Tony Blakely Nick Wilson Treasury 13 August 2014 Tobacco tax modelling and other cost-effectiveness studies for NZ: Latest BODE 3 Results
Overview • who we are • what we do • tobacco endgame – game on! • other examples: • HPV vaccination, cancer care coordinators and costing studies • BODE 3 tools
Who we are
“Is this a sensible thing to do?” Size of the problem Effectiveness Cost-effectiveness Affordability Safety/Risk Impact on inequalities Feasibility Public acceptability Government priorities Availability of other alternatives Direct cost to users Other criteria
Cost-effectiveness What do we do more of? What do we do less of? Is this a sensible thing to do? Who should get this?
How we do it INPUTS OUTPUTS MODEL Cost-effectiveness
MODEL Markov models Discrete event simulation Multistate life tables
INPUTS Same general data inputs, methods and outputs across BODE 3 evaluations comparability between interventions
Tobacco Endgame – Game On! Tony Blakely, Nick Wilson, Amber Pearson, Linda Cobiac, Nhung Nghiem and Frederieke van der Deen Tobacco Endgame Burden of Disease Epidemiology, Equity and Cost-Effectiveness Programme 15
Structure • Background • ‘Business as Usual’ (BAU) – what smoking prevalence do we forecast out to 2025 and beyond? • Ongoing 10% (and more) per annum increases in tax: – What impact will that have on smoking prevalence? – What impact will that have on QALYs and health system costs? • So what? – Putting it in context of the endgame – What we should do next – policy and research. 16
Background – tobacco smoking in NZ • The major single risk factor causing of health loss in NZ (for 2006 – NZBDS) • Major contributor to ethnic inequalities in health • NZ one of 4 countries with endgame goals • NZ using regular tax increases (annual since 2010), retail display restrictions, strong cessation activity (Quitline service, pharmacotherapy, counselling by health workers), but fairly minimal in some areas (mass media) 17
BAU smoking prevalence projections to 2025 and beyond in New Zealand 18
Methods • A dynamic forecasting tobacco model previously built for Australia 1 was adapted for NZ by Ikeda et al. (2013) 2 • A Markov model designed in MS Excel – Input data (by age, sex, and ethnicity) • Smoking prevalence data from the 2006 and 2013 NZ Census 3 • Annual birth projections • Annual trends in mortality rates • Relative risks of mortality for current and former smokers from NZCMS 4 1. Gartner et al. Tob Control 2009;18:183-9. 3. Cobiac et al. Tob Control Under review 2. Ikeda et al. Tob Control doi:10.1136/tobaccocontrol-2013-051196 4. Blakely et al. N Z Med J 2010;123(1320):26-36 3. Van der Deen et al. Under review (updates Ikeda from using NZHS to census data – important) 20
Smoking prevalence projections - men 18.7 % 8.3% 2025 23
Smoking prevalence projections - women 19.3 % 6.4% 4.4 % 24
Intermediate conclusion • The 2025 goal is not achieved by any group under the projected annual trends in initiation and cessation (assuming no further tax rises after 2014) • Thus, time to explore scenarios that go beyond business- as-usual: – E.g. Ongoing 10% (and more) per annum increases in tax 25
Tobacco taxes and smoking prevalence 26
The average (legal) price of a cigarette $0.21 $0.40 Wholesale price + retail margin $0.09 Excise tax GST of 15% 2011 New Zealand dollars 27
Cigarette price projections with 10% tax $2.00 $40 pack $1.80 $1.60 $1.40 2011NZD $1.20 $1.00 $14 $0.80 pack $0.60 $0.40 $0.20 $0.00 29
Tobacco taxes in New Zealand 1. Will 10% annual tax increases be enough to reach <5% prevalence by 2025? 2. Could growth in the illicit tobacco market undermine the benefits of tax increases? 30
How do people respond to increasing price? • More smokers quit (or fewer young people start) • Smokers cut-down on number of cigarettes smoked • Response is measured by price elasticity – International review (IARC 2011) : -0.2 to -0.5 – New Zealand study (Tait et al. 2013) : -0.47 31
Smoking prevalence projections 18% 2025 16% 9.9% 14% No tax increase 5% increase 12% Smoking prevalence 10% increase 8.7% 15% increase 10% 20% increase 8% 6% 4% 2% 0% 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055 2060 32
Smoking prevalence in 2025 25% 20% 18.4% 17.9% 15% 10% 8.2% 6.1% 5% 5% 0% Non- Māori Men Non- Māori Women Māori Men Māori Women No tax increase 10% increase 20% increase 35
QALY gains and cost-effectiveness of tobacco taxes 36
Methods – baseline data • Including the following diseases: – Ischaemic heart disease (IHD) and stroke; respiratory disease (COPD & LRTI) – Cancers: bladder, cervical, endometrial, head and neck, kidney, liver, lung, melanoma, oesophageal, pancreas, stomach, thyroid. • All-cause mortality from SNZ lifetables with 1.75% (non- Māori) and 2.25% (Māori) p.a. ↓ mortality rates to 2026, then 1% ↓ p.a. • Disease-specific incidence, case fatality, prevalence from range of sources, brought together with DISMOD to ensure consistency: – cancer registry, mortality data, HealthTracker, NZ Burden of Disease Study (NZBDS), NZCMS, CancerTrends • Morbidity incorporated using years of life lost (YLDs) from NZBDS • Costs in each state from HealthTracker, 2011 $ 37
Methods – multistate lifetable • A multistate lifetable is literally that – a lifetable in which subjects (proportions of a cohort) can be in multiple states simultaneously 38
Methods – intervention parameterization • ↑Tax → ↑price → ↓prevalence and cigs/day: – Using price elasticities applied in year of increase only (and in subsequent year in scenario analyses = ‘persistence’ scenario). • Relative risks for smoking (NZCMS, other) applied to changing prevalence and cigs/day to calculate population impact fractions (PIFs; aka PAR%), that are then ‘fed into’ the lifetables to de(in)crease disease incidence. • Difference in QALYs and cost for 2011 population between comparator and intervention tallied up for rest of their life (max 110 years). 3% discount rate. 39
Costs and QALYs – all 2011 population Non- Māori Māori Total Health gain Cost Offsets Health gain Cost Offsets Health gain Net costs QALYs Millions QALYs Millions QALYs Millions 32,030 $-406.2 17,550 $-154.4 49,580 $-560.6 10% tax (28,650 to (-462.7 to - (15,560 to ($-177.0 to (45,790 to ($-619.5 to $- increase 35,330) 353.9) 19,460) $-132.8) 53,390) 504.3) 20% tax 61,610 -$777.6 33,430 -$292.5 95,030 -$1,070.1 increase PRELIMINARY RESULTS – will change a little with pending improvements. Not for citation 40
QALYs gained per capita Māori Non- Māori RR 10% tax 0.0260 0.0086 3.04 • Strong health inequality reduction: – in relative terms – but not so much in absolute terms as only about 3 (non- Māori) to 9 (Māori) quality day of life gained per person in the population • [gain much more for the actual person who quits] PRELIMINARY RESULTS – may change a little with pending improvements. Not for citation 41
Timing of health gains 6 Thousands 5 Non- Māori, QALYs gained, undiscounted 4 3 2 Māori, QALYs gained, QALYs gained 1 undiscounted 0 -1 -2 Non- Māori, QALYs gained, discounted -3 -4 -5 Māori, QALYs gained, discounted -6 2011 2031 2051 2071 2091 2111 Year 43 PRELIMINARY RESULTS – will change a little with pending improvements. Not for citation
Timing of health gains and costs averted 6 80 Thousands Millions Non- Māori, QALYs gained, undiscounted 5 60 4 Māori, QALYs gained, undiscounted 3 40 Non- Māori, QALYs gained, 2 discounted Net health cost savings (NZD) 20 QALYs gained 1 Māori, QALYs gained, discounted 0 0 Māori, Health system -1 costs averted, discounted -20 -2 Māori, Health system -3 -40 costs averted, undiscounted -4 Non- Māori, Health system -60 costs averted, discounted -5 Non- Māori, Health system -6 -80 costs averted, 2011 2031 2051 2071 2091 2111 undiscounted Year 44 PRELIMINARY RESULTS – will change a little with pending improvements. Not for citation
Timing of health gains & cost by age QALYs QALYs QALYs $ $ $ 0-14 yr olds 15-24 yr olds 25-44 yr olds 2011 2031 2051 2071 2091 2111 2011 2031 2051 2071 2091 2111 2011 2031 2051 2071 2091 2111 6 $80 6 $80 6 $80 $60 $60 $60 4 4 4 $40 $40 $40 2 2 2 $20 $20 $20 0 $0 0 $0 0 $0 -$20 -$20 -$20 -2 -2 -2 -$40 -$40 -$40 -4 -4 -4 -$60 -$60 -$60 -6 -$80 -6 -$80 -6 -$80 QALYs QALYs $ $ 45-64 yr olds 65+ yr olds Legend 2011 2031 2051 2071 2091 2111 2011 2031 2051 2071 2091 2111 QALYs gained (thousands), 6 $80 6 $80 discounted $60 $60 4 4 $40 $40 QALYs gained (thousands), 2 2 $20 $20 undiscounted 0 $0 0 $0 Health system costs averted -$20 -$20 -2 -2 (millions), discounted -$40 -$40 -4 -4 -$60 -$60 Health system costs averted -6 -$80 -6 -$80 (millions), undiscounted 45 PRELIMINARY RESULTS – will change a little with pending improvements. Not for citation
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