Cost of a smoking cessation program/intervention: Consider a hypothetical smoking cessation program implemented in a health clinic. The cessation program primarily uses counseling and nicotine replacement to aid patients who express a desire to quit smoking. A program director is the full-time administrator of the program and patient services are provided by two registered nurse patient navigators within the clinic, who serve all patients seen at the clinic. Each patient navigator is 1.0 FTE for the entire clinic. There are a total of 200 patients seen in the clinic per month and of those patients, 50 are enrolled in the smoking cessation program. The program director’s salary is $79,000 per year and each patient navigator’s salary is $55,000 per year. The services offered by the program are free to patients and the clinic is reimbursed for the services through the state Medicaid program. Nicotine replacement costs $152 per patient per month. The clinic is reimbursed at a monthly rate of $175 per patient enrolled in the cessation program. The patients are referred from primary health care providers within the health care system of which the clinic is a part, and are seen on a bi-weekly basis to receive medication and counseling. The program is implemented January 2015 – March 2015. Patients receive follow-up contact in the subsequent 3 and 6 months (June and September) after the end of implementation of the program. Follow-up is provided via phone contact only by the program director to assess continued progress of the patient and document any problems or concerns to report back to the health care system. Prior to program implementation, the program director developed the protocol for the program, trained patient navigators, and marketed the materials to primary health care providers within the health system. This was the program director’s full time responsibilities fromJanuary – December 2014. The costs for protocol development were $18,000, costs for training patient navigators were $48,750, and costs for marketing were $12,250 in addition to program director’s salary. You are interested in designing a study to estimate the cost of the smoking cessation program.

Questions:

(1) Determine the perspective for analysis. Table 1 shows an example of four perspectives that could be considered in this case study: patient’s perspective, the provider’s perspective, the health sector perspective, and the societal perspective.

(2) Determine the intervention timeframe & analytic horizon.

(3) Evaluate Program costs.
a. Determine the costs to be included, based on the perspective you’ve chosen?

b. Categorize each cost (i.e. Is it pre-implementation, implementation or post- implementation?)

c. Identify analytic horizon for each cost, the cost, % FTE by line item. 

d. Total costs by line item.
e. Calculate total intervention costs for program.
 

Table 1. Example of costs that need to be included or excluded as a function of the perspective chosen to conduct an economic analysis Example of cost Direct medical Physician time Other medical personnel time Medications Medical devices Laboratory tests Direct non-medical Administration Physical facility (e.g, clinic) Utilities Patient's travel costs Education Training Indirect costs Time off work for office visits Time off work from illness Patient Yes/ (if copay applies) No Yes (if copay applies) No No No No No Yes No Yes Yes Analysis perspective Provider Yes Yes No No No Yes/No No No No Yes/No No No Health Sector Society Yes Yes Yes Yes Yes Yes Yes Yes No Yes No No Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Notes: The table was adapted from Meltzer 2001. Yes means that the specific cost item should be included in the corresponding perspective, No means the cost should not be included. The perspectives were chosen for illustrative purposes, the do not cover all possible perspectives. The inclusion of the costs items listed depend upon the specific perspective chosen Assumes that patient has some type of health-insurance. The specific inclusion exclusion of cost items depends upon the characteristics of the insurance. Physician time and medication costs in this example include co-payments. The provider perspective in this example is the health clinic staff providing services. *Health sector perspective includes all providers and payers and assumes that all medical costs are paid by the health sector. *The societal perspective includes all costs and benefits irrespective of who pays, it is the most comprehensive perspective and can be thought of as the sum of all perspectives minus transfers. Transfers are not included because they are only a way of distributing resources within a society, they do not increase or decrease the overall costs or benefits that a society perceives. Physician practice and health insurer may have separate administration costs.