Estimation and comparison of ostomy appliance costs with tariffs in Belgium

This study estimated costs of production and distribution of ostomy appliances, and compared cost estimates with tariffs in Belgium. The cost model took into account manufacturing costs, overhead, R&D, warehousing, profits, and distribution margins. Data were derived from manufacturers, a decomposition of finished products, and interviews with stakeholders. The cost model generated estimated retail prices of euro 2.96 for one-piece appliances, euro 1.62 for two-piece pouches, and euro 2.06 for two-piece flanges. Production and distribution costs accounted for 40 and 60% of retail prices, respectively. Estimated retail prices corresponded well with tariffs for one-piece appliances and for two-piece pouches. For two-piece regular flanges, a substantial difference was observed between the calculated price of euro 2.06 and the tariffs of euro 6.05. In the absence of publicly disclosed information on the cost structure of appliances, estimating ostomy appliance costs is valuable to reimbursement agencies when setting tariffs.