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Budget Impact Analysis of Peritoneal Dialysis versus Conventional In-Center Hemodialysis in Malaysia
VALUE IN HEALTH REGIONAL ISSUES 9C (2016) 8–14
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Budget Impact Analysis of Peritoneal Dialysis versus Conventional In-Center Hemodialysis in Malaysia Sunita Bavanandan, MD1,*, Ghazali Ahmad, MD1, Ai-Hong Teo, BSc2, Lilian Chen, MD3, Frank Xiaoqing Liu, Ph.D.4 1 Department of Nephrology, Kuala Lumpur Hospital, Kuala Lumpur, Malaysia; 2Baxter Healthcare (M) Sdn Bhd, Kuala Lumpur, Malaysia; 3Baxter Healthcare Ltd., Shanghai, China; 4Baxter Healthcare Corporation, Deerfield, IL, USA
AB STR A CT
Objectives: To investigate the 5-year health care budget impact of variable distribution of adult patients treated with peritoneal dialysis (PD) and in-center hemodialysis (ICHD) on government funding in Malaysia. Methods: An Excel-based budget impact model was constructed to assess dialysis-associated costs when changing dialysis modalities between PD and ICHD. The model incorporates the current modality distribution and accounts for Malaysian government dialysis payments and erythropoiesis-stimulating agent costs. Epidemiological data including dialysis prevalence, incidence, mortality, and transplant rates from the Malaysian renal registry reports were used to estimate the dialysis patient population for the next 5 years. The baseline scenario assumed a stable distribution of PD (8%) and ICHD (92%) over 5 years. Alternative scenarios included the prevalence of PD increasing by 2.5%, 5.0%, and 7.5% or decreasing 1% yearly over 5 years. All four scenarios were accompanied with commensurate
changes in ICHD. Results: Under the current best available cost information, an increase in the prevalent PD population from 8% in 2014 to 18%, 28%, or 38% in 2018 is predicted to result in 5-year cumulative savings of Ringgit Malaysia (RM) 7.98 million, RM15.96 million, and RM23.93 million, respectively, for the Malaysian government. If the prevalent PD population were to decrease from 8% in 2014 to 4.0% by 2018, the total expenditure for dialysis treatments would increase by RM3.19 million over the next 5 years. Conclusions: Under the current cost information associated with PD and HD paid by the Malaysian government, increasing the proportion of patients on PD could potentially reduce dialysis-associated costs in Malaysia. Keywords: budget impact, in-center hemodialysis, peritoneal dialysis.
Introduction
gross domestic product of US $9983 per capita in 2012 [4]. Provision of RRT consumes a disproportionate amount of the health care budget—for example, in 2005, 0.06% of the Malaysian population with ESRD accounted for 1.72% of its total health care spending [5]. In 2013, a total of 33,519 prevalent patients with ESRD received RRT [6], but this figure is projected to double to 50,000 by 2020. Renal transplantation, that is, the surgical procedure to place a healthy donated kidney in the patient with ESRD, is the best RRT option. However, the new transplant rate in Malaysia is very low at 3 per million population (pmp) in 2013. Hence, most of the patients require dialysis therapy. In 2012, 94% of the patients on RRT were on dialysis therapy, with 92% on HD and 8% on PD [6]. In HD, blood obtained from the patient via a surgically created connection, for example, an arteriovenous fistula, is dialyzed across an artificial membrane in a dialyzer that is connected to a circuit outside the patient’s body. In PD, the peritoneal membrane lining the patient’s peritoneal cavity acts as a natural filter for wastes and excess fluids. PD dialysis solutions are instilled and removed via a permanent catheter placed through the abdominal wall into the peritoneal cavity. The PD solution
The global epidemic of chronic kidney disease poses a major public health problem not only in high-income countries but also in Asia. This problem is driven by the aging population, the global diabetes epidemic in which Asia has emerged as an epicenter [1], as well as the high prevalence of hypertension among Asians [2]. Similar trends are seen in Malaysia where National Health and Morbidity surveys have shown that the prevalence of diabetes among adults 18 years and older increased from 11.6% in 2006 to 14.2% in 2011 and the prevalence of hypertension rose from 32.2% to 32.7% [3]. Patients with chronic kidney disease who reach the final stage of kidney failure known as end-stage renal disease (ESRD) will require renal replacement therapy (RRT) by either hemodialysis (HD) or peritoneal dialysis (PD) or renal transplantation to sustain life. However, the provision of RRT is costly and has become a serious, escalating burden on the finances and human resources of health care systems worldwide. Malaysia is an upper-middle income developing country in Southeast Asia with a population of 29.3 million and an annual
Copyright & 2015, International Society for Pharmacoeconomics and Outcomes Research (ISPOR). Published by Elsevier Inc.
Conflict of interest: The authors have indicated that they have no conflicts of interest with regard to the content of this article. * Address correspondence to: Sunita Bavanandan, Hospital Kuala Lumpur, Jalan Pahang, Kuala Lumpur 50586, Malaysia. E-mail: [email protected]. 2212-1099$36.00 – see front matter Copyright & 2015, International Society for Pharmacoeconomics and Outcomes Research (ISPOR). Published by Elsevier Inc. http://dx.doi.org/10.1016/j.vhri.2015.06.003
VALUE IN HEALTH REGIONAL ISSUES 9C (2016) 8–14
exchanges are done manually with minimal equipment three to five times daily in continuous ambulatory PD (CAPD) or overnight with the assistance of an automated cycler (automated PD [APD]). In Malaysia, the provision of dialysis is via a public-private mix in health care. Although the Ministry of Health (MOH) remains to date as the largest single institutional provider for dialysis, the ministries of defense and higher education also provide dialysis to their employees and associated dependents. Historically, long-term HD in the MOH began in 1969 with very limited facilities at the main tertiary referral hospital in the country. Out of necessity, home HD was introduced in which patients bought their own machines but the government provided disposables, saline, and heparin. Office HD programs were also initiated in government departments such as the Ministry of Education and Treasury to enable department employees or their family members to obtain dialysis services, as well as minimize the risk of employees losing their jobs because of frequent leave for dialysis elsewhere. This also occurred in the armed forces and police where dialysis units were opened to cater to the needs of their personnel and dependents. This is how the provision of HD services by various government agencies such as the MOH, the Ministry of Education, and the armed forces evolved. In addition, several large corporations such as Malaysian Banking, Bank Bumiputera now Commerce International Merchant Bankers (CIMB), and Malaysian Airlines also provided office HD. However, as access to in-center HD services expanded, home HD and office HD have largely been replaced by HD performed in hospitals or freestanding hemodialysis centers. Although public, private, and nongovernmental organizations provided 30%, 45%, and 25% of overall dialysis treatment in 2012, respectively, the overall government funding constituted at least 58% of the total expenditure for dialysis in the country [6]. Growth of dialysis provision by the private sector has been the most rapid, and this has been mainly sustained by government funding through various agencies, predominantly the Public Service Department and the Social Security Organization, the latter being a government-run social insurance organization that receives mandatory contributions for employees in the private sector. Despite a remarkable growth in dialysis provision rates by more than 10-fold between 1993 and 2012, Malaysia is still unable to provide universal access to RRT [6]. With the expected rise in the prevalence of ESRD, the sustainability of dialysis therapy in the future is uncertain. In addition, there is an imbalance in dialysis treatment rates between geographical regions. Although the overall prevalence rate of patients on dialysis was 1019 pmp in 2013, states on the economically developed west coast of Peninsular Malaysia have a very high treatment rate ranging from 962 to 1585 ppm, whereas Sabah, Sarawak, and the east coast states of Peninsular Malaysia have far lower treatment rates ranging from 438 to 907 pmp [6]. PD is as effective as HD in the treatment of patients [7,8], and an economic evaluation conducted in government hospitals in Malaysia in 2003 has shown that the cost per life-year saved is slightly less for PD than for in-center HD (ICHD) (Ringgit Malaysia [RM] 31,635 vs. RM33,642) [9]. Studies using modeling methods for other countries have shown that where PD costs are less than HD costs, increased PD utilization would result in substantial health care savings [10,11]. In Malaysia, increasing PD utilization would also address inequality in dialysis access by allowing patients in rural areas and small towns, where HD is scarce or nonexistent, to obtain dialysis treatment. In addition, PD offers a number of medical advantages over HD. These include better preservation of residual renal function, less risk of bacteremia and sepsis, better quality of life, better hemodynamic stability, less requirements for erythropoetin-stimulating agents (ESAs), improved survival advantage in the first 2 years of RRT, and improved transplant outcomes [12–14].
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In 2012, a small working group of nephrologists was formed in the MOH to prepare a proposal for the Malaysian government to encourage increased use of PD. As a part of this initiative, this study was conducted to explore the 5-year health care budget impact of a variable mix of dialysis modalities of PD and HD to treat adult patients with ESRD in Malaysia. The information obtained may facilitate financial planning and health policy decisions regarding health care allocations for a more sustainable dialysis treatment program in the future.
Methods An Excel-based budget impact model was developed to estimate the dialysis-associated costs from the perspective of the Malaysian federal government, assuming various dialysis modality mixes between PD and ICHD over 5 years. The period of 5 years was chosen because this is the same duration as the Malaysian government’s economic development plans—the nation is presently in the Tenth Malaysian Plan, which spans from 2011 to 2015. The dialysis population that is covered by the Malaysian government changes year by year. Taking account of patients with ESRD both entering and leaving dialysis, the baseline dialysis population in each year was estimated using linear regression on the prevalence (pmp) of dialysis patients obtained from the Malaysian Dialysis and Transplant Registry for the past 10 years from 2003 to 2012 [6]. The entry rate in each year was estimated by projecting the incidence (pmp) of dialysis patients from 2003 to 2012, whereas the leaving rates accounted for both mortality (per 1000 patient-years) and kidney transplantation for the same period [6]. Over the last decade, the number of new transplant patients has been decreasing consistently. Using the past 10-year trend generates negative transplants in the near future, which is not logical. As a result, we assumed that the transplant number will remain constant between 2014 and 2018 by using the 2012 number. In addition, we assumed that all transplants are performed in government centers because over the last 20 years, 94% of local transplants have been performed in government hospitals [6]. Partial-year patients, including both the entering and leaving patients with ESRD, were assumed to be distributed uniformly throughout the year. Therefore, the costs and resource use of these patients were counted as half of those of full-year patients. In the baseline model, among the 58% of the total dialysis patients funded by the government agencies, 8% of them were assumed to receive PD and 92% ICHD over 5 years in alignment with 2013 Malaysian Dialysis and Transplant Registry data [6]. Three hypothetical scenarios were compared with this reference scenario. The first scenario was an increase in the use of PD by 2.5% per year over 5 years. The second was an increase in the use of PD by 5.0% per year, and the third was an increase in the use of PD by 7.5% per year over 5 years. For comparison, a scenario of decreasing the use of PD by 1.0% each year for 5 years was also analyzed. In each of the four hypothetical scenarios, ICHD percentages were adjusted so that the total percentage of PD and ICHD remained constant at 100% (Table 1). The dialysis-associated costs accounted in the model included dialysis access, dialysis services, and ESA use. Four types of HD vascular access exist in Malaysia: noncuffed catheter, cuffed catheter, arteriovenous fistula, and arteriovenous graft. Therefore, different access costs were weighted to impute one HD access cost as the final model input. In addition, there are several government agencies paying for dialysis in Malaysia, including the MOH, the Public Service Department, the Social Security Organization, and other government agencies (e.g., the Department of Defense). Each agency pays for the same service, for example, supply of ESA, with a different price. Therefore, our
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VALUE IN HEALTH REGIONAL ISSUES 9C (2016) 8–14
Table 1 – Current Malaysia dialysis modality distribution and patient distribution scenarios considered in the budget impact analysis. Scenario
Yearly PD/HD ratio (%)
Reference scenario Scenario 1 (2.5% annual PD use increase) Scenario 2 (5% annual PD use increase) Scenario 3 (7.5% annual PD use increase) Scenario 4 (1% annual PD use decrease)
2014
2015
2016
2017
2018
8/92 8/92 8/92 8/92 8/92
8/92 10.5/89.5 13/87 15.5/84.5 7/93
8/92 13/87 18/82 23/77 6/94
8/92 15.5/84.5 23/77 30.5/69.5 5/95
8/92 18/82 28/72 38/62 4/96
HD, hemodialysis; PD, peritoneal dialysis.
model weighted the different payments of each service from all the government agencies mentioned above on the basis of the number of dialysis patients covered by each agency. Furthermore, the MOH pays for the treatment of PD and HD in different ways. For PD, the MOH pays one price that covers PD solutions, disposables, home delivery, and home care. For HD, the national tendering determines the price for the different HD elements, such as dialysis machines, dialyzers, tubing sets, and arteriovenous needles. We did not have detailed data to weight all the different prices with the dialysis population funded by other government agencies. We instead used the HD costs from a published article [9] by excluding the ESA costs and hospitalization to match the MOH PD national price, which does not include the ESA cost and hospitalization. All the costs, if not presented in 2014 prices, were inflated to 2014 on the basis of the consumer price index published for Malaysia [15].
Results Table 2 presents the sizes of the dialysis populations that are covered by the Malaysian federal government based on a projection using the epidemiological parameters reported in Malaysian Dialysis and Transplant Registry annual reports and methods previously discussed. The projected dialysis population was around 18,000 dialysis patients covered by the Malaysian federal government at the start of 2014. The number is projected to increase to about 24,000 by the end of 2018. Table 3 presents the model inputs. As previously discussed in the Methods section, all input costs were weighted by the percentage of patient population covered by different government agencies and adjusted, where necessary, to costs in 2014 on the basis of the Malaysian consumer price index. For example, after weighting the monthly payment by different government agencies, PD costs about RM2508/month taking into account the
situation in Malaysia that the Public Service Department and the Social Security Organization cover both APD and CAPD, which have different costs, but the MOH and other government agencies cover CAPD only. Overall, CAPD accounts for 85% of the patients treated with PD and APD accounts for the remaining 15%. The final model input for PD is RM82.46 per day. Table 4 presents the cost results by category for the four hypothetical scenarios and the reference scenario, including dialysis-associated costs, 5-year cumulative cost differences, and annual cost differences. For the reference scenario, the estimated 5-year payment from the Malaysian federal government was about RM3.85 billion, including dialysis access, treatments, and ESA use. With the different scenarios of low, medium, and high increases in the use of PD, the cumulative savings to the Malaysian federal government varied from RM7.98 million to RM23.93 million over 5 years (2014–2018). In the scenario of lower PD use, costs were projected to increase by RM3.19 million. The 5year cumulative cost differences of the four hypothetical scenarios versus the reference scenario are also displayed in Figure 1.
Discussion Between 1994 and 2013, Malaysia succeeded in increasing the dialysis treatment provision rate by more than 10-fold from 440 to 1019 pmp, a level comparable with that in many high-income countries. However, HD is a more costly treatment compared with PD because it has high fixed costs (structure and human resources), whereas PD, in particular CAPD, has low fixed costs, but high variable costs (supplies) and a low need for investments [18]. Although the average ESA dose for patients treated with PD is lower than that for patients treated with HD [6], the administration of ESAs to patients treated with PD is limited to the subcutaneous route. Hence, all patients treated with PD are on
Table 2 – Projected dialysis population covered by the Malaysian government. Stock and flow of renal replacement therapy
Dialysis patients at start of year Incident dialysis patients Dialysis deaths Transplants Dialysis patients at end of year
Year 2014
2015
2016
2017
2018
17,992 4,104 2,159 94 19,112
19,112 4,316 2,301 94 20,232
20,232 4,528 2,444 94 21,352
21,352 4,739 2,588 94 22,472
22,472 4,951 2,733 94 23,592
Note. These counts are based on a total estimated Malaysian population size of 30,175,100 from the Malaysia Department of Statistics [16]. Among all the dialysis patients in Malaysia, funding from the federal government accounts for 58% of the patients with ESRD [6]. The incident dialysis patients, dialysis deaths, and transplants represent flows in and out of the dialysis population in Malaysia. ESRD, end-stage renal disease.
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VALUE IN HEALTH REGIONAL ISSUES 9C (2016) 8–14
Table 3 – Model inputs and associated sources. Dialysis-associated costs
PD cost/d
HD costs/session
ESA costs/1000 units
HD access costs
Final model input (RM)
Model input sources Government agency
Cost (RM)
Sample size weight*
MOH PSD SOCSO Other government agency
2097.2/mo‡ 3567.6/mo§ 2687.2/mo§ 2600.0/mo||
0.58 0.19 0.16 0.08
MOH PSD SOCSO
195/session¶ 200/session# 149/session#
0.41 0.35 0.24
MOH PSD SOCSO Other government agency
11.06/session** 40/session# 15/session# 40/session#
0.43 0.16 0.23 0.18
MOH
1882.2/ procedure†† 3237/procedure‡‡ 1882.2/ procedure†† 3237/procedure‡‡
0.26
82.46†
185.47
21.68
2471.13
PSD SOCSO Other government agency PD access costs ESA dose for a patient with PD per week ESA dose for a patient with HD per week
0.26 0.31 0.17
1445.47§§ 4000* 6000*
APD, automatic peritoneal dialysis; CAPD, continuous ambulatory peritoneal dialysis; ESA, erythropoiesis-stimulating agent; FMC, Fresenius Medical Care; HD, hemodialysis; MOH, Ministry of Health; PD, peritoneal dialysis; PSD, Public Service Department; RM, Ringgit Malaysia; SOCSO, Social Security Organization. * Sample size weight from Malaysian Dialysis and Transplant Registry (MDTR) Annual Data report [6]. † Calculated by multiplying the weighted monthly costs of RM2508 by 12 and then dividing by 365. ‡ Weighted by 70% Baxter CAPD (RM25,001.4/y) and 30% FMC CAPD (RM25,551.96/y) based on government national CAPD tender award 20132015 in the ratio Baxter:FMC of 70%:30% and the tender prices quoted by the respective firms. § Weighted costs for APD and CAPD by the patient number reported in the MDTR [6]. || Market price quoted to other government agencies by Baxter and FMC. ¶ Data from previous publication by Hooi et al. [9] and inflated to 2014 costs on the basis of the consumer price index after excluding ESA and hospitalization costs [15]. # Based on reimbursements to private dialysis facilities. ** Estimated on the basis of the national tendering price of RM15.83/2000 units for patients treated with HD (81%) and RM26.80/2000 units for patients treated with PD (19%). †† Estimated on the basis of 5.1% of HD noncuffed catheter (RM790), 3% HD cuffed catheter (RM1265), 90% arteriovenous fistulas [AVFs] (RM1950), and 1.9% arteriovenous grafts [AVGs] (RM2575), adjusted for annual inflation of 2.25% [6,15,17]. An assumption was made that all SOCSO patients obtain vascular access surgery at MOH hospitals. ‡‡ Estimated on the basis of 5.1% of HD noncuffed catheter (RM1000), 3% HD cuffed catheter (RM 3000), 90% AVF (RM3250), and 1.9% AVG (RM 9000) [6]. Costs were based on a sampling of claims forwarded from the PSD to the National Head of Nephrology Services for verification and endorsement. §§ Inflated from 2008 costs of RM1265 [15,17].
beta erythropoietin, which is more expensive than alpha erythropoietin, and this reduces overall cost savings. Our study has shown that increasing the proportion of patients on PD can potentially reduce future dialysis-associated costs. The cumulative cost savings for the Malaysian government generated by increasing PD utilization from the current 8% in 2012 to 18%, 28%, and 38% over 5 years are projected to be RM7.98 million, RM15.96 million, and RM23.93 million, respectively. The cost savings were driven by lower ESA costs and access costs associated with PD versus ICHD. Our findings are similar to those of other studies, which have also demonstrated significant cost savings [10,11,19]. In our local setting, the costs savings achieved can be used to treat 50 to 150 more patients with ESRD annually.
Alternatively, cost savings may be channeled into other competing therapies for chronic illnesses. The model was constructed with a simple concept of estimating the financial impact on the payer by varying the modality distribution between PD and HD. We included publicly available cost information in Malaysia, including dialysis access, dialysis service, and ESA, and did not include some other cost elements, such as in-patient and oral drugs, because of lack of data. With our target of increasing PD utilization up to a maximum of 28% and 38%, substantial savings have been found. This PD versus HD distribution was in line with published literature regarding nephrologists’ opinions on the optimal PD:HD utilization ratio. In Canada and North America [20,21], the opinion on the
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Table 4 – Cumulative costs for years 2014–2018 and change in costs by scenarios (RM1,000,000). Cumulative costs and cost differences
Dialysis Drugs* Total Cost difference vs. reference scenario Annual cost difference
Scenario Reference
Scenario 1
Scenario 2
Scenario 3
Scenario 4
3147.40 701.07 3848.46
3152.08 688.41 3840.48 7.98 1.60
3156.75 675.75 3832.51 15.96 3.19
3161.43 663.09 3824.53 23.93 4.79
3145.52 706.13 3851.65 3.19 0.64
RM, Ringgit Malaysia. * Drug costs reflect the use of erythropoiesis-stimulating agent.
optimum PD:HD ratio is 35:65, whereas in the United Kingdom [22] it is 40:60. Our study has a number of limitations. First, a major limitation is the reliance on a local economic evaluation conducted 10 years ago for HD costs [9], albeit with adjustment for inflation rates and for the current costs of ESA therapy. Since 2003, many costs, including those for dialysis machines and dialyzers, have decreased. These cost reductions may be offset by increases in the salaries of dialysis staff and rising costs of land, building, and utilities. As a result, we explored scenarios of increasing or decreasing the estimated HD costs for the MOH and found that the savings could be wiped out if the actual HD costs were 11% lower than our estimated costs. However, if the actual HD costs were 11% higher, the cost differences could be double. Second, certain costs such as for vascular access and PD catheter procedures were based on estimation from a sample of claims data or prices for services in the Malaysian Medical Association Schedule of Fees 5th Edition [17] because there are no data on these costs in the public sector. This approach of shadow pricing according to the Malaysian Medical Association Schedule of Fees for MOH costs is likely to underestimate true costs because the schedule accounts only for surgeon and anesthetist fees. Third, data on hospitalization were unavailable for the analysis. Hence, the costs savings associated with increased PD use might have been underestimated. In the United States, for example, hospital admission rates in recent years are reported to be lower in patients treated with PD than in patients treated with HD [23]. A cost comparison study of 463 dialysis patients, where 12% were patients treated with PD, showed that the rate of hospitalization was less in patients treated with PD than in patients treated with PD in the year following the initiation of dialysis. This was associated with significantly lower health care costs over the 12-month period, that is, $173,507 versus $129,997 (P ¼ 0.03) [24]. Fourth, this model was constructed from the Malaysian government’s perspective and included only dialysis-associated costs
with publicly available information. We did not include cost of treatments for dialysis-associated adverse events, patients’ outof-pocket costs, and caregiver’s burden. Fifth, this model is a prevalence-based model and assumed no modality-switching costs, either from PD to HD or from HD to PD. As a result, unequal switching from one modality to another may diminish or increase the savings when the switching costs were accounted for. Sixth, PD is underused in Malaysia. The expansion of PD with consistently good outcomes is likely to be center-specific and may not generalize to other centers, especially HD-centric centers. As a result, the savings from the increasing use of PD could be diminished. Apart from concerns that the heavy reliance on HD is not economically sustainable in the long-term, the current model of HD provision has a number of associated problems. There is already a severe shortage of trained staff, particularly paramedics, and the gap between requirements for trained staff and available human resources can only widen as the number of patients treated with HD increase. In addition, there is a need for licensing and surveillance to ensure the safety and quality of hemodialysis services. The Malaysian government enforces the provision of the Private Healthcare Facilities and Services Act on hemodialysis treatment through the Private Medical Practice Control Section. This again involves human resource requirements, and, in practice, has encountered many difficulties in enforcement of standards. At present there are gaps in continuity of care of patients such that patients may dialyze elsewhere but most come to public clinics and hospitals for medications, treatment of complications, and, in some instances, blood investigations. Lack of dedicated vascular access surgeons and long waiting times for access surgery have resulted in increased reliance on temporary vascular access catheters with consequent risk of catheter-related bloodstream infections. There are also higher rates of hepatitis seroconversion with HD treatment compared with PD treatment—for example, in 2012, the
Fig. 1 – Cumulative costs for years 2014 to 2018 and total change in costs by scenarios (RM1,000,000). Scenario 1, 2.5% increase in PD use each year for 5 years; scenario 2, 5% increase in PD use each year for 5 years; scenario 3, 7.5% increase in PD use each year for 5 years; scenario 4, 1% decrease in PD use each year for 5 years. RM, Ringgit Malaysia; PD, peritoneal dialysis.
VALUE IN HEALTH REGIONAL ISSUES 9C (2016) 8–14
prevalence of hepatitis B and C was 4% and 5%, respectively, in patients treated with PD versus 3% and 2% in patients treated with PD in Malaysia [6]. HD treatment is also less environmentally friendly because HD generates a lot of wastes and consumes a large amount of water and electricity. Last, as discussed earlier, the current funding model favors the setting up of hemodialysis centers in urban areas or more developed states. Hence, there is inequality in access to dialysis between lesser developed and more developed areas. The Private Medical Practice Control Section has introduced zoning regulations to prohibit further private hemodialysis units from opening in areas already saturated, but it is likely that only the government and nongovernmental organizations will be willing to open HD units in lesser developed areas because of the probability of operating at economic loss. Relying on HD in such unfavorable economic circumstances will further exacerbate the burden on the Malaysian government health care budget. However, PD is a home-based treatment and does not require developing infrastructure such as in HD, for which one needs a building and machines. Hence, PD can be started and expanded quite quickly using existing facilities in the Nephrology services. This would reduce congestion within the hospital. PD does not require as many trained staff as does HD—the recommended nurse-to-patient ratio is 1:25 versus 1:6, respectively. Because it is a home-based treatment, PD will help patients especially in the rural areas who may encounter difficulty accessing HD units. Patients treated with PD are trained to do the treatment themselves and need to see their nurses or doctors only once every 2 to 3 months. In between clinic visits patients can maintain contact with their health care providers through telephone contact, e-mails, SMS, and so forth. PD will also allow patients to return to homemaking or even perform economically productive activities because they do not have to spend time traveling to and staying in HD units for more than 4 hours three times a week. In a local article comparing mean therapy time for PD versus HD that included time traveling for dialysis [25], PD was significantly more time-saving than in-center HD, that is, 194 hours versus 261 hours in a 3-month period (P o 0.0001). Last but not the least, PD is the preferred dialysis modality for children with ESRD because it does not involve the use of needles and is able to offer them more time flexibility to attend school. Hence, based on the results of this budget impact analysis, it is clear that a policy shift toward more intensive utilization of PD as the first line of dialysis therapy would benefit both patients treated with ESRD and the Malaysian government. However, there are several challenges to achieving this shift in dialysis modality mix. These challenges include lack of facilities and dedicated staff for PD access surgery, lack of financial incentives to private nephrologists and dialysis centers to promote PD therapy, lack of public awareness, high cost of imported consumables and limitations to PD technique survival due to peritonitis, changes in the peritoneal membrane over time, and patient or assistant burnout. Pilot test programs on the shift in modality mix may help provide valuable information for the implementation [26]. In addition, future high-quality research on the comparative costs associated with PD versus ICHD from the payer perspective or the societal perspective is needed. The findings of our study were presented to the MOH in 2013 and helped convince Malaysian MOH policymakers of the need to shift to a PD-preferred approach for sustainable dialysis provision in the future. As a result, during the Malaysian 2014 budgeting cycle, the Prime Minister of Malaysia and the Minister of Finance Dato Sri Najib Tun Razak allocated a total of RM16 million for the creation of 635 new PD slots for patients with ESRD nationwide. Thereafter, the Malaysian Society of Nephrology and Baxter Healthcare revived a public awareness campaign “Freedom with PD” in August 2013 to educate the public and promote PD as a first choice for RRT.
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Conclusions Under the current payment structure for dialysis in Malaysia, increasing the proportion of patients on PD versus ICHD could generate substantial savings in dialysis-associated costs to the Malaysian government. Apart from being more economically sustainable in the long-term, a PD-preferred policy for clinically appropriate patients in the setting of an integrated dialysis approach is also a good strategy to address inequity in dialysis access.
Acknowledgments We thank the Malaysian Dialysis and Transplant Registry for access to the data used in this study, and the registry’s manager, Day-Guat Lee, for her assistance. We also thank the Director General of the Malaysian Ministry of Health for permission to publish this article. Source of financial support: The authors have no other financial relationships to disclose. R EF E R EN C ES
[1] Hu FB. Globalization of diabetes: the role of diet, lifestyle, and genes. Diabetes Care 2011;34:1249–57. [2] Finkel ML, Cheung BMY, Ong KL. The challenge of managing hypertension. In: Finkel, ed. Public Health in the 21st Century. Santa Barbara, CA: Praeger Publishing, 2010. [3] Institute for Public Health (IPH). National Health and Morbidity Survey 2011. (NHMS 2011), Vol II. Non-Communicable Diseases: 188 pages. Kuala Lumpur: Institute for Public Health, National Institutes of Health, Ministry of Health Malaysia, 2011. [4] Economic Planning Unit, Prime Minister’s Department, Malaysia. The Malaysian economy in figures 2012. Available from: www.epu.gov.my. [Accessed November 11, 2014]. [5] Lim TO, Goh A, Lim YN, et al. How public and private reforms dramatically improved access to dialysis therapy in Malaysia. Health Aff (Millwood) 2010;29:2214–22. [6] Lim YN, Goh BL, Ong LM, eds. Twenty-First Report of the Malaysian Dialysis and Transplant Registry 2013. Kuala Lumpur: Malaysian Society of Nephrology, 2014. [7] Chiu YW, Jiwakanon S, Lukowsky L, et al. An update on the comparisons of mortality outcomes of hemodialysis and peritoneal dialysis patients. Semin Nephrol 2011;31:152–8. [8] Davies SJ. Peritoneal dialysis—current status and future challenges. Nat Rev Nephrol 2013;9:399–408. [9] Hooi LS, Lim TO, Goh A, et al. Economic evaluation of centre haemodialysis and continuous ambulatory peritoneal dialysis in Ministry of Health hospitals, Malaysia. Nephrology (Carlton) 2005;10:25–32. [10] Neil N, Walker DR, Sesso R, et al. Gaining efficiencies: resources and demand for dialysis around the globe. Value Health 2009;12:73–9. [11] Howard K, Salkeld G, White S, et al. The cost-effectiveness of increasing kidney transplantation and home-based dialysis. Nephrology (Carlton) 2009;14:123–32. [12] Lameire N, Van Biesen W, Vanholder R. The role of peritoneal dialysis as first modality in an integrative approach to patients with end-stage renal disease. Perit Dial Int 2000;Suppl 2:S134–41. [13] Dalal P, Sangha H, Chaudhary K. In peritoneal dialysis, is there sufficient evidence to make “PD first” therapy? Int J Nephrol 2011;2011:239515. [14] Li PK, Chow KM. Peritoneal dialysis-first policy made successful: perspectives and actions. Am J Kidney Dis 2013;62:993–1005. [15] Trading Economics. Malaysia inflation rate. 2014. Available from: http:// www.tradingeconomics.com/malaysia/inflation-cpi. [Accessed March 7, 2014]. [16] Malaysian Department of Statistics. Population estimates by quarterly, ethnic group, and sex—Malaysia. 2014. Available from: http://www. statistics.gov.my/portal/download_Buletin_Bulanan/files/BPBM/2014/ OGO/MALAYSIA/02.Population.pdf. [Accessed May 9, 2014]. [17] Malaysian Medical Association. Schedule of Fees (5th ed.). Kuala Lumpur, Malaysia: Malaysian Medical Association; 2008. [18] Liu F.X., Quock T.P., Burkart J., et al. Economic evaluations of peritoneal dialysis and hemodialysis: 2004-2012. [v1; ref status: approved 1, approved with reservations 1, http://f1000r.es/2fa]. F1000Research 2013;2:273. 10.12688/f1000research.2-273.v1.
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[19] Liu FX, Walton SM, Leopold R, et al. Financial implications to Medicare from changing the dialysis modality mix under the bundled prospective payment system. Perit Dial Int 2014;34:749–57. [20] Jung B, Blake PG, Mehta RL, et al. Attitudes of Canadian nephrologists toward dialysis modality selection. Perit Dial Int 1999;19:263–8. [21] Mendelssohn DC, Mullaney SR, Jung B, et al. What do American nephologists think about dialysis modality selection? Am J Kidney Dis 2001;37:22–9. [22] Jassal SV, Krishna G, Mallick NP, et al. Attitudes of British Isles nephrologists towards dialysis modality selection: a questionnaire study. Nephrol Dial Transplant 2002;17:474–7. [23] United States Renal Data System. USRDS 2012 Annual Data Report: Atlas of Chronic Kidney Disease and End-Stage Renal Disease in the United States, National Institutes of Health, National Institute of
Diabetes and Digestive and Kidney Disease. Bethesda, MD: U.S. Renal Data System, 2012. Available from: http://www.usrds.org/adr.aspx. [24] Berger A, Edelsberg J, Inglese GW, et al. Cost comparison of peritoneal dialysis versus hemodialysis in end-stage renal disease. Am J Manag Care 2009;15:509–18. [25] Yaw CH, Bavanandan S, Ahmad G. A time-motion study of patients in centre haemodialysis and continuous ambulatory peritoneal dialysis in Nephrology Department Hospital Kuala Lumpur (HKL). Presented at: the 14th Congress of the International Society of International Peritoneal Dialysis; Kuala Lumpur, 2012. [26] Liu FX, Gao X, Inglese G, et al. A global overview of the impact of peritoneal dialysis first or favored policies: an opinion [published online ahead of print July 31, 2014]. Perit Dial Int. 10.3747/pdi.2013.00204.
Available online at www.sciencedirect.com
journal homepage: www.elsevier.com/locate/vhri
Budget Impact Analysis of Peritoneal Dialysis versus Conventional In-Center Hemodialysis in Malaysia Sunita Bavanandan, MD1,*, Ghazali Ahmad, MD1, Ai-Hong Teo, BSc2, Lilian Chen, MD3, Frank Xiaoqing Liu, Ph.D.4 1 Department of Nephrology, Kuala Lumpur Hospital, Kuala Lumpur, Malaysia; 2Baxter Healthcare (M) Sdn Bhd, Kuala Lumpur, Malaysia; 3Baxter Healthcare Ltd., Shanghai, China; 4Baxter Healthcare Corporation, Deerfield, IL, USA
AB STR A CT
Objectives: To investigate the 5-year health care budget impact of variable distribution of adult patients treated with peritoneal dialysis (PD) and in-center hemodialysis (ICHD) on government funding in Malaysia. Methods: An Excel-based budget impact model was constructed to assess dialysis-associated costs when changing dialysis modalities between PD and ICHD. The model incorporates the current modality distribution and accounts for Malaysian government dialysis payments and erythropoiesis-stimulating agent costs. Epidemiological data including dialysis prevalence, incidence, mortality, and transplant rates from the Malaysian renal registry reports were used to estimate the dialysis patient population for the next 5 years. The baseline scenario assumed a stable distribution of PD (8%) and ICHD (92%) over 5 years. Alternative scenarios included the prevalence of PD increasing by 2.5%, 5.0%, and 7.5% or decreasing 1% yearly over 5 years. All four scenarios were accompanied with commensurate
changes in ICHD. Results: Under the current best available cost information, an increase in the prevalent PD population from 8% in 2014 to 18%, 28%, or 38% in 2018 is predicted to result in 5-year cumulative savings of Ringgit Malaysia (RM) 7.98 million, RM15.96 million, and RM23.93 million, respectively, for the Malaysian government. If the prevalent PD population were to decrease from 8% in 2014 to 4.0% by 2018, the total expenditure for dialysis treatments would increase by RM3.19 million over the next 5 years. Conclusions: Under the current cost information associated with PD and HD paid by the Malaysian government, increasing the proportion of patients on PD could potentially reduce dialysis-associated costs in Malaysia. Keywords: budget impact, in-center hemodialysis, peritoneal dialysis.
Introduction
gross domestic product of US $9983 per capita in 2012 [4]. Provision of RRT consumes a disproportionate amount of the health care budget—for example, in 2005, 0.06% of the Malaysian population with ESRD accounted for 1.72% of its total health care spending [5]. In 2013, a total of 33,519 prevalent patients with ESRD received RRT [6], but this figure is projected to double to 50,000 by 2020. Renal transplantation, that is, the surgical procedure to place a healthy donated kidney in the patient with ESRD, is the best RRT option. However, the new transplant rate in Malaysia is very low at 3 per million population (pmp) in 2013. Hence, most of the patients require dialysis therapy. In 2012, 94% of the patients on RRT were on dialysis therapy, with 92% on HD and 8% on PD [6]. In HD, blood obtained from the patient via a surgically created connection, for example, an arteriovenous fistula, is dialyzed across an artificial membrane in a dialyzer that is connected to a circuit outside the patient’s body. In PD, the peritoneal membrane lining the patient’s peritoneal cavity acts as a natural filter for wastes and excess fluids. PD dialysis solutions are instilled and removed via a permanent catheter placed through the abdominal wall into the peritoneal cavity. The PD solution
The global epidemic of chronic kidney disease poses a major public health problem not only in high-income countries but also in Asia. This problem is driven by the aging population, the global diabetes epidemic in which Asia has emerged as an epicenter [1], as well as the high prevalence of hypertension among Asians [2]. Similar trends are seen in Malaysia where National Health and Morbidity surveys have shown that the prevalence of diabetes among adults 18 years and older increased from 11.6% in 2006 to 14.2% in 2011 and the prevalence of hypertension rose from 32.2% to 32.7% [3]. Patients with chronic kidney disease who reach the final stage of kidney failure known as end-stage renal disease (ESRD) will require renal replacement therapy (RRT) by either hemodialysis (HD) or peritoneal dialysis (PD) or renal transplantation to sustain life. However, the provision of RRT is costly and has become a serious, escalating burden on the finances and human resources of health care systems worldwide. Malaysia is an upper-middle income developing country in Southeast Asia with a population of 29.3 million and an annual
Copyright & 2015, International Society for Pharmacoeconomics and Outcomes Research (ISPOR). Published by Elsevier Inc.
Conflict of interest: The authors have indicated that they have no conflicts of interest with regard to the content of this article. * Address correspondence to: Sunita Bavanandan, Hospital Kuala Lumpur, Jalan Pahang, Kuala Lumpur 50586, Malaysia. E-mail: [email protected]. 2212-1099$36.00 – see front matter Copyright & 2015, International Society for Pharmacoeconomics and Outcomes Research (ISPOR). Published by Elsevier Inc. http://dx.doi.org/10.1016/j.vhri.2015.06.003
VALUE IN HEALTH REGIONAL ISSUES 9C (2016) 8–14
exchanges are done manually with minimal equipment three to five times daily in continuous ambulatory PD (CAPD) or overnight with the assistance of an automated cycler (automated PD [APD]). In Malaysia, the provision of dialysis is via a public-private mix in health care. Although the Ministry of Health (MOH) remains to date as the largest single institutional provider for dialysis, the ministries of defense and higher education also provide dialysis to their employees and associated dependents. Historically, long-term HD in the MOH began in 1969 with very limited facilities at the main tertiary referral hospital in the country. Out of necessity, home HD was introduced in which patients bought their own machines but the government provided disposables, saline, and heparin. Office HD programs were also initiated in government departments such as the Ministry of Education and Treasury to enable department employees or their family members to obtain dialysis services, as well as minimize the risk of employees losing their jobs because of frequent leave for dialysis elsewhere. This also occurred in the armed forces and police where dialysis units were opened to cater to the needs of their personnel and dependents. This is how the provision of HD services by various government agencies such as the MOH, the Ministry of Education, and the armed forces evolved. In addition, several large corporations such as Malaysian Banking, Bank Bumiputera now Commerce International Merchant Bankers (CIMB), and Malaysian Airlines also provided office HD. However, as access to in-center HD services expanded, home HD and office HD have largely been replaced by HD performed in hospitals or freestanding hemodialysis centers. Although public, private, and nongovernmental organizations provided 30%, 45%, and 25% of overall dialysis treatment in 2012, respectively, the overall government funding constituted at least 58% of the total expenditure for dialysis in the country [6]. Growth of dialysis provision by the private sector has been the most rapid, and this has been mainly sustained by government funding through various agencies, predominantly the Public Service Department and the Social Security Organization, the latter being a government-run social insurance organization that receives mandatory contributions for employees in the private sector. Despite a remarkable growth in dialysis provision rates by more than 10-fold between 1993 and 2012, Malaysia is still unable to provide universal access to RRT [6]. With the expected rise in the prevalence of ESRD, the sustainability of dialysis therapy in the future is uncertain. In addition, there is an imbalance in dialysis treatment rates between geographical regions. Although the overall prevalence rate of patients on dialysis was 1019 pmp in 2013, states on the economically developed west coast of Peninsular Malaysia have a very high treatment rate ranging from 962 to 1585 ppm, whereas Sabah, Sarawak, and the east coast states of Peninsular Malaysia have far lower treatment rates ranging from 438 to 907 pmp [6]. PD is as effective as HD in the treatment of patients [7,8], and an economic evaluation conducted in government hospitals in Malaysia in 2003 has shown that the cost per life-year saved is slightly less for PD than for in-center HD (ICHD) (Ringgit Malaysia [RM] 31,635 vs. RM33,642) [9]. Studies using modeling methods for other countries have shown that where PD costs are less than HD costs, increased PD utilization would result in substantial health care savings [10,11]. In Malaysia, increasing PD utilization would also address inequality in dialysis access by allowing patients in rural areas and small towns, where HD is scarce or nonexistent, to obtain dialysis treatment. In addition, PD offers a number of medical advantages over HD. These include better preservation of residual renal function, less risk of bacteremia and sepsis, better quality of life, better hemodynamic stability, less requirements for erythropoetin-stimulating agents (ESAs), improved survival advantage in the first 2 years of RRT, and improved transplant outcomes [12–14].
9
In 2012, a small working group of nephrologists was formed in the MOH to prepare a proposal for the Malaysian government to encourage increased use of PD. As a part of this initiative, this study was conducted to explore the 5-year health care budget impact of a variable mix of dialysis modalities of PD and HD to treat adult patients with ESRD in Malaysia. The information obtained may facilitate financial planning and health policy decisions regarding health care allocations for a more sustainable dialysis treatment program in the future.
Methods An Excel-based budget impact model was developed to estimate the dialysis-associated costs from the perspective of the Malaysian federal government, assuming various dialysis modality mixes between PD and ICHD over 5 years. The period of 5 years was chosen because this is the same duration as the Malaysian government’s economic development plans—the nation is presently in the Tenth Malaysian Plan, which spans from 2011 to 2015. The dialysis population that is covered by the Malaysian government changes year by year. Taking account of patients with ESRD both entering and leaving dialysis, the baseline dialysis population in each year was estimated using linear regression on the prevalence (pmp) of dialysis patients obtained from the Malaysian Dialysis and Transplant Registry for the past 10 years from 2003 to 2012 [6]. The entry rate in each year was estimated by projecting the incidence (pmp) of dialysis patients from 2003 to 2012, whereas the leaving rates accounted for both mortality (per 1000 patient-years) and kidney transplantation for the same period [6]. Over the last decade, the number of new transplant patients has been decreasing consistently. Using the past 10-year trend generates negative transplants in the near future, which is not logical. As a result, we assumed that the transplant number will remain constant between 2014 and 2018 by using the 2012 number. In addition, we assumed that all transplants are performed in government centers because over the last 20 years, 94% of local transplants have been performed in government hospitals [6]. Partial-year patients, including both the entering and leaving patients with ESRD, were assumed to be distributed uniformly throughout the year. Therefore, the costs and resource use of these patients were counted as half of those of full-year patients. In the baseline model, among the 58% of the total dialysis patients funded by the government agencies, 8% of them were assumed to receive PD and 92% ICHD over 5 years in alignment with 2013 Malaysian Dialysis and Transplant Registry data [6]. Three hypothetical scenarios were compared with this reference scenario. The first scenario was an increase in the use of PD by 2.5% per year over 5 years. The second was an increase in the use of PD by 5.0% per year, and the third was an increase in the use of PD by 7.5% per year over 5 years. For comparison, a scenario of decreasing the use of PD by 1.0% each year for 5 years was also analyzed. In each of the four hypothetical scenarios, ICHD percentages were adjusted so that the total percentage of PD and ICHD remained constant at 100% (Table 1). The dialysis-associated costs accounted in the model included dialysis access, dialysis services, and ESA use. Four types of HD vascular access exist in Malaysia: noncuffed catheter, cuffed catheter, arteriovenous fistula, and arteriovenous graft. Therefore, different access costs were weighted to impute one HD access cost as the final model input. In addition, there are several government agencies paying for dialysis in Malaysia, including the MOH, the Public Service Department, the Social Security Organization, and other government agencies (e.g., the Department of Defense). Each agency pays for the same service, for example, supply of ESA, with a different price. Therefore, our
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Table 1 – Current Malaysia dialysis modality distribution and patient distribution scenarios considered in the budget impact analysis. Scenario
Yearly PD/HD ratio (%)
Reference scenario Scenario 1 (2.5% annual PD use increase) Scenario 2 (5% annual PD use increase) Scenario 3 (7.5% annual PD use increase) Scenario 4 (1% annual PD use decrease)
2014
2015
2016
2017
2018
8/92 8/92 8/92 8/92 8/92
8/92 10.5/89.5 13/87 15.5/84.5 7/93
8/92 13/87 18/82 23/77 6/94
8/92 15.5/84.5 23/77 30.5/69.5 5/95
8/92 18/82 28/72 38/62 4/96
HD, hemodialysis; PD, peritoneal dialysis.
model weighted the different payments of each service from all the government agencies mentioned above on the basis of the number of dialysis patients covered by each agency. Furthermore, the MOH pays for the treatment of PD and HD in different ways. For PD, the MOH pays one price that covers PD solutions, disposables, home delivery, and home care. For HD, the national tendering determines the price for the different HD elements, such as dialysis machines, dialyzers, tubing sets, and arteriovenous needles. We did not have detailed data to weight all the different prices with the dialysis population funded by other government agencies. We instead used the HD costs from a published article [9] by excluding the ESA costs and hospitalization to match the MOH PD national price, which does not include the ESA cost and hospitalization. All the costs, if not presented in 2014 prices, were inflated to 2014 on the basis of the consumer price index published for Malaysia [15].
Results Table 2 presents the sizes of the dialysis populations that are covered by the Malaysian federal government based on a projection using the epidemiological parameters reported in Malaysian Dialysis and Transplant Registry annual reports and methods previously discussed. The projected dialysis population was around 18,000 dialysis patients covered by the Malaysian federal government at the start of 2014. The number is projected to increase to about 24,000 by the end of 2018. Table 3 presents the model inputs. As previously discussed in the Methods section, all input costs were weighted by the percentage of patient population covered by different government agencies and adjusted, where necessary, to costs in 2014 on the basis of the Malaysian consumer price index. For example, after weighting the monthly payment by different government agencies, PD costs about RM2508/month taking into account the
situation in Malaysia that the Public Service Department and the Social Security Organization cover both APD and CAPD, which have different costs, but the MOH and other government agencies cover CAPD only. Overall, CAPD accounts for 85% of the patients treated with PD and APD accounts for the remaining 15%. The final model input for PD is RM82.46 per day. Table 4 presents the cost results by category for the four hypothetical scenarios and the reference scenario, including dialysis-associated costs, 5-year cumulative cost differences, and annual cost differences. For the reference scenario, the estimated 5-year payment from the Malaysian federal government was about RM3.85 billion, including dialysis access, treatments, and ESA use. With the different scenarios of low, medium, and high increases in the use of PD, the cumulative savings to the Malaysian federal government varied from RM7.98 million to RM23.93 million over 5 years (2014–2018). In the scenario of lower PD use, costs were projected to increase by RM3.19 million. The 5year cumulative cost differences of the four hypothetical scenarios versus the reference scenario are also displayed in Figure 1.
Discussion Between 1994 and 2013, Malaysia succeeded in increasing the dialysis treatment provision rate by more than 10-fold from 440 to 1019 pmp, a level comparable with that in many high-income countries. However, HD is a more costly treatment compared with PD because it has high fixed costs (structure and human resources), whereas PD, in particular CAPD, has low fixed costs, but high variable costs (supplies) and a low need for investments [18]. Although the average ESA dose for patients treated with PD is lower than that for patients treated with HD [6], the administration of ESAs to patients treated with PD is limited to the subcutaneous route. Hence, all patients treated with PD are on
Table 2 – Projected dialysis population covered by the Malaysian government. Stock and flow of renal replacement therapy
Dialysis patients at start of year Incident dialysis patients Dialysis deaths Transplants Dialysis patients at end of year
Year 2014
2015
2016
2017
2018
17,992 4,104 2,159 94 19,112
19,112 4,316 2,301 94 20,232
20,232 4,528 2,444 94 21,352
21,352 4,739 2,588 94 22,472
22,472 4,951 2,733 94 23,592
Note. These counts are based on a total estimated Malaysian population size of 30,175,100 from the Malaysia Department of Statistics [16]. Among all the dialysis patients in Malaysia, funding from the federal government accounts for 58% of the patients with ESRD [6]. The incident dialysis patients, dialysis deaths, and transplants represent flows in and out of the dialysis population in Malaysia. ESRD, end-stage renal disease.
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Table 3 – Model inputs and associated sources. Dialysis-associated costs
PD cost/d
HD costs/session
ESA costs/1000 units
HD access costs
Final model input (RM)
Model input sources Government agency
Cost (RM)
Sample size weight*
MOH PSD SOCSO Other government agency
2097.2/mo‡ 3567.6/mo§ 2687.2/mo§ 2600.0/mo||
0.58 0.19 0.16 0.08
MOH PSD SOCSO
195/session¶ 200/session# 149/session#
0.41 0.35 0.24
MOH PSD SOCSO Other government agency
11.06/session** 40/session# 15/session# 40/session#
0.43 0.16 0.23 0.18
MOH
1882.2/ procedure†† 3237/procedure‡‡ 1882.2/ procedure†† 3237/procedure‡‡
0.26
82.46†
185.47
21.68
2471.13
PSD SOCSO Other government agency PD access costs ESA dose for a patient with PD per week ESA dose for a patient with HD per week
0.26 0.31 0.17
1445.47§§ 4000* 6000*
APD, automatic peritoneal dialysis; CAPD, continuous ambulatory peritoneal dialysis; ESA, erythropoiesis-stimulating agent; FMC, Fresenius Medical Care; HD, hemodialysis; MOH, Ministry of Health; PD, peritoneal dialysis; PSD, Public Service Department; RM, Ringgit Malaysia; SOCSO, Social Security Organization. * Sample size weight from Malaysian Dialysis and Transplant Registry (MDTR) Annual Data report [6]. † Calculated by multiplying the weighted monthly costs of RM2508 by 12 and then dividing by 365. ‡ Weighted by 70% Baxter CAPD (RM25,001.4/y) and 30% FMC CAPD (RM25,551.96/y) based on government national CAPD tender award 20132015 in the ratio Baxter:FMC of 70%:30% and the tender prices quoted by the respective firms. § Weighted costs for APD and CAPD by the patient number reported in the MDTR [6]. || Market price quoted to other government agencies by Baxter and FMC. ¶ Data from previous publication by Hooi et al. [9] and inflated to 2014 costs on the basis of the consumer price index after excluding ESA and hospitalization costs [15]. # Based on reimbursements to private dialysis facilities. ** Estimated on the basis of the national tendering price of RM15.83/2000 units for patients treated with HD (81%) and RM26.80/2000 units for patients treated with PD (19%). †† Estimated on the basis of 5.1% of HD noncuffed catheter (RM790), 3% HD cuffed catheter (RM1265), 90% arteriovenous fistulas [AVFs] (RM1950), and 1.9% arteriovenous grafts [AVGs] (RM2575), adjusted for annual inflation of 2.25% [6,15,17]. An assumption was made that all SOCSO patients obtain vascular access surgery at MOH hospitals. ‡‡ Estimated on the basis of 5.1% of HD noncuffed catheter (RM1000), 3% HD cuffed catheter (RM 3000), 90% AVF (RM3250), and 1.9% AVG (RM 9000) [6]. Costs were based on a sampling of claims forwarded from the PSD to the National Head of Nephrology Services for verification and endorsement. §§ Inflated from 2008 costs of RM1265 [15,17].
beta erythropoietin, which is more expensive than alpha erythropoietin, and this reduces overall cost savings. Our study has shown that increasing the proportion of patients on PD can potentially reduce future dialysis-associated costs. The cumulative cost savings for the Malaysian government generated by increasing PD utilization from the current 8% in 2012 to 18%, 28%, and 38% over 5 years are projected to be RM7.98 million, RM15.96 million, and RM23.93 million, respectively. The cost savings were driven by lower ESA costs and access costs associated with PD versus ICHD. Our findings are similar to those of other studies, which have also demonstrated significant cost savings [10,11,19]. In our local setting, the costs savings achieved can be used to treat 50 to 150 more patients with ESRD annually.
Alternatively, cost savings may be channeled into other competing therapies for chronic illnesses. The model was constructed with a simple concept of estimating the financial impact on the payer by varying the modality distribution between PD and HD. We included publicly available cost information in Malaysia, including dialysis access, dialysis service, and ESA, and did not include some other cost elements, such as in-patient and oral drugs, because of lack of data. With our target of increasing PD utilization up to a maximum of 28% and 38%, substantial savings have been found. This PD versus HD distribution was in line with published literature regarding nephrologists’ opinions on the optimal PD:HD utilization ratio. In Canada and North America [20,21], the opinion on the
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Table 4 – Cumulative costs for years 2014–2018 and change in costs by scenarios (RM1,000,000). Cumulative costs and cost differences
Dialysis Drugs* Total Cost difference vs. reference scenario Annual cost difference
Scenario Reference
Scenario 1
Scenario 2
Scenario 3
Scenario 4
3147.40 701.07 3848.46
3152.08 688.41 3840.48 7.98 1.60
3156.75 675.75 3832.51 15.96 3.19
3161.43 663.09 3824.53 23.93 4.79
3145.52 706.13 3851.65 3.19 0.64
RM, Ringgit Malaysia. * Drug costs reflect the use of erythropoiesis-stimulating agent.
optimum PD:HD ratio is 35:65, whereas in the United Kingdom [22] it is 40:60. Our study has a number of limitations. First, a major limitation is the reliance on a local economic evaluation conducted 10 years ago for HD costs [9], albeit with adjustment for inflation rates and for the current costs of ESA therapy. Since 2003, many costs, including those for dialysis machines and dialyzers, have decreased. These cost reductions may be offset by increases in the salaries of dialysis staff and rising costs of land, building, and utilities. As a result, we explored scenarios of increasing or decreasing the estimated HD costs for the MOH and found that the savings could be wiped out if the actual HD costs were 11% lower than our estimated costs. However, if the actual HD costs were 11% higher, the cost differences could be double. Second, certain costs such as for vascular access and PD catheter procedures were based on estimation from a sample of claims data or prices for services in the Malaysian Medical Association Schedule of Fees 5th Edition [17] because there are no data on these costs in the public sector. This approach of shadow pricing according to the Malaysian Medical Association Schedule of Fees for MOH costs is likely to underestimate true costs because the schedule accounts only for surgeon and anesthetist fees. Third, data on hospitalization were unavailable for the analysis. Hence, the costs savings associated with increased PD use might have been underestimated. In the United States, for example, hospital admission rates in recent years are reported to be lower in patients treated with PD than in patients treated with HD [23]. A cost comparison study of 463 dialysis patients, where 12% were patients treated with PD, showed that the rate of hospitalization was less in patients treated with PD than in patients treated with PD in the year following the initiation of dialysis. This was associated with significantly lower health care costs over the 12-month period, that is, $173,507 versus $129,997 (P ¼ 0.03) [24]. Fourth, this model was constructed from the Malaysian government’s perspective and included only dialysis-associated costs
with publicly available information. We did not include cost of treatments for dialysis-associated adverse events, patients’ outof-pocket costs, and caregiver’s burden. Fifth, this model is a prevalence-based model and assumed no modality-switching costs, either from PD to HD or from HD to PD. As a result, unequal switching from one modality to another may diminish or increase the savings when the switching costs were accounted for. Sixth, PD is underused in Malaysia. The expansion of PD with consistently good outcomes is likely to be center-specific and may not generalize to other centers, especially HD-centric centers. As a result, the savings from the increasing use of PD could be diminished. Apart from concerns that the heavy reliance on HD is not economically sustainable in the long-term, the current model of HD provision has a number of associated problems. There is already a severe shortage of trained staff, particularly paramedics, and the gap between requirements for trained staff and available human resources can only widen as the number of patients treated with HD increase. In addition, there is a need for licensing and surveillance to ensure the safety and quality of hemodialysis services. The Malaysian government enforces the provision of the Private Healthcare Facilities and Services Act on hemodialysis treatment through the Private Medical Practice Control Section. This again involves human resource requirements, and, in practice, has encountered many difficulties in enforcement of standards. At present there are gaps in continuity of care of patients such that patients may dialyze elsewhere but most come to public clinics and hospitals for medications, treatment of complications, and, in some instances, blood investigations. Lack of dedicated vascular access surgeons and long waiting times for access surgery have resulted in increased reliance on temporary vascular access catheters with consequent risk of catheter-related bloodstream infections. There are also higher rates of hepatitis seroconversion with HD treatment compared with PD treatment—for example, in 2012, the
Fig. 1 – Cumulative costs for years 2014 to 2018 and total change in costs by scenarios (RM1,000,000). Scenario 1, 2.5% increase in PD use each year for 5 years; scenario 2, 5% increase in PD use each year for 5 years; scenario 3, 7.5% increase in PD use each year for 5 years; scenario 4, 1% decrease in PD use each year for 5 years. RM, Ringgit Malaysia; PD, peritoneal dialysis.
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prevalence of hepatitis B and C was 4% and 5%, respectively, in patients treated with PD versus 3% and 2% in patients treated with PD in Malaysia [6]. HD treatment is also less environmentally friendly because HD generates a lot of wastes and consumes a large amount of water and electricity. Last, as discussed earlier, the current funding model favors the setting up of hemodialysis centers in urban areas or more developed states. Hence, there is inequality in access to dialysis between lesser developed and more developed areas. The Private Medical Practice Control Section has introduced zoning regulations to prohibit further private hemodialysis units from opening in areas already saturated, but it is likely that only the government and nongovernmental organizations will be willing to open HD units in lesser developed areas because of the probability of operating at economic loss. Relying on HD in such unfavorable economic circumstances will further exacerbate the burden on the Malaysian government health care budget. However, PD is a home-based treatment and does not require developing infrastructure such as in HD, for which one needs a building and machines. Hence, PD can be started and expanded quite quickly using existing facilities in the Nephrology services. This would reduce congestion within the hospital. PD does not require as many trained staff as does HD—the recommended nurse-to-patient ratio is 1:25 versus 1:6, respectively. Because it is a home-based treatment, PD will help patients especially in the rural areas who may encounter difficulty accessing HD units. Patients treated with PD are trained to do the treatment themselves and need to see their nurses or doctors only once every 2 to 3 months. In between clinic visits patients can maintain contact with their health care providers through telephone contact, e-mails, SMS, and so forth. PD will also allow patients to return to homemaking or even perform economically productive activities because they do not have to spend time traveling to and staying in HD units for more than 4 hours three times a week. In a local article comparing mean therapy time for PD versus HD that included time traveling for dialysis [25], PD was significantly more time-saving than in-center HD, that is, 194 hours versus 261 hours in a 3-month period (P o 0.0001). Last but not the least, PD is the preferred dialysis modality for children with ESRD because it does not involve the use of needles and is able to offer them more time flexibility to attend school. Hence, based on the results of this budget impact analysis, it is clear that a policy shift toward more intensive utilization of PD as the first line of dialysis therapy would benefit both patients treated with ESRD and the Malaysian government. However, there are several challenges to achieving this shift in dialysis modality mix. These challenges include lack of facilities and dedicated staff for PD access surgery, lack of financial incentives to private nephrologists and dialysis centers to promote PD therapy, lack of public awareness, high cost of imported consumables and limitations to PD technique survival due to peritonitis, changes in the peritoneal membrane over time, and patient or assistant burnout. Pilot test programs on the shift in modality mix may help provide valuable information for the implementation [26]. In addition, future high-quality research on the comparative costs associated with PD versus ICHD from the payer perspective or the societal perspective is needed. The findings of our study were presented to the MOH in 2013 and helped convince Malaysian MOH policymakers of the need to shift to a PD-preferred approach for sustainable dialysis provision in the future. As a result, during the Malaysian 2014 budgeting cycle, the Prime Minister of Malaysia and the Minister of Finance Dato Sri Najib Tun Razak allocated a total of RM16 million for the creation of 635 new PD slots for patients with ESRD nationwide. Thereafter, the Malaysian Society of Nephrology and Baxter Healthcare revived a public awareness campaign “Freedom with PD” in August 2013 to educate the public and promote PD as a first choice for RRT.
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Conclusions Under the current payment structure for dialysis in Malaysia, increasing the proportion of patients on PD versus ICHD could generate substantial savings in dialysis-associated costs to the Malaysian government. Apart from being more economically sustainable in the long-term, a PD-preferred policy for clinically appropriate patients in the setting of an integrated dialysis approach is also a good strategy to address inequity in dialysis access.
Acknowledgments We thank the Malaysian Dialysis and Transplant Registry for access to the data used in this study, and the registry’s manager, Day-Guat Lee, for her assistance. We also thank the Director General of the Malaysian Ministry of Health for permission to publish this article. Source of financial support: The authors have no other financial relationships to disclose. R EF E R EN C ES
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