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Cost-effectiveness of care for very low birth weight infants
1RAND Corporation, Washington, DC 20005, USA.
Insights
Very low birth weight (VLBW) infants incur high medical costs, with survival expenses reaching $93,800 per infant. Improving birth weight can lead to significant first-year medical cost savings, but threshold effects exist for extremely low birth weights.
Area of Science:
- Neonatal Medicine
- Health Economics
- Public Health Policy
Background:
- Very low birth weight (VLBW) infants (<1500 g) represent a small fraction of births but a disproportionately large percentage of infant mortality.
- Advances in neonatal technology have improved survival rates for VLBW infants, but associated medical costs are substantial and have not been fully quantified.
- Existing public policies regarding VLBW infant care are often based on cost-effectiveness arguments, despite a lack of comprehensive cost data.
Purpose of the Study:
- To quantify the medical care costs and cost-effectiveness of care for very low birth weight (VLBW) infants during their first year of life.
- To inform public policy decisions regarding insurance coverage and treatment payment for VLBW infants based on empirical cost data.
Main Methods:
- The study analyzed data for all singleton VLBW live births in California during 1986-1987.
- Inclusion criteria required continuous eligibility for the state's Medicaid program.
- Treatment costs encompassed all inpatient and outpatient medical care received within the first year of life. Cost-effectiveness was calculated as total medical costs divided by the number of first-year survivors.
Main Results:
- The average first-year treatment cost per survivor for VLBW infants (<1500 g) was $93,800 (1987 dollars).
- Costs per survivor increased significantly with lower birth weights: $273,900 for infants <750 g, $138,800 for 750-999 g, and $75,100 for 1000-1249 g.
- The cost-effectiveness gradient decreased for infants between 1250-1499 g, with costs of $58,000 per survivor.
Conclusions:
- Public policies promoting improved birth outcomes, such as Medicaid expansions, can be highly cost-effective.
- Increasing birth weight can yield substantial first-year medical cost savings; a 250 g increase saves $12,000-$16,000, and a 500 g increase saves $28,000.
- There is a threshold effect: for infants <750 g, increasing birth weight may raise medical expenditures, with a shift to the 750-999 g range increasing costs by $29,000.
Objective:
Very low birth weight (VLBW)infants (those with birth weights <1500 g) account for only 1.2% of births but 46% of infant deaths. Large improvements in neonatal technology in the last 2 decades have significantly improved survival prospects for infants with low birth weights, but at a high cost. Due largely to a lack of data, the costs of medical care during the period in which infant mortality is measured (the first year of life), as well as the cost-effectiveness of that care for VLBW infants, have not been quantified. Despite this fact, public policies both toward providing insurance coverage for their care, as well as denying payment for their treatment, have either been proposed or implemented on cost-effectiveness grounds.
Patients:
The study includes all VLBW single live births in the state of California during 1986 and 1987 that were continuously eligible (through traditional channels) for the state's Medicaid program.
Main Outcome Measures:
Treatment costs were measured for all medical care received during the first year of life, including all inpatient and outpatient care received. The cost-effectiveness of care is measured by aggregate treatment costs for all singleton VLBW liveborns divided by the number of first-year survivors.
Results:
Average treatment costs per first-year survivor for infants <1500 g was $93 800 (in 1987 constant dollars). Treatment costs per survivor were twice as high for infants <750 g ($273 900) as for the next highest birth weight group 750 to 999 g ($138 800) which was itself almost twice as high as for the 1000 to 1249 g group ($75 100). The gradient in cost-effectiveness with birth weight then drops off to $58 000 per survivor for infants with birth weights between 1250 and 1499 g.
Conclusion:
Public policies aimed at improving birth outcomes by providing insurance coverage for pregnant women and children, such as the recent Medicaid expansions, can potentially be very cost-effective. Although maternal interventions such as prenatal care are relatively inexpensive, each normal birth that results instead in a VLBW birth saves $59 700 in first year medical expenses. However, cost savings attributable to increased birth weights depend on where in the birth weight distribution the increase occurs as well as the size of the birth weight increase. For infants with birth weights >750 g, significant gains can accrue from even a small shift in the birth weight distribution. A shift of 250 g at birth saves an average of $12 000 to $16 000 in first year medical costs and a shift of 500 g generates $28 000 in savings. However, there is a threshold effect on birth weight. For infants <750 g, increases in birth weight may increase medical expenditures. For instance, a shift in birth weight to the 750 to 999 g range increases costs by $29 000.