Role of economic evidence in coverage decision-making in South Korea.

OBJECTIVES: The South Korean government required the submission of economic evidence when it implemented the Positive-List System in December 2006. This study investigates the key factors that influenced actual public insurance reimbursement decisions, including the role of economic evidence, after 10 years of decision practice under compulsory health technology assessment (HTA) for new drugs. METHOD: Logistic regression analysis was used to estimate the impact of the variables involved, including cost-effectiveness ratio as a key variable, on reimbursement decisions. The latter were defined as "yes" or "no" at a submitted price and indication. Only cases (n = 91) that present a cost-effectiveness ratio, and that have been reviewed based on this ratio from January 2007 to December 2016, were included in the analysis. RESULTS: Cases with higher cost-effectiveness ratios were less likely to be accepted. In addition, drugs that were used to treat severe diseases and drugs with no substitute were more likely to be recommended. The probability of acceptance declined along with the level of uncertainty in the submitted evidence. The acceptance rate for severe-disease drugs has increased since 2013, when the government introduced several policies that lowered the existing barriers to positive reimbursement. However, such an increase was not statistically significant. CONCLUSIONS: Cost-effectiveness is one of the most influential factors in drug-reimbursement decisions. However, inclusion of other explanatory variables, in addition to the cost-effectiveness ratio, predicted the results of decisions more accurately.

Health Expenditure Growth under Single-Payer Systems: Comparing South Korea and Taiwan.

OBJECTIVE: Achieving universal health coverage has been an important goal for many countries worldwide. However, the rapid growth of health expenditures has challenged all nations, both those with and without such universal coverage. Single-payer systems are considered more efficient for administrative affairs and may be more effective for containing costs than multipayer systems. However, South Korea, which has a typical single-payer scheme, has almost the highest growth rate in health expenditures among industrialized countries. The aim of the present study is to explicate this situation by comparing South Korea with Taiwan. METHODS: This study analyzed statistical reports published by government departments in South Korea and Taiwan from 2001 to 2015, including population and economic statistics, health statistics, health expenditures, and social health insurance reports. RESULTS: Between 2001 and 2015, the per capita national health expenditure (NHE) in South Korea grew 292%, whereas the corresponding growth of per capita NHE in Taiwan was only 83%. We find that the national health insurance (NHI) global budget cap in Taiwan may have restricted the growth of health expenditures. Less comprehensive benefit coverage for essential diagnosis/treatment services under the South Korean NHI program may have contributed to the growth of out-of-pocket payments. The expansion of insurance coverage for vulnerable individuals may also contribute to higher growth in NHE in South Korea. Explicit regulation of health care resource distribution may also lead to more limited provisioning and utilization of health services in Taiwan. CONCLUSION: Under analogous single-payer systems, South Korea had a much higher growth in health spending than Taiwan. The annual budget cap for total reimbursement, more comprehensive coverage for essential diagnosis and treatment services, and the regulation of health care resource distribution are important factors associated with the growth of health expenditures.

Medical costs in patients with heart failure after acute heart failure events: one-year follow-up study.

AIMS: This study investigated annual medical costs using real-world data focusing on acute heart failure. METHODS: The data were retrospectively collected from six tertiary hospitals in South Korea. Overall, 330 patients who were hospitalized for acute heart failure between January 2011 and July 2012 were selected. Data were collected on their follow-up medical visits for 1 year, including medical costs incurred toward treatment. Those who died within the observational period or who had no records of follow-up visits were excluded. Annual per patient medical costs were estimated according to the type of medical services, and factors contributing to the costs using Gamma Generalized Linear Models (GLM) with log link were analyzed. RESULTS: On average, total annual medical costs for each patient were USD 6,199 (±9,675), with hospitalization accounting for 95% of the total expenses. Hospitalization cost USD 5,904 (±9,666) per patient. Those who are re-admitted have 88.5% higher medical expenditure than those who have not been re-admitted in 1 year, and patients using intensive care units have 19.6% higher expenditure than those who do not. When the number of hospital days increased by 1 day, medical expenses increased by 6.7%. LIMITATIONS: Outpatient drug costs were not included. There is a possibility that medical expenses for AHF may have been under-estimated. CONCLUSION: It was found that hospitalization resulted in substantial costs for treatment of heart failure in South Korea, especially in patients with an acute heart failure event. Prevention strategies and appropriate management programs that would reduce both frequency of hospitalization and length of stay for patients with the underlying risk of heart failure are needed.

Eight-year experience of using HTA in drug reimbursement: South Korea.

This study describes the process and results of drug reimbursement decision-making in South Korea and evaluates its performance from the perspectives of the various stakeholders involved. Data were retrieved from the evaluation report posted on the Health Insurance Review and Assessment Service (HIRA) website. As of 2014, 253 new drugs had been submitted to the HIRA for appraisal. Of these, 175 (69.2%) were recommended in favor of listing and 78 (30.8%) were rejected. Furthermore, 68 of these drugs were deemed clinically improved relative to existing drugs. For those drugs that did not demonstrate clinical superiority (which was most of them), a simple price comparison to the existing drug was utilized as a gate toward listing. On top of the base-line analysis, 104 stakeholders from the industry, academia, public office, and civic society responded to a questionnaire designed to obtain their opinions on the South Korean positive list system (PLS). Stakeholders agreed that the consistency of reimbursement decision-making has improved since 2007, while accessibility to new drugs has apparently decreased. Respondents also indicated a preference toward improved public access to decision-making information. This examination of reimbursement decisions in South Korea will illuminate critical issues for countries that are considering the introduction of similar policies.

Factor Configurations with Governance as Conditions for Low HIV/AIDS Prevalence in HIV/AIDS Recipient Countries: Fuzzy-set Analysis.

This paper aims to investigate whether good governance of a recipient country is a necessary condition and what combinations of factors including governance factor are sufficient for low prevalence of HIV/AIDS in HIV/AIDS aid recipient countries during the period of 2002-2010. For this, Fuzzy-set Qualitative Comparative Analysis (QCA) was used. Nine potential attributes for a causal configuration for low HIV/AIDS prevalence were identified through a review of previous studies. For each factor, full membership, full non-membership, and crossover point were specified using both author's knowledge and statistical information of the variables. Calibration and conversion to a fuzzy-set score were conducted using Fs/QCA 2.0 and probabilistic tests for necessary and sufficiency were performed by STATA 11. The result suggested that governance is the necessary condition for low prevalence of HIV/AIDS in a recipient country. From sufficiency test, two pathways were resulted. The low level of governance can lead to low level of HIV/AIDS prevalence when it is combined with other favorable factors, especially, low economic inequality, high economic development and high health expenditure. However, strengthening governance is a more practical measure to keep low prevalence of HIV/AIDS because it is hard to achieve both economic development and economic quality. This study highlights that a comprehensive policy measure is the key for achieving low prevalence of HIV/AIDS in recipient country.

CHALLENGES FACED IN TRANSFERRING ECONOMIC EVALUATIONS TO MIDDLE INCOME COUNTRIES.

BACKGROUND: Decision makers in middle-income countries are using economic evaluations (EEs) in pricing and reimbursement decisions for pharmaceuticals. However, whilst many of these jurisdictions have local submission guidelines and local expertise, the studies themselves often use economic models developed elsewhere and elements of data from countries other than the jurisdiction concerned. The objectives of this study were to describe the current situation and to assess the challenges faced by decision makers in transferring data and analyses from other jurisdictions. METHODS: Experienced health service researchers in each region conducted an interview survey of representatives of decision making bodies from jurisdictions in Asia, Central and Eastern Europe, and Latin America that had at least 1 year's experience of using EEs. RESULTS: Representatives of the relevant organizations in twelve countries were interviewed. All twelve jurisdictions had developed official guidelines for the conduct of EEs. All but one of the organizations evaluated studies submitted to them, but 9 also conducted studies and 7 commissioned them. Nine of the organizations stated that, in evaluating EEs submitted to them, they had consulted a study performed in a different jurisdiction. Data on relevant treatment effect was generally considered more transferable than those on prices/unit costs. Views on the transferability of epidemiological data, data on resource use and health state preference values were more mixed. Eight of the respondents stated that analyses submitted to them had used models developed in other jurisdictions. Four of the organizations had a policy requiring models to be adapted to reflect local circumstances. The main obstacles to transferring EEs were the different patterns of care or wealth of the developed countries from which most economic evaluations originate. CONCLUSIONS: In middle-income countries it is commonplace to deal with the issue of transferring analyses or data from other jurisdictions. Decision makers in these countries face several challenges, mainly due to differences in current standard of care, practice patterns, or gross domestic product between the developed countries where the majority of the studies are conducted and their own jurisdiction.

The Health Technology Assessment Environment in Mainland China, Japan, South Korea, and Taiwan-Implications for the Evaluation of Diabetes Mellitus Therapies.

BACKGROUND: Diabetes mellitus (DM) is associated with a significant global economic and humanistic burden. The condition presents a real challenge in Asia, which accounts for more than 60% of individuals with DM globally. Health technology assessment (HTA) is a field of scientific research used to inform policy and clinical decision making relating to the introduction and diffusion of health technologies. OBJECTIVES: This article, examines the present use and predicted evolution of HTA with respect to pricing and reimbursement of drugs in mainland China, Japan, South Korea, and Taiwan. It makes specific reference to important assessment considerations for DM therapies, which should assist key stakeholders in choosing which data to capture, and what approaches to use, to help quantify the value of treatment. METHODS: The findings are informed by two Advisory Board discussions, a literature review, and the authors' personal experience. RESULTS: HTA already has a key role in South Korea and Taiwan, with current systems undergoing important changes. In contrast, in mainland China and Japan, HTA is not yet formally utilized, although this appears likely to change. Several elements are important for HTA to be meaningful and impactful for DM therapies, including a clear, transparent analytical framework for HTA that includes all relevant costs and outcomes; availability of local DM epidemiologic, economic, and quality-of-life data; acceptance of modeling as a core methodology; availability of real-life patient data; and recognition of specific evidence requirements associated with biosimilars. HTA has the potential to assist payors in making informed decisions about the coverage of DM medications.

Price cuts and drug spending in South Korea: the case of antihyperlipidemic agents.

OBJECTIVE: To identify the effect of price control policies on drug expenditure in South Korea. METHODS: We retrospectively examined the effects of price-reduction policies on drug expenditures, in particular regarding anti-hyperlipidemic drugs. The National Health Insurance claims data for a 60-month period between 2006 and 2010 were analysed. A segmented regression analysis was conducted with three intervention variables: July 2008, April 2009, and January 2010. RESULTS: Despite three rounds of price cuts, monthly drug expenditures increased by KRW 599.67 million (USD 523,726) after the third intervention (p=0.0781). The trend in volume increased consistently, but not significantly. The unit prices showed a steady downward trend over time, but rebounded after the third price cut. The number of patients with hyperlipidemia more than doubled to 3729 (p=0.0801) per month after the entry of generics for atorvastatin in July 2008. CONCLUSION: Extensive price controls did not effectively suppress the growth of pharmaceutical expenditures. The increased number of patients, attributable to the newly launched generic drug atorvastatin, and the increased use of expensive drugs were major factors affecting the increase in drug spending. Policies that regulate both drug prices and utilisation, and that reduce financial burdens via enhanced use of generics need to be introduced.

Cost-utility analysis for platinum-sensitive recurrent ovarian cancer therapy in South Korea: results of the polyethylene glycolated liposomal doxorubicin/carboplatin sequencing model.

OBJECTIVE: We performed a cost-utility analysis to assess the cost-effectiveness of a chemotherapy sequence including a combination of polyethylene glycolated liposomal doxorubicin (PLD)/carboplatin versus paclitaxel/carboplatin as a second-line treatment in women with platinum-sensitive ovarian cancer. METHODS: A Markov model was constructed with a 10-year time horizon. The treatment sequence consisted of first- to sixth-line chemotherapies and best supportive care (BSC) before death. Cycle length, a time interval for efficacy evaluation of chemotherapy, was 9 weeks. The model consisted of four health states: responsive, progressive, clinical remission, and death. At any given time, a patient may have remained on a current therapy or made a transition to the next therapy or death. Median time to progressions and overall survivals data were obtained through a systematic literature review and were pooled using a meta-analytical approach. If unavailable, this was elicited from an expert panel (eg, BSC). These outcomes were converted to transition probabilities using an appropriate formula. Direct costs included drug-acquisition costs for chemotherapies, premedication, adverse-event treatment and monitoring, efficacy evaluation, BSC, drug administration, and follow-up tests during remission. Indirect costs were transportation expenses. Utilities were also derived from the literature. Costs and utilities were discounted at an annual rate of 5% per cycle. RESULTS: PLD/carboplatin combination as the second line in the sequence is more effective and costly than paclitaxel/carboplatin combination, showing an additional US$21,658 per quality-adjusted life years. This result was robust in a deterministic sensitivity analysis except when median time to progression of second-line therapies and administration cost of PLD/carboplatin per administration cycle were varied. The probability of cost-effectiveness for PLD/carboplatin combination was 49.4% at a willingness to pay $20,000. CONCLUSION: A PLD/carboplatin combination is an economically valuable option as second-line chemotherapy for the treatment of platinum-sensitive ovarian cancer in South Korea.

New anti-rebate legislation in South Korea.

The South Korean Government recently announced a reform in the drug anti-rebate law, with the purpose of eradicating pervasive, unethical, and illegal rebate practices in pharmaceutical marketing. The main objective of this reform is to have the ability to bring criminal charges against doctors and pharmacists for receiving illegal kickbacks from drug companies. Previously, provision of illegal kickbacks by drug companies led to criminal punishment of the drug companies alone, leaving doctors and pharmacists unpunished as the recipients. With the introduction of the "Dual Punishment System (DPS)" reform, criminal punishment for illegal rebates is extended to those receiving illegal kickbacks. Although bitter controversy erupted among stakeholders when the reform was first drafted, a civic group participated in the reform process and effectively influenced the legislative process to a successful end. Some interim outcomes from the DPS in terms of bringing illegal practices to account have already been reported since the policy's implementation in November 2010. The reform background, goals, potential issues, and policy implications are explored in this study with the objective of providing further insight into drug policy for other countries that face similar challenges in the area of drug marketing.

Implication of high-body-fat percentage on cardiometabolic risk in middle-aged, healthy, normal-weight adults.

OBJECTIVE: This study investigated the number of Korean adults who had a normal body mass index (BMI) but high body-fat percentage (BF%) and determined their increased risk factors for cardiovascular diseases, including high blood pressure, hyperglycemia, and dyslipidemia. DESIGN AND METHODS: This cross-sectional study was based on 12,386 subjects (6,534 men and 5,852 women), with a normal BMI, between 30 and 49 years of age. Subjects were categorized into two groups by BF% (normal BF% group, BF% <25 for men, and BF% <30 for women; high BF(%) group, BF% ≥25 for men, and BF% ≥30 for women). RESULTS: The proportion of subjects with a normal BMI and high BF% was 12.7% (n = 1,572; 291 [4.5%] men and 1,281 [21.9%] women). Subjects with a high BF% had a significantly higher prevalence of high blood pressure (men only), hyperglycemia, and dyslipidemia. Multiple logistic regression analyses revealed that subjects with a normal BMI and high BF% had a 1.63 (adjusted odds ratio, 95% confidence interval: 1.21-2.19) in men and 1.56 (adjusted odds ratio, 95% confidence interval: 1.36-1.80) in women increased risk of one or more cardiovascular risk factors compared to subjects in the normal BMI and normal BF% group, even after adjusting for abdominal obesity. CONCLUSION: High BF% is associated with a high cardiometabolic risks, regardless of abdominal obesity, in normal-weight Korean adults. Thus, follow-up screening of those with a high BF% may be necessary to detect and prevent cardiometabolic diseases, particularly for women with a normal BMI.

Cost-Effectiveness of Sertindole among Atypical Antipsychotics in the Treatment of Schizophrenia in South Korea.

OBJECTIVES: This study assessed the cost-effectiveness of sertindole compared with existing atypical antipsychotics in the treatment of patients with schizophrenia in the South Korean setting. METHODS: A Markov model was developed to estimate the cost-effectiveness of sertindole compared with risperidone, olanzapine, and quetiapine with a cycle of 6 months on a 5-year time horizon. Effectiveness was defined as the length of time without relapse and quality-adjusted life-years. Parameter estimates including drug-induced adverse events, compliance rate, and relapse rate were based on published literature and clinical trial data. Resource utilization data were obtained from the 2010 National Health Insurance reimbursement data, and costs were estimated from the health care system's perspective. A discount rate of 5% was applied to both cost and effectiveness. One-way sensitivity analyses and probabilistic sensitivity analysis were carried out to check the robustness of the base-case analysis. RESULTS: The length of time without relapse was 1.90 years for all study drugs. The estimated quality-adjusted life-years were 1.27 for sertindole, followed by quetiapine, risperidone, and olanzapine. Total costs were 10.51 million Korean won (KRW) for sertindole, 12.86 million KRW for olanzapine, 8.38 million KRW for risperidone, and 8.91 million KRW for quetiapine. The incremental cost-effectiveness ratios showed that sertindole was dominant only over olanzapine and was not cost-effective compared with risperidone and quetiapine. Various sensitivity analyses confirmed the results from the base-case analysis. CONCLUSIONS: Sertindole may be considered a valuable treatment option for South Korean patients who have failed the therapy with other atypical antipsychotic agents.