Cost‐Effectiveness Analysis of a Capitated Patient Navigation Program for Medicare Beneficiaries with Lung Cancer

OBJECTIVE: To assess the cost-effectiveness of implementing a patient navigation (PN) program with capitated payment for Medicare beneficiaries diagnosed with lung cancer. DATA SOURCES/STUDY SETTING: Cost-effectiveness analysis. STUDY DESIGN: A Markov model to capture the disease progression of lung cancer and characterize clinical benefits of PN services as timeliness of treatment and care coordination. Taking a payer's perspective, we estimated the lifetime costs, life years (LYs), and quality-adjusted life years (QALYs) and addressed uncertainties in one-way and probabilistic sensitivity analyses. DATA COLLECTION/EXTRACTION METHODS: Model inputs were extracted from the literature, supplemented with data from a Centers for Medicare and Medicaid Services demonstration project. PRINCIPAL FINDINGS: Compared to usual care, PN services incurred higher costs but also yielded better outcomes. The incremental cost and effectiveness was $9,145 and 0.47 QALYs, respectively, resulting in an incremental cost-effectiveness ratio of $19,312/QALY. One-way sensitivity analysis indicated that findings were most sensitive to a parameter capturing PN survival benefit for local-stage patients. CE-acceptability curve showed the probability that the PN program was cost-effective was 0.80 and 0.91 at a societal willingness-to-pay of $50,000 and $100,000/QALY, respectively. CONCLUSION: Instituting a capitated PN program is cost-effective for lung cancer patients in Medicare. Future research should evaluate whether the same conclusion holds in other cancers.