment. The annual cost of laboratory testing was similar across both treatments, costing $250 in both years modeled ($325 with inclusion of allocated overhead).
Sensitivity analysis
One-way sensitivity analyses were conducted with allocated overhead costs (20–40%), wages (±20%), drug acquisition cost (±20%), and, for infliximab only, reduction in infusion time to 1 h. Overall, the model parameter most sensitive to change was drug acquisition price. The infliximab scenario was most sensitive to drug acquisition, modifying annual costs by −$7,000 to $9,256, followed by staff wages (−$425 to $423), and total infusion time (−$571 to −$535). The vedolizumab scenario was most sensitive to changes in drug acquisition costs (−$7,710 to $7,710), followed by staff wages (−$250 to $249) and allocated overhead (−$213 to $213). Results of sensitivity analyses are presented in .
Exploratory analysis of costs to the patient
The calculated cost of transportation to/from the infusion center varied based on the number of infusions over the year. The annual cost of transportation to and from infusion centers is estimated to cost each patient between $108–$125. For patients who were employed, the annual value of lost wages associated with time spent at the infusion center ranged from $842–$1,197 (not shown).
Discussion
Providing infusion services is associated with substantial costs that may impact the bottom financial line of hospitals, as demonstrated by this economic analysis. In this study, the cost of infusion drug was the primary driver of infusion therapy costs with the administration of both infliximab and vedolizumab for the management of moderate-to-severe IBD, representing 90–93% of total costs. However, personnel, supplies, pharmacy/facility non-labor, and allocated overhead costs were not inconsequential, and accounted for $2,400–$3,800 of care costs per patient annually.
While administration costs only make up a small proportion of the total cost to infuse biologic drugs, when presented with a large patient volume, these administrative costs can quickly accumulate into substantial sums. In totality, these costs can cause significant financial implications for the hospital, and may be further exacerbated if adequate reimbursements cannot be obtained from payers. In the last few years, some institutions have stopped providing infusion therapy or looked to find alternative means of delivering infusion care to patients at more cost-effective sites of care (e.g. office infusions, home infusion, etc.)Citation35. In addition, some institutions have begun operating their own specialty pharmacies and using the data they generate to assess which infused therapies are cost-effective and can be delivered efficiently to patientsCitation36.
There is currently a lack of published data that examines the costs of infusion care delivery to IBD patients. With the availability of both infused and self-administered biologic therapies to treat IBD patients, there is a need for hospital stakeholders to be able to assess the total costs and trade-offs associated with the alternative means of providing biologic therapy. This model is a first step in developing a general framework to analyze costs associated with infusion therapy for IBD. This analysis highlights the value to hospital administrators of assessing their infusion patient mix by disease or indication—based on whether other effective drugs are available in different dosage forms (subcutaneous) that can free up infusion center facilities and personnel to provide care to more patients in therapy areas for which there are not alternatives to infusions. While the use of estimates from national and public sources have helped create a generalizable model, the hospital infusion cost model presented here can easily be modified to calculate local infusion administration costs based on values provided by an individual hospital. Furthermore, once the model scenario is individualized, stakeholders evaluating the model results may be better able to perform meaningful hypothetical scenarios to evaluate the impact of adjusting services for administrative decision-making.
Despite the strengths of this model, it is also important to note that the decision to treat patients with a specific biologic agent should not be solely influenced by cost analyses of therapies.
Our model does not take into account various important factors that impact treatment decision-making, including disease characteristics/phenotype (e.g. presence of small bowel disease and perianal fistulas) and patient preference (e.g. severe needle-phobia and convenience of self-injectables). All factors influencing clinician decisions must be taken into account, including but not limited to cost, to provide the best possible clinical outcomes for patients.
The base-case analysis has several limitations. A major limitation is reliance on published estimates, many of which are dated, to inform the base-case. There were several sources that could be used to inform current treatment practice with infliximab, including rates of dose escalation with infliximabCitation20–22. Unfortunately, at the time of this study, no real world data was published for treatment with vedolizumab; thus, the product package insert had to inform all assumptions about treatment with vedolizumabCitation15. Another limitation is that the model obtained base-case estimates for infusion drug and infusion supplies from publicly available sources; many hospitals may obtain volume pricing and/or drug discounts that are not reflected in the base-case model scenario. Next, the base-case scenario assumes a small hospital infusion center, treating an average of 100 patients per week. A larger infusion center serving more patients weekly may experience some economies of scale associated with greater patient volume and more efficient use of capital equipment (e.g. infusion chairs, monitors), yielding lower costs per infusion, since associated overhead costs would be distributed among more individual patients. A further limitation is that costs to the patient (e.g. transportation costs and lost wages) were not included in the base-case estimate of infusion administration costs given the model adopts the hospital perspective. However, we briefly present these costs in an exploratory analysis to highlight their importance in contributing to the overall cost burden of infused products. Lastly, neither of the studies from which time estimates were derived included extensive documentation about the role of non-health personnel, suggesting that the model may under-estimate total hospital costs. Recognizing this limitation, the model developers plan to undertake a subsequent study to generate real world data that might be used to populate the model with estimates representative of current treatment practices and institutional costs.
Conclusions
Costs incurred by a hospital-based infusion center in administering any infusion drug may have a substantial financial impact to an institution. In this study, drug acquisition was the single greatest driver of costs associated with infusion based therapy for IBD patients; however, personnel, supplies, pharmacy/facility non-labor, and allocated overhead costs represent substantial costs for an institution. As the reimbursement landscape changes, tools for evaluating the costs for the provision of infusion therapy may help hospital administrators make informed choices and weigh the trade-offs associated with providing infusion services for IBD patients.
Transparency
Acknowledgment
No assistance in the preparation of this article is to be declared.
Declaration of funding
Full funding for this research was provided by AbbVie, Inc. AbbVie, Inc. was involved in all stages of the study research and manuscript preparation.
Declaration of financial/other interests
AA is an employee of the University of Washington, Harborview Medical Center, and has served as a consultant for AbbVie, Inc., but did not receive research funding or consulting fees for this project. KO was an employee of ICON plc, Health Economics. MF is an employee of ICON plc, Health Economics. JC was an employee of AbbVie, Inc., and owns stocks and shares in AbbVie, Inc. AW is an employee of AbbVie, Inc., and owns stocks and shares in AbbVie, Inc. JME peer reviewers on this manuscript have no relevant financial or other relationships to disclose.
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