DO DATA SOURCES MATTER? COMPARING MARKET COST AND PAYER COST APPROACHES TO CALCULATING MEDICAL SPENDING MEASURES IN REAL-WORLD DATA
Author(s)
Timothy W. Smith, BA1, Caitlin Curnyn, MPH1, Veronica Ansolabehere, BA1, Laura A. Weber, MS1, Teresa B. Gibson, MA, MS, PhD2;
1HealthVerity, Philadelphia, PA, USA, 2RIT / Hyvold Consulting, Rochester, NY, USA
1HealthVerity, Philadelphia, PA, USA, 2RIT / Hyvold Consulting, Rochester, NY, USA
OBJECTIVES: Direct medical spending from closed claims sources are commonly used for cost-focused real world data (RWD) studies, although generalizability may be limited by concentration of insurance plans and missing or obfuscated payer costs. Open claims sources can be used in conjunction with closed claims sources to improve generalizability by employing market costs instead of payer costs. This research aims to determine whether estimates based on market costs are predictive of estimates based on payer costs.
METHODS: Total annual direct medical spending was calculated for patients in HealthVerity taXonomy with continuous commercial medical and pharmacy enrollment throughout 2024 who had both market and payer costs available. Market costs represent utilization from the closed claim multiplied by median unit cost from open claims for the appropriate service, payer type, geographic region, and year. Payer costs represent the allowed amount from the closed claim. Employing statistical methods from clinical agreement studies, linear regression was used to predict payer spending from market spending measures. The Equivariant Passing-Bablok method, a symmetrical, nonparametric regression, was used to estimate translation between measures.
RESULTS: We employed agreement methodologies on the medical and prescription drug experiences of a random sample of the 10,409,060 continuously-enrolled commercially insured individuals with both sets of costs available. Linear regression estimates of slope across the range of values were 0.996 [95% CI: 0.982, 1.01], indicating accurate prediction of payer-derived spending from market-derived spending. Equivariant Passing-Bablok estimates of slope were 0.956 [0.944, 0.968] providing translation from market-derived to payer-derived spending, the inverse of which can be used to translate from payer-derived to market-derived spending.
CONCLUSIONS: Market-derived spending demonstrated strong agreement with payer-derived spending at the person-year level. These findings support the use of market cost measures as an appropriate proxy for payer costs in RWD studies.
METHODS: Total annual direct medical spending was calculated for patients in HealthVerity taXonomy with continuous commercial medical and pharmacy enrollment throughout 2024 who had both market and payer costs available. Market costs represent utilization from the closed claim multiplied by median unit cost from open claims for the appropriate service, payer type, geographic region, and year. Payer costs represent the allowed amount from the closed claim. Employing statistical methods from clinical agreement studies, linear regression was used to predict payer spending from market spending measures. The Equivariant Passing-Bablok method, a symmetrical, nonparametric regression, was used to estimate translation between measures.
RESULTS: We employed agreement methodologies on the medical and prescription drug experiences of a random sample of the 10,409,060 continuously-enrolled commercially insured individuals with both sets of costs available. Linear regression estimates of slope across the range of values were 0.996 [95% CI: 0.982, 1.01], indicating accurate prediction of payer-derived spending from market-derived spending. Equivariant Passing-Bablok estimates of slope were 0.956 [0.944, 0.968] providing translation from market-derived to payer-derived spending, the inverse of which can be used to translate from payer-derived to market-derived spending.
CONCLUSIONS: Market-derived spending demonstrated strong agreement with payer-derived spending at the person-year level. These findings support the use of market cost measures as an appropriate proxy for payer costs in RWD studies.
Conference/Value in Health Info
2026-05, ISPOR 2026, Philadelphia, PA, USA
Value in Health, Volume 29, Issue S6
Code
MSR145
Topic
Methodological & Statistical Research
Disease
No Additional Disease & Conditions/Specialized Treatment Areas