Real Option Approach for Comparing Lifetime Costs of Alternative Diabetes Type I Treatment Methods

By Haahtela, Tero | Fuzzy Economic Review, November 2016 | Go to article overview

Real Option Approach for Comparing Lifetime Costs of Alternative Diabetes Type I Treatment Methods


Haahtela, Tero, Fuzzy Economic Review


1.INTRODUCTION

Diabetes costs represent a significant worry to both patients and the health care system. The estimated total economic cost of diagnosed diabetes in USA in 2012 was $245 billion, of which type 1 diabetes (T1D) costs are $15 billion (Yang et al., 2013). In Finland, the medical costs of treating diabetes together with the lost labor inputs of diabetic patients reduces long-run gross domestic product by over one percent (Reini, 2013). There are more than 50 000 T1D people in Finland and close to one million type one diabetic people in the USA (IDF, 2015).

Type 1 diabetes, also called juvenile diabetes, is an autoimmune disease in which a person's pancreas stops producing insulin, a hormone that enables people to get energy from food. It occurs when the body's own immune system attacks and destroys the insulin-producing cells in the pancreas, called beta cells. T1D people need to treat themselves constantly with insulin. This is typically taken with subcutaneous injections using either insulin pens or an insulin pump. Unlike with most cases of type 2 diabetes, the cause of the T1D disease is still unknown, and it is not either preventable. However, genetics and environmental triggers are expected to be involved in the development of the disease. Diabetes and AIDS/HIV are the only two diseases that UN has officially decided to fight against.

Treatment of diabetes has improved significantly over the years. The costs are still, however, very high per person. At the moment, treatment of a diabetes type 1 patient over his lifetime costs approximately 1 million euros, of which complication costs and work absence costs are even 80 - 90 % of the total costs, and the daily basic treatment costs are 10 - 20 % (Kangas, 2002). Interest towards the cost structure of T1D treatment in Finland can be explained by its highest occurrence per capita in the World. In Finland, T1D rate is 62 persons per 100 000, in Scandinavia 35 persons, in the USA 24, but only 1 - 2 per 100 000 in China and Japan (IDF, 2015).

Most typical way of treating type 1 diabetes is to use multiple daily injections (MDI) of insulin. The method is also called flexible insulin therapy, as it gives more flexibility in treatment and life style in comparison with the conventional approach used commonly until early 1990's. Another way to treat T1D is continuous subcutaneous insulin infusion (CSII) that means using an insulin pump. This CSII method can be also enhanced with continuous glucose monitoring (CGM) where blood glucose level is continuously monitored with a sensor. In Finland, Use of CSII and CSII + CGM are considered for adults, adolescents and children with high average blood glucose levels despite of intensive MDI treatment or with occasional dangerously low blood glucose level episodes difficult to manage (Lahtela et al., 2012). According to the THL research, daily basic treatment direct costs of multiple daily injection (MDI) method, excluding health care visits, are 1800 euros, with insulin pump (CSII) 3500 euros, and with insulin pump and continuous glucose monitoring (CSII + CGM), 6200 euros (ibid).

There are many diabetics who would like to treat themselves with the CSII or CSII+CGM. However, some physicians deny this treatment method as they consider it to be too expensive in comparison with the expected benefits in therapeutic control and quality of life. This is also dependent of the hospital district in Finland and their policies. On the other hand, there are many physicians who consider that the expected lifetime cost with CSII and CSII+CGM would actually reduce the T1D overall costs, especially the complication costs, because of the better therapeutic control.

The purpose of this study was to investigate this issue and to compare what are the expected overall lifetime costs for treating a T1D patient with MDI or CSII+CGM methods. The analysis considers both the daily treatment costs as well as long-term complication costs of these approaches. …

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Real Option Approach for Comparing Lifetime Costs of Alternative Diabetes Type I Treatment Methods
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