Presentation (CTI)

OBJECTIVES: Accurate budget impact projections depend on correctly estimating the eligible patient population. In US budget impact analyses, a common starting point is a 1‑million‑member health plan, with epidemiology-based inputs used to estimate eligible patients. For acute conditions and diseases with short survival, it is convenient to estimate eligible patients based on incidence. In contrast, chronic conditions often involve long treatment durations and multiple regimens, making eligible population estimation more complex. This analysis examines how alternative approaches to defining the 1‑million‑member population affect projected budget impact over time.
METHODS: A hypothetical 3‑year Microsoft-Excel^®-based budget impact analysis for a chronic condition was developed comparing three approaches:

1. Continuous cohort: a single 1‑million‑member population over 3 years - incidence applied annually
2. Cumulative add-on: an additional 1 million members added each year - prevalence and incidence applied annually
3. Annual refresh: full 1‑million‑member cohort replaced each year - prevalence and incidence applied annually

Prevalence and incidence are estimated at 5 per 100,000 persons and 1 per 100,000 persons, respectively, resulting in an eligible population of 60 patients in Year 1. A hypothetical intervention ($200 per weekly dose) and one comparator ($100 per weekly dose) are considered, and patients remain on treatment across the time horizon. Annual uptake of the intervention is 10%, 20%, and 30% in Years 1, 2, and 3, respectively.
RESULTS: The cumulative total budget impact for Years 1-3 is $229,583, $438,279, and $187,843 for approaches 1, 2, and 3, respectively. The 3-year average per-member-per-month budget impact is $0.0064, $0.0052, and $0.0052 across the approaches, respectively.
CONCLUSIONS: The method used to define the 1‑million‑member starting population, and how prevalence/incidence are applied, can substantially alter budget impact, particularly for chronic diseases. The annual refresh method may better reflect US health plan membership turnover and coverage resets, potentially influencing payer decisions.