The cost-effectiveness of improving diabetes care in U.S. federally-qualified community health centers

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The health benefits of a federal diabetes care program are clear, but now researchers say that program upgrades also are economically sound.

The new research published in the current issue of Health Services Research evaluates the cost-effectiveness of a quality improvement program set up in 17 Midwestern community health centers between 1998 and 2002. All of the centers serve low-income people, who often have no insurance or money for medications.

“Whether or not a program is cost-effective is the kind of question you ask after you've found that a program works,” said lead researcher, Elbert Huang, M.D., an internist with the University of Chicago.

Earlier research established that patients did better when the health center participated in the Diabetes Health Disparities Collaborative. The program of staff and clinician training and information sharing led to modest improvements in patients' blood glucose and cholesterol levels, as well as greater use of ACE inhibitors, a highly effective class of medicines to control high blood pressure.

Huang's team set out to determine the economic value of those health gains by calculating the incremental cost-effectiveness ratio (ICER) for the program.

An ICER is the cost incurred to obtain an increase in health benefit. It is a health economics concept used to compare the value of very different medical treatments, such as a new drug versus a new diagnostic test. The lower the ratio, the more cost-effective a treatment is.

Health economists typically deem an ICER between $50,000 and $100,000 per quality-adjusted life-year as cost-effective. In the first four years of the Diabetes Health Disparities Collaborative, the program's incremental cost-effectiveness ratio was $33,386 per quality-adjusted life year.

“In other words, the money that you are spending is producing health at a good value. It does not mean that the program is saving money, it just means that the program is improving health at a reasonable cost,” Huang said.

Each health center implemented a site-specific quality improvement program, although features common to several programs included new software to track and manage people with diabetes as well as ways to help patients access free or low-cost medicine.

The researchers found a 0.35 average improvement in quality-adjusted life year. “That suggests that on average a person's life will be extended by about a third of a year,” Huang said. “It's a combined measurement that accounts for both improvements in quality of life but also improvements in length of life.”

An extra three months of life might not seem long, but Huang says it could be a huge society-level benefit considering the sheer numbers of Americans with diabetes and the fact that many of the patients in the study were young and middle-aged working people.

“For society, improving this group's health is paramount,” he said. “If we project that out over the long term, it should reduce rates of blindness, end-stage renal disease and heart disease,” Huang said.

Kevin Frick, a health economist and associate professor at John's Hopkins Bloomberg School of Medicine, said ICERs and quality-adjusted life years are good tangible benchmarks for health policy makers, but he would like to see economists continue to refine the information they provide to health payers and decision makers.

“Policy makers might look at an ICER of $33,000 and say ‘Ah-ha, it's below $50,000. If we had the money it's probably a good investment,'” Frick said.

Nevertheless, Frick asks, “What really matters in our decision-making? Should we give more weight to preventing blindness or to improvements in heart disease? Are the extra expenses paid by the health centers, the patients themselves or maybe the government?”

Health Services Research is the official journal of AcademyHealth and is published by Blackwell Publishing on behalf of the Health Research and Educational Trust. Contact Jennifer Shaw, HSR Business Manager, at (312) 422-2646 or [email protected]. HSR is available online at

Huang ES, et al. The cost-effectiveness of improving diabetes care in U.S. federally-qualified community health centers. Health Serv Res online, 2007.


The opinions expressed here are the views of the writer and do not necessarily reflect the views and opinions of News Medical.
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