Volume 41 Number 2

Introduction

Faecal ostomy surgery is performed to treat both acute (e.g., trauma) and chronic (e.g., colorectal cancer, Crohn’s disease, ulcerative colitis) conditions. While effective for the underlying issue(s), an ostomy also has its own risk of complications, including peristomal skin complications (PSC) such as: mechanical, e.g., stripping or abraded skin; irritant dermatitis, typically caused by leakage that exposes the skin to ileostomy output; and infectious dermatitis. PSC are among the most commonly reported complications among ostomates, and may occur at any time following stoma creation^1–3. Between 33.5% and 78.7% of ostomates report PSC^4–11; one study estimated that 40% of consultations to ostomy clinics were for PSC^12,. In 2011, the mean costs of care for PSC were estimated to range per ostomy from €32.45 for mild cases to €147.17 for severe cases, and the mean total costs of care (including ostomy pouching systems, accessories, visits to healthcare providers, hospitalisation and medications) over 7 weeks were shown to be approximately 22% greater among patients who experienced PSC versus those who did not⁵. PSC are also associated with deleterious impacts to quality of life, with a “loss” of approximately 11 quality-adjusted life-days (QALDs)/month for patients with severe PSC (versus no PSC)¹³.

CeraPlus^TM is a novel skin barrier with Remois technology (Alcare Co Ltd, Sumida-ku, Tokyo, Japan) currently marketed by Hollister Inc. (Libertyville, Illinois, US). It is a ceramide-infused barrier (CIB) designed to support healthy peristomal skin. Ceramides are naturally occurring lipids that are essential to the barrier function of the skin and lipid bilayer of the stratum corneum^14,15, and play an important role in the prevention of transepidermal water loss (TEWL) by fusing with corneocytes in the stratum corneum to help form a protective layer^16,17.

In the ADVOCATE trial¹⁵ (a study determining variances in ostomy skin conditions and the economic impact: NCT02401412), 153 adults with healthy peristomal skin who had recently undergone ostomy surgery were randomly assigned to use CIB (n=79) or an alternative barrier (New Image FlexWear or New Image Flextend [Hollister Inc.]) (n=74). Over a maximum follow-up of 12 weeks (patients were assessed over 8 weeks, with those who experienced PSC observed for an additional 4-week “resolution period”), the mean costs of care among patients randomised to CIB were US$36.36 less than those randomised to control barrier (US$223.73 vs. US$260.19; p=0.017); they also were nominally less likely to experience PSC during follow-up¹⁵. A subsequent cost-effectiveness analysis indicated that the use of CIB among a hypothetical cohort of 100 Australian patients was expected, over 1 year, to result in 16 fewer PSC, an additional 35 QALDs, and a reduction in healthcare costs of A$13,700 (all versus standard of care [SoC]); the resulting net monetary benefit was A$17,400, indicating that CIB was a cost-effective alternative to SoC¹⁸.

Study/publication purpose

While CIB has been found to be cost-effective versus other barriers in both ADVOCATE and subsequent economic modelling, healthcare payers must also consider the overall expected impact to budgets (i.e., affordability) associated with the adoption of new technologies. Practitioners play an important role in the care of new ostomates, and are often asked to balance patients’ needs with cost-containment pressures imposed upon them by payers. Accordingly, findings presented herein are likely of great interest to nurse clinicians and other providers of care for this vulnerable population as it uses published information on patient-level efficacy and on the safety of CIB to estimate their expected value to payers.

To examine this and related questions, we developed a decision-analytic model that could estimate the budget impact associated with the use of CIB in lieu of other skin barriers. This model was estimated for the United States (US), the United Kingdom (UK), Sweden, Australia, Italy and Norway, based on information from ADVOCATE and supplemented with other sources where appropriate.

Methods and Procedures

Model overview

All patients were assumed to begin the model within 12 weeks of faecal stoma surgery outside hospital settings using either a CIB pouching system or a SoC system. The distribution of patients by ostomy type was assumed to be consistent with that reported by ADVOCATE and to be similar between patients who would use CIB versus SoC – 39%, 52% and 9% of subjects randomised to CIB in ADVOCATE had undergone ileostomy, colostomy and urostomy, respectively; corresponding values for subjects randomised to SoC were 36%, 54% and 10%, respectively; p=0.97¹⁵. We did not differentiate between type of ostomy as there was no statistically significant difference in the distribution of ostomy type at baseline in the ADVOCATE trial.

The model calculated the expected total 1-year ostomy-related medical costs under two alternative scenarios – one in which all patients were assumed to use barriers other than CIB (the SoC scenario), and one in which a percentage of patients were assumed to use CIB in lieu of SoC (the CIB scenario). We assumed that the SoC scenario represented any number of barriers from multiple manufacturers. Ostomy-related costs include ostomy pouching systems, ostomy accessories and PSC management, such as: specialist and nurse visits; facility fees (for US and Australia); topical steroids and antibiotics; and additional use of barriers, pouches and accessories due to increased frequency of barrier change. Budget impact was estimated by subtracting the total expected ostomy-related costs under the SoC scenario from those under the CIB scenario. The time horizon for the model was 1 year (i.e., 12 30-day months). Model programming was consistent with recommendations on budget impact analyses¹⁹. A schematic of the model is presented in Figure 1; key modelling assumptions are presented in Table 1.

Figure 1. Model schematic

Table 1. Key modelling assumptions

Ostomy pouching systems and accessories

The use of ostomy pouching systems was based on country-specific information, as were the costs of healthcare services, including the 2018 Medicare schedule (US), the 2017–18 National Schedule of Reference Costs, NHS Trust and NHS Foundation Trusts (UK), the 2018 Regionala Priser Och Ersättningar för Södra Sjukvårdsregionen (Sweden), the 2019 (June) Stoma Appliance Scheme Schedule (Australia)²⁰, the Sistema Socio Sanitario – Regione Lombardia (ATS Milano Città Metropolitana) (Italy), and the 2019 (January) Produkt-og Prisliste Refusjonsberettiget etter §5–14 Medisinsk Forbruksmateriell ved Stomi (Norway). Except for the UK, costs of CIB pouching systems were assumed equivalent to those of SoC systems. Values for all relevant parameters are provided in Appendix A.

The use of ostomy accessories (e.g., flat rings, ostomy belts, adhesive remover spray) was based on information from ADVOCATE unless more relevant country-specific data were available (Table 2). Accessory use was captured by means of an ‘average accessory use profile’ based on percentages of patients assumed to use each accessory, and the corresponding number of units and cost. Accessory use was assumed dependent on weekly frequency of change of pouching system.

Table 2. Accessory use, by country

* Calculated using the average of the number of ostomy system changes per week, weighted by the proportions receiving one- and two-piece systems respectively.

PSC incidence

Consistent with ADVOCATE, we assumed that 55% of SoC patients and 41% of CIB patients would experience PSC; PSC severity distributions were taken from ADVOCATE (Figure 2). Given its relatively short follow-up, ADVOCATE was not used to estimate probability of a second PSC. Accordingly, we arbitrarily assumed that 10% of CIB patients would experience a second PSC, that the 5% risk difference observed in ADVOCATE was constant, and therefore that 15% of SoC patients would experience a second PSC. We also assumed that addition of accessories following the initial PSC would reduce the risk of subsequent PSC by 50% (i.e., 7.5% for SoC; 5% for CIB). The severity of the second PSC was dependent on that of the first (Table 3).

Figure 2. Distribution of PSC severity by barrier received

Table 3. Severity distribution of second PSC based on severity of first PSC

As per ADVOCATE, the time to PSC resolution was assumed to be 18 days for mild cases (defined in ADVOCATE as a Discoloration, Erosion, Tissue overgrowth [DET] score <4), and 33 days for moderate cases (4≤ DET <7) and severe cases (DET ≥7). Time to resolution was assumed invariant to barrier choice. Patterns of use of various healthcare services during PSC were based on information from ADVOCATE; while one-piece pouching systems were not evaluated, we assumed that these barriers would perform similarly to their two-piece counterparts. As per ADVOCATE, we assumed that the use of pouching supplies among CIB patients would increase by 29% for mild PSC, by 83% for moderate PSC, and by 83% for severe PSC; corresponding increases among SoC patients were 64%, 49% and 49%, respectively. We also assumed PSC management was similar in each country (Table 4).

Table 4. Use and cost of healthcare services during PSC, by PSC severity, barrier received, and country

† Facility fee (x3) is the facility fee associated with the first three STN visits. Facility fee (x1) is the facility fee associated with the fourth STN visit.
ⁱ 0% for the UK, Sweden, Norway and Italy
ⁱⁱ 100% for the UK, Sweden, Norway and Italy
ⁱⁱⁱ 0% in Australia
^iv 0% in the US; values in the table are for the UK, Sweden, Norway and Italy
^v 7.1 in Australia
^vi 8.7 in Australia
^vii Australia only

We assumed that there would be 149,000 ostomates in the US, 29,000 in the UK, 6,900 in Sweden, 9,000 in Australia, 17,000 in Italy and 3,700 in Norway. For the US, ostomates were assumed to be enrolled in a health plan comprised of 58,400,000 members; estimates of plan size were limited to the US as payers in the US tend to view estimates of budget impact in terms of costs per-member per-month (PMPM) which is estimated by dividing the expected cost by the total number of plan members and then dividing the resulting quotient by 12. Country-specific estimates of changes in population size (both plan members and number of ostomates) is presented in Table 5, as is the assumed annual inflation rate for medical costs.

Table 5. Country-specific estimates of changes in population size (both plan members and number of ostomates) and the assumed annual inflation rate for medical costs: assumptions for a 5-year analysis

Note: Positive values denote expected increases; negative values expected decreases

Data Analysis

The model generated total expected numbers of expected PSC under both scenarios and corresponding expected ostomy-related costs, i.e., PSC-related care plus ostomy-related care. The 1-year budget impact was estimated by subtracting the total expected costs under the CIB scenario from those of the SoC scenario. We calculated the estimates of the budget impact alternatively, assuming uptake of CIB to be 5%, 10%, 15%, 20% and 25% (all versus 0% for the SoC scenario) (Table 6).

Table 6. 1-year budget impact results under different CIB scenarios

* Based on a plan with 58,400,000 members.
Note: Negative values denote expected savings.

We examined the 5-year expected budget impact of CIB, considering cost inflation and annual changes in ostomy cohort size; in addition, for the US, we estimated annual change in plan enrolment (Table 5). We also varied the uptake of CIB over time, assuming 5% would use these barriers in year 1 of the CIB scenario, 7.5% in year 2, 10.0% in year 3, 10.0% in year 4 and 10.0% in year 5 (all versus 0% for SoC) (Table 7).

Table 7. Expected annual budget impact of CIB over 5 years

* Costs of care under the SoC scenario increase annually due to inflation and assumptions on cohort size.
† In each year of interest, all patients not assumed to use CIB were assumed to use SoC barriers.
‡ Based on a plan with 58,400,000 members.
Note: Negative values denote expected savings.

We conducted a sensitivity analysis in which the costs of PSC were changed to those reported in a retrospective study of ostomates identified in a US integrated healthcare system by Taneja and colleagues²¹; findings from their study indicated that patients who experienced PSC averaged US$8,031 more in all-cause medical-care costs over 120 days than those who did not (US$58,329 versus US$50,298; p=0.251)²¹. For this analysis, we used the model to estimate the incidence of PSC in both the SoC and CIB cohorts, and used these proportions to calculate average costs for a patient assumed to use SoC and CIB, respectively. We then multiplied these costs by the corresponding market shares for SoC and CIB, respectively, to calculate the expected budget impact of CIB. Due to the source of cost and utilisation estimates, this analysis was limited to the US.

We also conducted deterministic sensitivity analyses (DSA) to examine the sensitivity of model output to varying parameter values. In these analyses, each model parameter was varied to its lower and upper 95% confidence interval (CI) value, respectively.

Results

1-year model

Over 1 year, the total expected stoma-related costs for the SoC scenario were US$403.2m in the US, £70.5m in the UK, SEK139.9m in Sweden, A$25.6m in Australia, €33.8m in Italy, and NOK97.3m in Norway; corresponding values for the CIB scenario (20% of patients in each country assumed to use CIB in lieu of SoC; 80% used SoC) were US$396.6m, £70.1m, SEK138.0m, A$25.2m, €33.6m and NOK95.7m respectively. Resulting budget savings associated with CIB were therefore US$6.7m in the US, £0.4m in the UK, SEK1.8m in Sweden, A$0.4m in Australia, €0.2m in Italy, and NOK1.5m in Norway. As the use of CIB was expected to be cost-saving, the corresponding PMPM impact in the US was also expected to be cost-saving, although relatively small due to the large number of assumed plan members (Table 6).

5-year model

Five-year analyses yielded cost savings ranging from US$1.7m in year 1 to US$4.0m in year 5 in the US, from £0.1m in year 1 to £0.2m in year 5 in the UK, from SEK0.5m in year 1 to SEK1.2m in year 5 in Sweden, from A$0.09m in year 1 to A$0.3m in year 5 in Australia, from €0.06m in year 1 to €0.3m in year 5 in Italy, and from NOK0.4m in year 1 to NOK1.0m in year 5 in Norway (Table 7). Over the longer period, the use of CIB in a relatively limited population (i.e., a maximum of 10% of all eligible ostomates in any given year) resulted in expected cost savings of stoma-related care of US$15,620,684 in the US, £965,616 in the UK, SEK4,613,414 in Sweden, A$1,042,678 in Australia, €560,695 in Italy, and NOK3,805,873 in Norway.

Deterministic sensitivity analyses

The 20 variables for which budget impact results are most sensitive are presented for each country in Figures B1–B6 in Appendix B, i.e., one figure per country. Regardless of country, variables with the largest effect on budget impact were the percentage of patients using pouching supplies and accessories with relatively high unit costs, and the annual probability of PSC given the use of SoC barriers. In the US and Australia, CIB remained cost-saving across all DSAs conducted; in the other countries it was expected to be cost-saving in all sensitivity analyses except one ‘extreme’ scenario – the percentage of patients using more costly pouching supplies or accessories was set to the lower-bound 95% CI value of weekly costs for SoC and the higher-bound 95% CI value for CIB. In this extreme scenario, expected budget increases were <1% of annual costs of care expected under the SoC scenario (£207,042 in the UK, SEK116,916 in Sweden, €293,897 in Italy and NOK112,709 in Norway). In all countries evaluated, CIB was expected to be cost-saving when the probability of PSC with SoC was set to its lower-bound 95% CI value and the corresponding estimate for CIB was set to its higher-bound 95% CI value.

Scenario analysis

When we replaced cost inputs derived from ADVOCATE with those estimated using real-world US data over the 120-day period following ostomy surgery, resulting estimates of budget savings associated with an increased use of CIB were greater than those obtained in the base case (Table 8).

Table 8. Expected 1-year budget impact associated with the use of CIB and real-world healthcare costs in US patients

* Based on a plan with 58,400,000 members.

Discussion

Findings from our study suggests that the use of CIB in lieu of other skin barriers is expected to result in savings to payers within 1 year. The magnitude of expected savings is dependent on the percentage of ostomates who would use CIB instead of other skin barriers. Estimates of impact were greatest for the US (from US$1.7m at 5% CIB to US$8.3m at 25% CIB), and lowest for Norway (from NOK381,008 [US$43,321] at 5% CIB to NOK1,905,042 [US$216,603] at 25% CIB)²². Estimates for the US were substantially larger than those expected for other countries of interest, likely due to its relatively high costs of medical care (including accessories) versus the other countries included in this evaluation. CIB was expected to result in lower costs of care (i.e., savings) across all six countries assessed.

Results were fairly robust in sensitivity analyses. 5-year projections of budget impact were most heavily influenced by assumptions of market share of CIB, although additional payer savings were projected simply by increasing the number of ostomates and/or costs of medical care, respectively. Similarly, results of the scenario analysis that used real-world US costs of PSC as opposed to ADVOCATE (i.e., approximately US$8,000 versus US$36.46 over a 12-week period) also projected increased savings in all scenarios (versus SoC) relative to the base case, irrespective of assumed CIB uptake. However, this scenario included all-cause healthcare costs, not only those specific to ostomy care. Unsurprisingly, CIB was found to be cost-saving across nearly all DSA scenarios, with the model being most sensitive to the percentages of patients using relatively expensive pouching supplies and accessories and PSC incidence. In the one ‘extreme’ instance where the use of CIB was expected to increase total costs, the resulting budget impact represented a very modest increase in annual costs of care. Findings were consistent across all countries assessed.

While the economic value of pharmaceutical products (in terms of cost-effectiveness and budgetary impact) have been assessed for decades, comparatively less is typically done for medical devices. This is somewhat counter-intuitive, as the number of devices coming to market vastly exceed that of pharmaceuticals. In 2012, over 10,000 patent applications for medical devices were filed in Europe, which was approximately twice that for pharmaceuticals²³. As opposed to cost-effectiveness analyses, which focus on the benefits of the assessed technology at the patient level, budget impact analyses examine affordability to the payer. In our opinion, this question of affordability is of equal importance. In fact, assessments of budget impact are “…an ‘essential’ part of comprehensive economic assessment of medical technology”²⁴.

This issue is perhaps even more important in fields such as ostomy, in which nurse clinicians and other providers are often tasked with a dual, often competing, role to provide quality care while simultaneously containing costs. Accordingly, the use of economic models based on evidence obtained from randomised trials and other well-conducted studies is an important means by which healthcare professionals, payers and other interested parties can estimate the value of a given product based on its efficacy and safety. Results of such models can then be used to help align these parties on cost-effective, high-quality patient care.

We implemented principles of good practice for budget impact analyses, as set forth by the International Society for Pharmacoeconomics and Outcomes Research (ISPOR)¹⁹, including our reliance on ADVOCATE, a randomised clinical trial, for most input values used in the model, as well as the inclusion of sensitivity analyses to better understand the degree to which model output relied on inputs and assumptions. Results of our analyses are consistent with those of ADVOCATE¹⁵ and the published cost-effectiveness model¹⁸, and provide evidence that the value of CIB enjoyed by patients also manifests as cost savings to payers across various countries.

Limitations

Our study has several limitations. First, like all economic models, ours presents a somewhat simplified view of clinical practice, such as limiting to a maximum of two the incidence of PSC during 1 year, including a maximum of one PSC during an ‘early’ (i.e., 12-week) period and a maximum of one PSC during a ‘late’ (i.e., 40-week) period. The degree to which these assumptions adequately capture actual patient experience is not known. On a related matter, in the absence of data, we arbitrarily – and somewhat conservatively – set risk of a second PSC. The model also does not differ between ostomy types (e.g., ileostomy, colostomy) in terms of PSC risk, use of skin barriers, and/or use of accessories.

The economic and clinical impacts of CIB are based on findings from ADVOCATE, including but not limited to the incidence of PSCs (55% of SoC patients vs. 41% of CIB patients), and the distribution of patients by ostomy type (about one-third had an ileostomy; about one-half had a colostomy; and all other patients had a urostomy). Further study is needed to better understand the impact of CIB in different populations, both in terms of distribution by ostomy type as well as with different demographic and/or comorbidity profiles than subjects enrolled in ADVOCATE.

We also assumed that publicly available country-specific unit costs for various items used in stoma-related care were adequate representations of what is spent on care of ostomy patients by payers in each country. However, the degree to which this assumption is true for the US – which has many different types of payers (e.g., private commercial insurance, Medicare) and, within some payer types, equal if not more heterogeneity across insurers in terms of reimbursement policies – and other countries of interest in unknown.

Furthermore, while ADVOCATE was limited to the use of two-piece systems, we assumed the use of both one- and two-piece systems, and that benefits of CIB would be consistent across both types of systems. We also assumed that PSC were of fixed duration. However, other studies have reported resolution times varying between 7 weeks to over 3 months^4,5,25; consequently, our analyses may have underestimated the economic consequence of PSC. We note, however, that to the degree this occurred, estimated budget impact associated with the use of CIB in lieu of other skin barriers is likely conservative, i.e., the ‘true’ magnitude of savings resulting from the use of CIB may be greater than what is estimated herein.

Conclusions

The use of CIB results in expected cost reductions to payers in the US, UK, Sweden, Australia, Italy and Norway, with the magnitude of expected reductions directly related to percentages of patients assumed to use CIB in lieu of SoC. While our findings are consistent with those of ADVOCATE and previous cost-effectiveness modelling, further research is needed to better understand the economic consequences of the use of CIB (versus other skin barriers) in clinical practice.

Conflict of Interest

Gary W Inglese and George Skountrianos are employees of Hollister Incorporated. Ariel Berger and Mustafa Oguz are employees of Evidera Inc. which provides consulting and other research services to pharmaceutical, device, government and non-government organisations. Evidera Inc. received funding from Hollister Incorporated in connection with conducting this study and with developing this manuscript. Davide Croce is an employee of the Università Carlo Cattaneo and did not receive any funding for the conduct of this study or for the development of this manuscript.

Funding

Funding for this research was provided by Hollister Incorporated.

Author(s)

Ariel Berger* MPH
Executive Director, Integrated Solutions – RWE
Evidera, 500 Totten Pond Road, 5th Floor, Waltham, MA 02451, USA
Email ariel.berger@evidera.com

Gary Inglese RN, MBA
Senior Director, Market Access
Hollister Incorporated, Libertyville, IL, USA

George Skountrianos MS
Statistician, Global Clinical Affairs
Hollister Incorporated, Libertyville, IL, USA

Davide Croce MBA
Aggregate Professor
Research Center in Health Economics, Social and Healthcare Management, Università Carlo Cattaneo–LIUC, Castellanza (Va), Italy

Mustafa Oguz PhD
Senior Research Associate, Data Analytics
Evidera Inc., Hammersmith, London, UK

* Corresponding author

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Appendix A. Pouching Supply Use

With the exception of the UK, the costs of CIB pouching systems were assumed equivalent to those of SoC systems. In the UK, the per package cost of one-piece flat closed, convex closed, flat drainable, and convex drainable systems were £87.75, £98.70, £97.95 and £135.75 for SoC; and £88.68, £99.90, £106.42 and £144.31 for CIB, respectively. The baseplate and pouch package cost for two-piece systems were £20.00 and £1.69, respectively, for both SoC flat and convex systems, £22.24 and £1.69 for CIB flat systems, and £22.72 and £1.69 for CIB convex systems. Pouching supply use parameters are provided in Tables A1 to A6 below.

Table A1. Pouching supply use: US

Table A2. Pouching supply use: UK

Table A3. Pouching supply use: Sweden

Table A4. Pouching supply use: Australia

Table A5. Pouching supply use: Italy

Table A6. Pouching supply use: Norway

Appendix B. DSA of Expected Budget Impact, by Country

Expected budget impact associated with the use of a CIB versus SoC among patients within 12 weeks of faecal ostomy surgery in Australia, Italy, Norway, Sweden, the UK and the US.

Please note:  Figure B1. DSA of expected budget impact: US, was not available at time of publishing

Figure B2. DSA of expected budget impact: UK

Figure B3. DSA of expected budget impact: Sweden

Figure B4. DSA of expected budget impact: Australia

Figure B5. DSA of expected budget impact: Italy

Figure B6. DSA of expected budget impact: Norway